The Obama Administration Announces Overhaul Of Federal Coal Leasing Program
The last time rules for coal mining on tax-payer public lands were updated, smoking was allowed on airplanes, airbags weren’t required in cars, and sewage was still dumped into the ocean. But today, the Obama administration announced a package of reforms to modernize and reform the federal coal leasing program. Interior Secretary Sally Jewell announced the plan, saying it was long past time to re-examine the coal-leasing program. “It is abundantly clear that times are different in the energy sector now than they were 30 years ago, and we must undertake a review and that’s what we need to do as responsible stewards of the nation’s assets,” she said.
The plan includes three measures to update the federal coal program to account for taxpayer interests and environmental challenges: The U.S. Department of the Interior will conduct a review to identify potential reforms to the program, direct the U.S. Geological Survey to begin annual tracking and reporting on greenhouse gas emissions that come from fossil fuel extraction on public lands, and put a temporary pause on new coal leasing, which will not apply to existing leases.
Coal companies currently have stockpiled billions of tons of unmined coal that is ready to be developed, so a targeted pause on leasing will likely have no impact on jobs, coal production, energy prices, or grid reliability. But it will keep at least 3.5 billion tons of coal from being added to the already-enormous stockpile coal companies have on public lands and allow time to figure out how to best change the current program to ensure taxpayers get their fair share from coal mined on public lands.
The current federal coal-leasing program is fundamentally noncompetitive. Under the current system, taxpayers are missing out on millions of dollars in royalties from leasing energy sources on public lands. Offshore oil and gas drilling is subject to an 18.5 percent royalty charge, but coal companies only pay a 12.5 percent royalty rate for mining on federal lands. Furthermore, royalty rate reductions, loopholes, subsidies, and self-dealing transactions further reduce the effective royalty rate coal companies pay to less than 5 percent. Because the current system fails to ensure mining companies pay royalties on the true market price of the coal they extract, coal companies are able to take advantage of billions of dollars of de facto subsidies.
A flawed royalty system is not the only way the true cost of coal is being undervalued. The environmental impacts of coal, including its contribution to climate change, also impose a cost to the American public. More than 57 percent of all emissions from fossil fuel production on federal lands comes from the combustion of coal. Coal mining in the Powder River Basin alone, which spans across Wyoming and Montana, is responsible for 10 percent of all greenhouse gas emissions in the U.S.
Strip mining and failed mine reclamation produce air and water pollution, which add to coal’s environmental costs. Furthermore, some companies are trying to get out of their responsibility to clean up their mines on public lands, which could leave taxpayers holding the bag for billions of dollars in reclamation costs.
BOTTOM LINE: Not much has stayed the same since the 1980s and the energy sector is no exception. Reform of the federal coal program is long overdue. The Obama Administration’s steps to modernize and reform the program will help reduce the environmental and climate impacts, ensure that taxpayers are getting a fair return, increase transparency and accountability, and hold companies responsible for cleaning up their mining operations.
On Monday, the Environmental Protection Agency will release a first-ever set of regulations to cut carbon dioxide emissions from the country’s existing fleet of power plants. The agency recently issued similar rules for new power plants, which will be finalized next year after a public comment period. The rules for existing plants will undergo a similar process.
But before the political storm around the rules begins in earnest, here are the basic points everyone needs to know about why EPA’s carbon rules are so important.
It’s The First Step Towards A Global Solution
One of the points the Chamber of Commerce made Wednesdayin their premature analysis of the EPA regulations was that, by 2030, the cuts would only amount to 1.8 percent of the world’s annual carbon dioxide emissions. The point is technically accurate — climate change and the greenhouse gas emissions driving it are a global problem — but it assumes U.S. policy occurs in a weird sort of civilizational vacuum.
The projections of future emissions the Chamber used are based on the assumption that business-as-usual continues and that various countries’ climate policies don’t change much. That, in turn, is an assumption about how countries will behave in the future. But as Obama has made clear, half the point of the new regulations is to change the way other countries behave.
