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Can Wyoming work with Clean Power Plan?

Forecasts for Wyoming’s dubious coal industry have generated conflicting results: new mine projects and increases in demand and production seem to signal confidence in the industry, but doubt grows as more stringent federal regulations for environmental standards loom in the near future.

It’s easy to see why coal is such a closely-watched asset for Wyoming. The coal industry accounted for 90 percent of the state’s electricity generation in 2013, according to the U.S. Energy Information Administration (EIA), and employed more than 6,500 workers in the same year, according to the Wyoming Mining Association (WMA).

However, the number one coal-producing state in the U.S. currently sits in a precarious position. In a Wyoming Public Radio interview earlier this month, Dr. Robert Godby, director of the Center for Energy Economics and Public Policy, discussed a University of Wyoming study of the state’s coal industry.

He found the results troubling.

“I felt like I was the guy looking into the telescope and being the first one to see the asteroid,” he said in the interview. “…Because we knew this would be bad, just like we know asteroids have hit Earth before, but looking at the first data we had and the first analysis, that’s when we first started to see the scale of this.”

Having reviewed the study, Godby identified three major threats to Wyoming coal production: high production costs, low natural gas prices and less demand for electricity. But he said no factor jeopardizes the Cowboy State’s bread-and-butter industry more than the Obama administration’s Clean Power Plan.

Cleaning up American energy

With the nearly 400 million tons of coal that Wyoming churned out in 2013, it also emitted a considerable amount of carbon dioxide. Several Wyoming coal facilities landed on the U.S. Environmental Protection Agency’s list of top carbon producers: Laramie River Power Station in Platte County ranks as the 17th largest, producing 14 million tons of CO2 and Jim Bridger plant near Point of Rocks ranked 12th with 16 tons.

Emissions of this caliber have been a driving force behind the Clean Power Act, an initiative proposed in June to drive down U.S. emissions by 30 percent over the next 15 years. The EPA’s plan sets a specific carbon reduction goal for each state; if approved, Wyoming would be assigned a 19 percent reduction target.

The proposed plan would certainly trigger significant changes in the state’s energy industry, but could it spell out the undoing of Wyoming’s coal industry? To no one’s surprise, the EPA and coal proponents disagree.

Godby: Expect job loss

Based on the study’s results, Dr. Godby had bleak expectations for the plan’s impact on the state’s economy and workforce. In order to reach its reduction target, the study indicates that Wyoming would have to scale down its coal production by 30 to 50 percent, or by about 200 million tons of coal each year.

“If [approval of the Clean Power Plan] were to happen tomorrow, just to give you a little perspective, it would be somewhere between, at the worst, 7,200 to over 9,000 jobs,” he told Wyoming Public Radio. “We project even more jobs lost when this occurs, 15 years out, but that’s mainly because the economy is larger. So, it’s a lot of people.”

 ‘All-of-the-Above’ Approach

Despite the study’s projections of revenue and job loss, the EPA said they plan to work with coal-producing states like Wyoming to move forward in a sustainable route. In a statement via email, the agency spoke of plans to preserve a “diverse U.S. energy mix” in the future:

“With an all-of-the-above approach, the Clean Power Plan encourages the growing shift toward a more sustainable system that recognizes the importance of reducing carbon pollution while maintaining reliability and a vibrant economy.  EPA’s Clean Power Plan is flexible— reflecting the different needs of different states, and reflecting the important role of states as full partners with the federal government in reducing pollution.”

Through the plan, the EPA intends to help each fuel source reach a working balance of viable production and emission reduction.

“EPA projects that coal will have a 21 percent share of generation and natural gas will have a 32 percent share of generation in 2030 after implementation of the Clean Power Plan,” and EPA representative wrote in an email. “In addition, EPA’s proposed Clean Power Plan for newly constructed power plants provides a path forward for new coal.”

Mead: Not a partnership

Gov. Matt Mead of Wyoming has less confidence in the plan, predicting jobs loss, spikes in energy prices and a pricey budget for implementing carbon reduction. In an email statement, Gov. Mead said he “believes both affordable energy and a clean environment are important and attainable,” but “neither are achieved by this plan.”

“The EPA and states should work as partners to find environmental solutions—The Clean Power Plan is not a partnership,” he said.

Wyoming has joined other coal-reliant states including Alabama, Kansas, Ohio and West Virginia in a lawsuit challenging the plan’s legal footing. The D.C. Circuit Court of Appeals will hear the case in April.

“Wyoming does not believe the EPA has the authority to propose this rule,” Mead said, adding that he plans to “fight any federal proposals that work against the interests of Wyoming.”

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