Coal Tattoo

Appalachian Power and the future of coal

We had an interesting story in today’s Gazette based on comments from Appalachian Power President Charles Patton during a meeting yesterday with some newspaper editors here.

During our discussion, Mr. Patton made it clear — as AEP has going back to the day it announced the closures — that the aging, inefficient coal-fired power plants it has targeted for retirement were headed that way, regardless of any new air pollution restrictions from the U.S. Environmental Protection Agency. As we reported:

“The stuff that isn’t scrubbed, the greenhouse gases aren’t the issue,” Patton said. “They’re just so old that it doesn’t make sense to spend the money to make them comply with the existing rules. Under any scenario you looked at, regardless of EPA rules, all those plants were gone anyway.”

Patton also was clear about what’s driving the economics right now for utilities:

Patton predicted that no companies would build any new coal-fired generation anytime soon. He said that low natural gas prices, and not EPA’s proposed rules to limit greenhouse gas emissions are the reason.

“Nobody is building any new coal,” Patton said. “The economics just aren’t there.

“Gas is just so cheap,” he said. “You cannot deny that natural gas is the fuel of choice.”

Patton said that advances in natural gas drilling — such as horizontal drilling and hydraulic fracturing — that have created a boom in the Marcellus Shale region have reduced industry concerns about the price volatility of natural gas over the long term.

“I don’t care what you read, I don’t think anybody is going to build a coal plant, given natural gas prices,” Patton said. “It’s just economics.”

Of course, these kinds of remarks — along the data that clearly shows coal jobs in West Virginia have increased since President Obama took office — greatly undercuts (or perhaps completely blows out of the water) the continued arguments that some sort of Obama administration “war on coal” is destroying jobs and crippling this industry.

But that’s not stopping the taxpayer-funded, anti-Obama, anti-EPA efforts of the West Virginia Coal Association and United Mine Workers officials in charge of the West Virginia Coal Forum. Their three-city tour, which started in Charleston on Tuesday, continued yesterday in Wheeling.  The Wheeling paper reported that West Virginia Senate President Jeff Kessler, D-Marshall, went along with a Republican proposal to urge all U.S. power companies to shut down for a day to show coal industry critics who is boss:

West Virginia Senate President Jeff Kessler, D-Marshall, suggested a specific day for an organized power outage.

“Let’s shut down electrical plants on Superbowl Sunday,” he said. “If people couldn’t watch their televisions, they would realize the influence West Virginia plays on the energy of the nation.”

Sen. Kessler didn’t mention anything about the fact that, if you did that today, the share of power users around the country affected would be about 36 percentfar less than the “nearly half” of all power generation figure that the coal industry and its political friends are fond of citing.

The Coal Forum is continuing this taxpayer-funded coal cheer-leading tour today, with a meeting in Beckley. Gov. Earl Ray Tomblin is scheduled to attend, and his official schedule actually read — despite the clear evidence that factors other than EPA are what’s driving coal’s decline — this way:

Gov. Earl Ray Tomblin will attend the West Virginia Coal Forum. With representatives from both labor and management in the coal industry, The West Virginia Coal Forum focuses on the EPA’s War on Coal and, specifically, the agency’s greenhouse gas and Utility MACT proposed rules.

At the same time, the liberal Credo Action is sponsoring a petition urging Gov. Tomblin to “stop using taxpayer money to promote dirty coal.”  The Coal Forum has its own petition aimed at urging Congress to stop EPA’s initiatives related to coal pollution, but if you look closely, you can copy, delete and then insert whatever message you want into their online-message generator.

But before anti-coal activists jump in and say Appalachian Power’s own comments signal the near-term end of this industry … well, that’s simply not what Mr. Patton said, and the numbers we reported don’t support that notion, either:

The plant closures and proposed transfers would reduce the share of Appalachian’s power generation that comes from coal from 74 percent today to 71 percent in 2015. The share generated from gas would increase from 15 percent to 20 percent over the same time period, officials said.

More broadly, parent company AEP has said coal’s share of its generation will drop from 67 percent in 2011 to 50 percent in 2020. Nationally, government data shows coal’s share of power generation has been dropping for years and reached 36 percent during the first quarter of 2012 — far below the “nearly half” figure frequently cited by coal officials and the industry’s political supporters.

“Coal is going to continue to be here,” Patton said. “But that huge advantage we were getting as coal, we’re not getting that again.”

Remember that coal production in the Central Appalachian region is expected to plummet over the next decade — regardless of what EPA does about mountaintop removal, mercury emissions or global warming.  Every minute Gov. Tomblin, our state’s congressional delegation and other leaders spend in their fight against the “war on coal” is time they aren’t spending planning for how to blunt the impacts of this coal decline on Southern West Virginia and its people.