Montana’s Fight in the War on Coal

Looking into the coal industry in Montana gives us a strong insight into the present state of affairs of American coal.  Montana generally ranks around fifth in terms of coal output in the United States, while having the largest amount of reserves, roughly 25 percent of U.S. reserves, or 120 billion tons. Montana’s coal output is currently larger than Canada’s and roughly the same size as India.

By Taylor Rose | February 4, 2015

In 2008, then senator and presidential candidate, Barack Obama declared war on the coal energy sector of the American economy.  Today, his ongoing war on coal is being waged aggressively through Environmental Protection Agency (EPA) mandates.  President Barack Obama’s vision is a world where coal production and use is virtually non-existent.

Though Kentucky, Ohio, West Virginia and Pennsylvania are typically regarded as the icons of American coal production, looking into the coal industry in Montana gives us a strong insight into the present state of affairs of American coal.

Montana generally ranks around fifth for coal output in the United States, while having the largest amount of reserves, roughly 25 percent of all U.S. reserves, or 120 billion tons. Montana’s coal output is currently larger than Canada’s and roughly the same size as India.

Speaking with Bud Clinch, the Executive Director of the Montana Coal Council noted how the “need for coal is decreasing in the United States because of emission restrictions, but worldwide the demand is strong, especially in China, South Korea, the United Kingdom, the Netherlands and Serbia.”

Though for the moment, the anti-coal president has yet to cause a significant dent in the U.S. coal industry, thanks to the massive increase in global demand. Yet, Montana and the United States will struggle to meet the growing demand for two reasons: lack of port expansion and government regulation. The common denominator between these two obstacles is the radical environmentalist lobby.

In other words, the American inability to meet global coal demand is self-imposed.

With regard to government regulations, according to Clinch, “EPA regulations are forcing plants to close because they cannot meet EPA regulations.” Therefore it is not so much that coal production is the major problem, but rather “the EPA and air quality on emissions from a power plant are where the problem is at.”

This is keeping consistent with President Obama’s plans to restrict carbon emissions.

At present, Clinch says that Montana’s “annual production is fairly stable over the last decade of around 42 million tons of coal per year,” however, “this is subject to change as power plants pull back thanks to regulations on CO2 regulations.”

Mike Carey, president of the Ohio Coal Association appearing before Congress testified,  “In 2008, President Obama said, ‘If someone wants to build a new coal-fired power plant they can, but it will bankrupt them because they will be charged a huge sum for all the greenhouse gas that’s being emitted.’”

To further exacerbate the problem, “environmentalists are blocking coal port construction,” Clinch said, explaining that “at the moment there are no ports in the Western USA that export coal…. the only port is in Vancouver and the Canadians are very willing to find ways to expand coal production.”

Though these coal specific ports in Canada function for the time being, the problem is that “ports in British Columbia are operating at capacity and it is difficult for other products to come into port…”

Clinch warns that “if these regulations persist, coal exports to other nations will have to increase…South Korea and China have massive demands….they will find ways to get coal one way or another from Australia or the USA.”

In looking at the future of coal development, Clinch observes that main-stream “Democrats have been temporarily stopped by the GOP and pro-coal Democrats…but nothing advantageous has been passed” and is unlikely to be passed, as long as Obama is in office.

Montana Democrats have even taken a leadership role on this issue, where  last year, Senator Jon Tester and former Senator John Walsh “pushed Senate Finance Committee to include the Indian Coal Production Tax Credit in the next round of tax legislation.”

Even former Democrat Governor Brian Schweitzer has advocated for increasing coal production, as a means to help eliminate poverty and improve America’s national security.

Their reasoning being that “reauthorizing the Indian Coal Production Tax Credit is critical to the financial stability, self-sufficiency and self-determination of several Tribes,” Tester and Walsh said. “Not only does responsible resource development have the potential of reducing unemployment on reservations, it also promotes Tribal sovereignty.”

This echoes Senator Steve Daines’ commonly known statement that Obama’s “war on coal is a war on the Crow people of Montana.”

Senator Daines has taken a leadership role in fighting back against the Obama Administration’s harmful anti-coal policies. In March 2014, when Senator Daines was a Congressman, he introduced the “Preventing Government Waste and Protecting Coal Mining Jobs in America Act,” which “would save American jobs and taxpayer dollars by preventing the Obama Administration from continuing a wasteful process to develop new job-destroying coal regulations.” The bill passed overwhelmingly with bi-partisan support, although then Senate Majority Leader Harry Reid tabled the bill and refused to bring it up for a vote.

Clinch says that at present “90 percent” of coal produced in the United States is used within the United States. However, with the rising power of environmentalists, a gradual shift towards natural gas will become more inevitable.

If no federal legislation is passed to either improve the ability of the American coal industry to meet global demand or at least reign in the EPA’s bureaucratic power, the Montana coal industry will decline and come to resemble the impoverished and high unemployment lands of Appalachia.

Regardless of whatever actions the EPA and Obama Administration take to restrict coal production and use, the global demand will still be there and continue to grow. Either the United States and working class families can benefit from Republican led efforts to restrict the EPA’s authority and expand coal production, or many of these blue-collar areas will languish in indefinite poverty.

(To read more about Obama’s EPA policies toward coal, a detailed account is provided on pp. 24-36 in a paper entitled American Energy Independence: A Policy Review published by the Selous Foundation for Public Policy Research.)

Taylor Rose is a graduate of Liberty University with a B.A. in International Relations from the Helms School of Government. Fluent in English and German he has worked and studied throughout Europe specializing in American and European politics. He is a prolific writer and author of the book Return of the Right an analysis on the revival of Conservatism in the United States and Europe. He is also a contributor to SFPPR News & Analysis.