To every story, a creation myth. Americans believe that goosing domestic coal production spurs energy independence. No matter that consumption trends reflect a plummeting national demand. (TransAlta’s coal-fired plant, the last of its kind in Washington, shutters in 2025.)
Domestic coal consumption peaked around 2008, at just over 70 million tons per month. Today that number hovers around 50 million. Less expensive and cleaner natural gas, attenuating energy needs, and more renewable energy sources have coalesced to staunch our coal appetite. U.S coal producers now look to an energy-ravenous China to backfill a shrinking domestic market. Exports — not energy security — are the driver.
The Powder River Basin, just east of Wyoming’s Big Horn Mountains, is America’s coal Eden, with 40 billion tons of extractable reserves. Presupposing the Gateway Pacific Terminal at Cherry Point passes federal muster, the basin’s Decker and Black Thunder mines will be the launching point for 18 open-car coal trains running daily through the Pacific Northwest. It’s mostly low-sulfur coal, a quality that makes it ideal for an American market subject to the Clean Air Act. China, alas, disregards similar environmental and clean-air standards.
Ironically, most of the Powder River Basin’s Asia-bound coal is mined from publically owned lands. The government leases reserves at below-market prices, in what pencils out to a $29 billion subsidy. The bow wave of costs related to exporting, including infrastructure and economic impacts, will mostly be shouldered by taxpayers. The upside is the promise of jobs, both direct and indirect to Cherry Point. Project construction will translate into approximately 2,000 jobs. After that, supporters forecast 215 full-time positions.
At capacity, Cherry Point will export 48 million metric tons of coal a year. It would mark a sea change in the export sphere. The U.S. currently exports around 100 million tons of coal annually, with less than 10 percent shipping from West Coast ports. In addition to Cherry Point, the proposed Millennium Bulk Terminal in Longview would annually export 44 metric tons. The environmental impact statement (EIS) process for Longview is slated for early 2013.
There are compelling reasons to avoid telescoping coal exports into questions of NIMBY-ism, transportation hassles, or additional living-wage jobs. A long-lens perspective incorporates who is paying for what, the spectrum of environmental impacts, and where the country will be a generation or two from now. These questions mirror the spirit of the National Environmental Policy Act, as well as the law’s EIS process to gauge Cherry Point along with the Millennium Bulk Terminal. And the story begins hundreds of miles east of Washington, in the Powder River Basin.