America may be the world’s second-biggest carbon emitter, but it remains by far the largest on a per-person basis. It’s also emitted more than any other country historically. And while China and India’s economies are huge, they’re spread over far larger populations than the U.S., and they’re still trying to lift hundreds of millions of their citizens out of very deep poverty. So Americans effectively emitted their way to our current prosperity. Furthermore, because we have so much more wealth per person, we have far more economic room to cut carbon emissions and take risks on developing clean energy than China or India.
What this all means is that trust and goodwill between countries is enormously important to building a cooperative international response to climate change. Because of its position and prosperity, the United States can’t build that goodwill without taking the initiative to cut its own emissions: “It’s not [that] I’m ignorant of the fact that these emerging countries are going to be a bigger problem than us,” Obama told the New Yorker a few months ago. “It’s because it’s very hard for me to get in that conversation if we’re making no effort.”
So when the next round of global climate talks occurs in 2015, we’ll have a far better chance of actually locking down an international treaty to cut global emissions if the United States has already stepped up. Then we can bring other countries on board with their cuts, and then circle back around in a few years for an agreement to cut more. And suddenly that 1.8 percent isn’t a mere 1.8 percent anymore.
“American influence is always stronger when we lead by example,” Obama said yesterday at West Point. “We cannot exempt ourselves from the rules that apply to everyone else.”
Climate Change Is A Threat To America And The World
Because carbon dioxide molecules absorb heat well, the more we dump into the atmosphere by burning fossil fuels, the more heat the atmosphere can absorb. This raises the overall temperature of the Earth as a system, in what’s called the “greenhouse effect” — carbon dioxide and other gases trap heat within the atmosphere, like the glass walls of a greenhouse trap heat within its interior. We can actually measure it: satellites have trackedthe heat imbalance as the Earth absorbs more energy from the sun, while ice cores and other measurements show a a long period of climate stability going back thousands of years, followed by a sudden spike in carbon dioxide and global temperatures around the arrival of the fossil fuel-powered Industrial Revolution.
What does all this mean for the Earth’s climate? Hotter average global temperatures mean more heat waves, more wildfires, and faster evaporation leading to more drought. But it also means more moisture in the atmosphere, so precipitation becomes heavier when it does come, and wetter areas become wetter while dry areas become drier. Sea levels rise from ice melt at the poles and cyclones become stronger from the oceans’ rising heat content, leading to more flooding and storm damage on the coasts. The poles heat up faster than the equator, destabilizing global weather patterns. Species and ecosystems collapse on both land and sea as climate change and ocean acidification alter their habitats. Crop production and food supplies are upended, fresh water becomes harder to come by, and vectors for pests and disease increase. Basically, rising global temperatures shift the range of possible weather so that destructive and extreme events become more likely.
The scientific consensus is that global temperatures can warm 2°C before those changes become truly catastrophic, though some research suggests even that threshold is too much. At humanity’s current rate of carbon dioxide emissions, we’re set to blow past that limit and get somewhere near 5°C of warming by 2100. Simply put, that would bring a degree of climate change far beyond anything that’s occurred the entire time human civilization has been on the planet. It might not even be possible, much less likely, for us to adapt to those circumstances.
U.S. Carbon Emissions Are A Sizable Part Of The Problem
At about 14.5 percent of 2012′s global emissions, the United States is the world’s second-biggest producer of carbon dioxide, with China now in first and India in third. That same year, electricity generation made up almost a third of the greenhouse gas emissions from America’s economy, with cars and other vehicles also making up close to a third, and industry emitting a fifth. The rest was filled in by commercial and residential buildings and agriculture, each for a tenth a pop.
EPA’s rules for new and existing power plants will address the electricity sector only, but the rest of President Obama’s climate action plan aims to use the executive branch’s regulatory authority to cut emissions from those other sectors as well — by ratcheting up emission standards for cars, improving energy efficiency in homes and buildings, changing forestry and land-use practices, and plugging the various holes in our economy that release other greenhouse gases such as methane.
So while the carbon dioxide pumped out by America’s power plants is ultimately only a slice of the problem, the regulations to cut them down are the central pillar of the Obama Administration’s interlocking effort to reduce greenhouse gas emissions in every sector of the economy. And the political, social, and economic effort to sustain that central push will flow into all the other efforts as well.
