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Coal industry's future focus of symposium

Nov. 01, 2012 @ 11:15 PM

HUNTINGTON -- Drive down U.S. 23 south of Catlettsburg, Ky., and you'll get a little education on what's going on in the coal industry right now.

The stockpiles of coal are so high on either side of the road that "the sun doesn't come up until 10 in the morning, and it goes down at 3 in the afternoon," said Nick Carter, president and chief operating officer of Natural Resource Partners.

Coal isn't being burned at the same rate it was a year ago, and there are a number of reasons why, not the least of which is the low price of natural gas being drilled in the Marcellus Shale.

Concerns about the future of the coal industry and the jobs it provides, among other concerns about domestic energy production in the United States, were among the highlighted topics Thursday at the Huntington Regional Chamber of Commerce's 2012 Energy and Natural Resource Symposium.

Carter was among a panel of speakers which also included Charles Patton, the president and COO of Appalachian Power, as well as Marshall University President Stephen Kopp and keynote speaker Marita Noon, executive director of the Citizens Alliance for Responsible Energy. They spoke to an audience of about 200 Thursday at the Pullman Plaza Hotel.

People don't pay much attention to energy until the lights go out, or they can't afford it, Noon said, which is evident this week in the aftermath of Hurricane Sandy.

Noon argues it should be a focus all the time, and she said the upcoming election will be pivotal.

"Energy plays a key role in the freedom that we as Americans enjoy, but the energy policies we have right now going on in this country (aren't helping)," she said. "... President Obama wants us to use less but pay more. When you realize the importance that energy plays in America, why would the president want us to use less energy?

"Energy is what makes America great," she said.

"For those of you who have been without power in this region you understand the power of electricity in our lives," she said.

She contends climate change is a farce to create a cycle of funding for Democratic supporters, and that the term "energy independence" is misused, leading Americans to believe the United States depends on other countries for electricity when it really only imports oil used in vehicles. She contends the current administration is not as committed to making the most of the nation's natural resources as keeping their jobs.

Less suppression by federal regulations is critical to bolstering the nation's economy, Noon said.

And the role coal plays in the national economy is something of great concern to West Virginians, Carter said.

Yes, coal burning is down right now, with lower demand as a result of cheap natural gas.

"Last week, the statistics came in from the (Energy Information Administration). In the United States, we produced 19.5 million tons of coal," Carter said. "The same week last year, we mined 22.1 million tons of coal. That's down 11.2 percent."

In southern West Virginia, tonnage of mined coal is down 10 percent from last year, he said.

"Each one of those tons of coal represents jobs and taxes and income to the local states and school boards," Carter said. "It represents jobs at the Walmarts and Joe's Diners and tithe money that goes into the churches and the nonprofits. It's the lifeblood of southern West Virginia."

However, "I think there is reason to be optimistic," Carter said. "Coal for the past 10 years in the world has been the fastest growing fuel, by some distance. ... There is a market for southern West Virginia coal. The question comes back to infrastructure and how do we get the coal to that market. One thing that I think will help our market is the (widening of the Panama Canal, for easier shipping to India and China)."

Some good news domestically, he said, is that of the 288 coal-fired power plants across the country that are being retired in upcoming years, "Most are small, old and unscrubbed. They're at the back end of the dispatch order and are only used in times when you have three feet of snow."

Coal is certainly a viable economic option for utilities, Patton said, but he did say Shale gas is a game-changer.

"Shale gas is the black swan event that is fundamentally changing the dynamics," he said.

"We have been called the Saudi Arabia of coal, and it is foolish for us not to fully exploit that resource," Patton said. "I agree, and I think the EPA is overbearing, and regulations are far more aggressive than they need to be, but our failure to have an energy policy is not a partisan issue.

"We really need to begin to focus on something that's good for the country and have serious dialogue about what we need to do to fully advance all forms of energy."

Appalachian Power customers have seen a 50 percent hike in their rates in recent years as the company upgraded coal plants to meet new EPA regulations, an extremely expensive endeavor. It cost $2.2 billion for four units at the John Amos Power Plant, more than the cost of the plant's construction. Meanwhile, the cost of coal has risen from about $30 a ton in 2001 to $60 or more per ton now, Patton said.

Appalachian Power plans to retire some coal-fired plants and switch some units to natural gas because of its affordability.

"When I look at the people I serve, they have had an incredibly difficult time paying for rate increases I've put upon them," he said. "I know people would find this hard to believe, but I consider myself a guardian of their pocketbook, and I'm going with the cheapest option that is before me."

Kopp talked about efforts at Marshall University to lower energy consumption.

"With rising energy costs, we at universities always try to find silver linings ... and that is how we can reduce our energy utilization and buffer what would be a cost driver for students attending the university," Kopp said.

That has included replacing old heating, cooling and boiler systems and several other measures.

"Just in the last year, we reduced our natural gas utilization by 5 million cubic feet. We reduced water consumption by 2.7 million gallons," he said.

High costs lead to creativity, he said.

Outside the forum, about 20 representatives of the Friends of Blair Mountain organization were protesting surface mining on Blair Mountain, which is an endangered historic site. Blair Mountain Battlefield, the scene of the showdown in 1921 between a miners' army at least 7,000 strong and a 3,000-man defensive force headed by Logan County Sheriff Don Chafin and other law officers, many of whom were on the coal companies' payrolls, was listed in 2006 on the National Trust for Historic Preservation's list of America's 11 Most Endangered Historic Places.