President Trump and his Secretary of the Interior, Ryan Zinke, are pulling out all the stops to prop up coal, but in the American West, not even political scheming can stop the industry from collapsing.
New Mexico Mine Going Down
The latest news is Public Service Company of New Mexico’s (a.k.a., PNM’s) plan to ditch coal by 2031.
The move is a major shift for the utility, which for years has defended its reliance on New Mexico’s Four Corners Power Plant and San Juan Generating Station, two of the largest coal-fired power plants in the western U.S. In an Integrated Resource Plan released last week, PNM announced it would be more cost-effective to shutter the San Juan Generating Station by 2022 and retire its share of the Four Corners Power Plant (13%) by 2031.
Excerpt from PNM’s Integrated Resource Plan.
WildEarth Guardians has been working for years to expose the true cost of burning coal at the Four Corners Power Plant and San Juan Generating Station. Most recently, we spearheaded comments calling on the U.S. Office of Surface Mining to reject a new mining approval at San Juan and instead develop an economic transition plan for the region.
While PNM’s move promises a major decline in coal-fired electricity generation, it also means a major scale back for mining in the region.
For the Navajo mine, which fuels the Four Corners Power Plant, it likely means major production cuts.
For the San Juan mine, which fuels the San Juan Generating Station, this certainly means the end.
That’s a big deal for the mine’s owner, Westmoreland Coal. Shares of the company have already lost two thirds of their value during the second quarter of this year and its stock price hit a 52-week low last week. The loss of the San Juan mine will surely be major hit to the company’s bottomline and future viability.
It doesn’t end there for the coal industry, though.
Arch Coal Bails on New Mine
In April, the U.S. Department of the Interior decided to officially close out a federal coal lease in Wyoming that Arch Coal intended to use to start a brand new mine. While Interior said nothing publicly of the decision, it was a huge deal.
The coal lease in question, a 5,200 acre tract containing 65 million tons of coal near southern Wyoming’s Elk Mountain, was sold to Arch in 1999. The company expected to use the lease to start a new mine that would ultimately fuel a coal-to-gasoline facility.
As we wrote about before, the idea of a “coal to liquids” operation was a major boondoggle from the start and promised to be a major climate disaster (see for yourself what this had the potential to do to southern Wyoming). Thankfully, in 2016 the company behind the facility announced plans to scrap the proposal.
In early 2016, WildEarth Guardians called on Arch Coal to relinquish its coal lease. Now, with Interior’s latest decision, it is now clear that the company’s plans for a new coal mine in southern Wyoming are dead. Americans can also breathe a sigh of relief that coal once in the hands of Arch Coal is now back in the hands of the public and will stay in the ground where it belongs.
Mining Company Puts on Brakes
To top it off, at the end of May, we found out the mining and construction company, Kiewit, has bailed on two huge new federal coal leases in Wyoming.
The company withdrew an application for a new federal coal lease in southwestern Wyoming, putting the brakes on a new coal mine in this region. Kiewit had been steadily pursuing the open-pit Haystack mine for years. While it was expected to open in 2013, the company instead halted construction.
In 2003, the company applied for a 300-acre federal lease containing 14.3 million tons of coal. Yet according to Interior Department records, Kiewit withdrew its application for the new lease on May 30, 2017. The news indicates the company is likely abandoning plans to construct the Haystack mine.
To boot, on the same day, Kiewit also withdrew an application for a massive new coal lease. Called the Hay Creek II lease, it would have expanded the company’s open-pit Buckskin mine in the Powder River Basin of northeastern Wyoming.
Buckskin is the 10th largest coal mine in the United States and the Hay Creek II lease would have opened the door for a 1,200-acre expansion and more than 462 million tons of new coal mining.
The withdrawal of the lease caps quite a saga. Amid protests, in 2013 the U.S. Bureau of Land Management rejected Kiewit’s attempt to purchase the Hay Creek II lease for 21¢ a ton. Although the company asked the agency to reoffer the lease for sale, it never happened.
Kiewit’s moves almost seem to indicate a wholesale shift away from coal. Given that the company also maintains a lucrative construction business, it could very well be we’re seeing the end of Kiewit’s coal business start to play out.
The Writing on The Wall
The coal industry certainly isn’t dead yet, but the writing is on the wall. In 2017 alone, it’s expected 8,000 megawatts of coal-fired power generation will be retired and dozens more coal-fired power plants are projected to shut down over the next decade.
While Trump and Zinke are pushing for more coal mining, especially on public lands in the American West, their efforts are vain, at best. With utilities backing out of coal and mining companies losing their economic grip, not even the worst of political shenanigans seem capable of rescuing fossil fuels. WildEarth Guardians will be sure of that.