Congress Isn’t Going To Do It Anytime Soon
It’s been well-documented by political scientists that partisan polarizationhas increased significantly in the legislative branch over the last few decades, meaning both parties — but the Republicans especially — move more in ideological lockstep.
In 2009, when the Democrats still dominated Congress, that unity actually helped them pass bills like the stimulus, financial regulatory reform, and Obamacare. But policies to cut carbon emissions are different. The benefits are spread across the entire population, and are still mostly to come in the future, while the costs will be here and now and fall the hardest on some specific and very influential groups — namely the fossil fuel industry. So when President Obama and the Democrats tried to push a cap-and-trade bill through Congress that year, moderate Democrats — especially in the coal-dependent states like West Virginia and Kentucky — felt enormous pressure to jump ship. And moderate Republicans were pressured by their own ideological cohort to not jump on board.
As a result, cap-and-trade passed the House but went down to defeat in the Senate. Now that the Republicans have taken back the House, the situation is even worse for climate policy, and it will likely take several election cycles before another chance emerges for Congress to pass something. And we simply don’t have that much time. Global carbon emissions quite literally need to peakwithin the next few years and then start falling fast if we want a good shot at staying below the 2°C threshold.
Fortunately, Congress has actually already handed the executive branch the tools to address this problem. Amendments to the Clean Air Act in 1990 require EPA to regulate emissions that threaten public welfare, and in 2007 the Supreme Court ruled the agency could regulate carbon dioxide emissions if it found they posed such a threat. EPA came to that exact conclusion in 2009, citing the rising seas, stronger storms, heavier floods, more intense heat waves, disrupted food supplies, shrinking fresh water supplies, and increased vectors for disease climate change would bring. By carrying through with the new regulations, the Obama Administration and EPA are in fact carrying out the will of Congress — just not the will of this particular batch of congress members.
Tell President Obama: Don’t appoint fracking proponent Dr. Ernest Moniz to lead the Department of Energy
President Obama keeps saying we need to confront climate change. Yet it’s rumored he’s considering nominating Dr. Ernest Moniz to lead DOE. “As a proponent of fracking, Dr. Ernest Moniz is the wrong choice for to lead the Department of Energy. Appoint an energy secretary who will move us away from toxic, climate-heating fossil fuels and toward sustainable energy.”
So why is he considering appointing a major proponent of fracking to lead the Department of Energy?
According to Reuters, President Obama is seriously considering appointing Dr. Ernest Moniz – the director of MIT’s Big Oil-sponsored Energy Institute and a big believer in expanding toxic, climate-heating gas fracking.1
At a time when the last thing we should be doing is undermining our progress against climate change, Moniz is the wrong choice to head one of the most important agencies in the fight for a sustainable energy future.
Moniz’s Energy Institute at MIT is sponsored by the likes of BP, Chevron and Saudi Aramco. So it is no surprise that the gas industry and pro-fracking groups welcomed the rumor of Moniz’s appointment to head DOE.2
Moniz is a strong backer of the deeply flawed notion that we should expand our fracking infrastructure and development to serve as a “bridge” to low-carbon sources of energy.
But fracking isn’t a bridge to a better future; it’s an expressway to climate change and toxic pollution. Expanding fracking will worsen its toxic air pollution and increase its huge volumes of toxic wastewater, will increase incidents of groundwater contamination, and will unleash an absolutely catastrophic amount of greenhouse gas3 — not just through burning gas, but through the tremendous leakage from fracking wells of methane, a greenhouse gas that has 20 times the heat-trapping power of C02 over 100 years, making fracked gas as bad for the climate than burning coal.
What’s more, heavy reliance on burning gas slows the implementation of the sustainable carbon-free sources of energy that will put a dent in our climate emissions.
Climate change won’t be solved by tradeoffs, compromises, or moderate-sounding catch phrases like “all of the above.” President Obama cannot make a serious attempt at confronting climate change as long as he is pushing policies to “encourage” fracking and appointing administration officials who will undermine the progress he could be making.
This week, we delivered to the White House our open letter co-signed by over 240,000 people, calling on President Obama to lead on climate change and abandon his “all of the above” energy policy. But he still doubled down in his State of the Union address. By publicly protesting one of his rumored top picks for Energy secretary, we know that he’ll hear the message.