Hamilton provided an overview of the current status of West Virginia’s coal industry with a focus on the challenges faced by the industry and the state as a result of the combination of economic and political policy factors.
“The reality is that we face a host of challenges,” Hamilton said. “Including economic uncertainty around the world, relatively mild weather patterns over the past few years, low natural gas prices and, of course, the impacts of the regulatory policies being pursued by the EPA, MSHA and OSM. All of these have come together to create a ‘perfect storm’ for West Virginia’s coal industry – a storm that has cost thousands of jobs and billions in economic losses.”
Hamilton pointed out that the state has lost approximately 28 percent of its coal production since the Obama Administration took office in 2009, as well as more than 5,000 direct coal mining jobs and tens of thousands of support jobs.
“We have also seen downward trending coal prices, the closure or pending closure of hundreds of coal-fired power plants and the loss of millions in revenues to the state and counties,” Hamilton said, noting that several counties have already begun to lay off government workers and cut back on services.
Hamilton said the national energy agenda is simply “out of whack” with its focus on global climate change, and that the current agenda is “regressive, punitive and is destroying jobs and displacing workers.”
Despite the attitude of the current federal government in Washington, the long-term prospects for coal are good, Hamilton said.
“Coal has been the largest and fastest growing major fuel source for power generation in the world, and it is projected to supplant oil as the world’s most prominent energy source by 2018,” Hamilton said. “By 2020, coal consumption should increase to 2 billion tons and if the current trends continue it could increase by as much as 4 billion tons. Demand is growing in Europe and Asia, with Germany and Japan turning back to coal to replace unsafe nuclear energy sources and to provide dependable power to counterbalance the problems they are seeing with renewable power sources such as wind.”
Turning back to the United States, Hamilton said the biggest threats to coal going forward are the EPA’s New Source and Existing Source Performance Standards.
“They will essentially prohibit construction of new fossil fuel power plants in the United States and make it nearly impossible and uneconomic to invest in upgrades to existing facilities, forcing the closure of hundreds and leading ultimately to the closure of many if not most of the rest, unless the policies in Washington are changed,” Hamilton said.
“This will have profound impacts on Americans. Not only with the job losses that will result, but also with skyrocketing electric bills that will force people to choose between paying their electric bills and putting food on the table,” Hamilton said. “And the people who will suffer most will be the poor and the elderly who live on fixed incomes. And ironically, at the same time, the reduced revenues to the states will force the closure or cutbacks of many of the people-helping programs these folks will need.”
Despite this, Hamilton was upbeat in the long-term.
“I think we will see a change in the policies coming from Washington,” he said. “In the meantime, West Virginia’s coal industry is poised for the future. We have great capacity, committed management teams in place, aggressive business plans, an experienced and qualified workforce and a strong will to succeed. We see coal remaining a major economic driver because it is abundant, affordable and reliable. And we think policymakers will more and more see it as the path to the future.”