News Column

Federal Rules Least of Coal Industry's Problems

May 19, 2013
coal industry, regulations, challenges

May 19--To see how mercurial a coal-fired economy can be, look at Wise County in Virginia's southwest corner.

There were about 10 percent more people living there in 1920 than live there today, and the population has gone up and down like a roller coaster over the years. Instead of steady growth, the county and others in Virginia's share of the Central Appalachian coal belt rise and fall with the vagaries of the coal market.

Three forces are now conspiring to make this yet another lean season for towns dependent on the mines.

Natural gas is cheap and plentiful. The boom in the Northeast and elsewhere, abetted by better (or at least more efficient) fracking methods has driven down prices.

It's cheaper to mine coal out west, especially in Wyoming, where two huge surface mines produce more of the nation's coal than all the mines in the Kentucky-West Virginia-Virginia-Tennessee region combined.

And, of course, Obama hates coal.

At least, that's what you might hear from any number of sources perhaps inclined to blame everything from ingrown toenails to bad weather on the president.

It's true that this administration has enforced tougher regulations, both on the mining operations, in an effect to keep entire mountain tops from being scraped off, and coal-fired power plants, because coal dust isn't that healthy to breathe.

The mines in Appalachia are closer to more people than those out West, making the impact of things like slurry spills, polluted drinking water and landslides abetted by denuded hills more severe.

The new, tougher standards have been part of the problem for the coal industry, no doubt. From here, though, they're running a distant third to natural gas and western coal.

Maybe something will make the price of natural gas rise enough to be cost-prohibitive. It's certainly been volatile recently. The price per million British thermal units fell from about $9 four years ago to below $2 last year, and now it's back up around $4.

Maybe the Wyoming surface mining bonanza will tap out. The Appalachian coal fields have seen booms and busts aplenty over the years.

If neither of those things happens, though, we still need a watchdog for the Appalachian fields. Polluted water, sheared-off mountaintops and black-lung disease are worth combating. Without government restrictions, it's hard to see what would keep coal companies, answerable to investors, from doing everything technologically possible to mine every last piece of coal out of the Appalachian hills as quickly and cheaply as possible, environment be damned.

Maybe more stringent rules on natural gas will give coal a boost. There's plenty of concern over the effects of fracking on aquifers, and it's hard to forget that video many of us have seen of the water tap in Pennsylvania with flames coming out of it. EPA oversight could actually benefit the Appalachian coal industry.

One thing's pretty clear, though: If Appalachian coal faces a dim future, the key culprit is not some anti-mining movement in Washington.

Business Editor Howard Owen writes this semiweekly column on business and the economy. He can be reached at 540/374-5539



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