If you'd like a better idea of what The Coal Trap is about, the chapter previews provide a general overview of the topics covered in the book.
The years between 2009 and 2019 represent a “lost decade” for West Virginia as its political leaders chose to ignore the fundamental transformation that was underway in the electric industry in the U.S. and instead doubled down on coal. The leadership necessary to manage the state’s transition for success in a new energy economy was missing; rather, the chosen path was to complain about a “war on coal” and largely blame the demise of the coal industry on “Obama’s job-killing EPA.”
The “lost decade” was very active at the federal level in efforts to address climate change, including the adoption of the Clean Power Plan to regulate carbon emissions from coal plants. Although the regulation never took effect, it was claimed to deal a crushing blow to the coal industry by West Virginia political leaders.
The leading cause of the demise of the coal industry was the widespread deployment of hydraulic fracturing and horizontal drilling in the Marcellus Shale, the largest shale play in the U.S. The availability of cheap and plentiful natural gas in the region resulted in dramatic decreases in wholesale electricity prices, making coal plants uneconomic as a means of generating electricity.
By the end of the “lost decade,” technological advances in wind and solar resulted insignificant cost reductions; most utilities across the country were finding that installing a new wind or solar facility would be cheaper that running existing coal plants. Analyses of West Virginia coal plants suggested similar results.
While most electric utilities nationwide were “decarbonizing”—replacing coal with natural gas, wind and solar—due to overwhelming market forces, West Virginia doubled down on coal instead, and largely missed the economic opportunities associated with this clean energy revolution. The other trend in the electric utility industry—decentralization—also bypassed West Virginia, in favor of continued heavy reliance on large coal plants.
Over a two-decade period beginning around 2000, West Virginia went from reliably Democratic to one of the “reddest” states in the country. The decline of the United Mine Workers, and the emergence of the “Friends of Coal,” were major factors in this transition, and the state eagerly embraced the “war on coal” narrative framed by West Virginia politicians.
West Virginia’s Congressional delegation throughout the “lost decade” consistently demonstrated their blind loyalty to the coal industry, with the notable exception of criticisms leveled at coal operators by Senators Robert Byrd and Jay Rockefeller late in their Senate careers when they no longer would face the voters. Meanwhile, Shelley Moore Capito successfully rode the “war on coal” theme to advance from Congress to the Senate.
No politician dominated the political and energy scene in West Virginia during the “lost decade” more than Joe Manchin, first as Governor, then as U.S. Senator, then as the point person on U.S. energy policy as the critical 50th vote in a divided Senate and as Chair of the Energy & Natural Resources Committee. Unfortunately, that leverage was largely used to advance the interests of the fossil fuel industry and the Manchin family’s financial stake in the coal business.
The Public Service Commission is one of the most powerful agencies in West Virginia in shaping energy policies. Unfortunately, that authority has been exercised almost exclusively to adopt policies favoring the coal industry, to the considerable detriment of electric ratepayers. One of the most damaging policies is the agency’s failure to embrace energy efficiency programs, which could give ratepayers the tools to manage their spiraling energy costs.
The West Virginia state legislature also did its part in futilely attempting to prop up the coal industry in the face of overwhelming market forces during the “lost decade.” Leading examples were adopting a worthless energy portfolio standard, authorizing long-term bonds to finance short-term power cost overruns, bailing out an uneconomic coal plant, and sacrificing miner safety to help coal operators reduce costs.
A leading cause of the massive rate increases imposed on electric ratepayers during the “lost decade” was the Public Service Commission’s approval of the transfer of three money-losing coal plants from unregulated into regulated operations, thereby shifting the losses from utility shareholders to utility ratepayers. More recently, the Commission authorized additional spending on these coal plants to keep them open through 2040, in the face of evidence showing that ratepayers would be better off by closing them.
Another West Virginia state agency that miserably failed to do its job is the Department of Environmental Protection, which was charged with ensuring that once coal operators ceased mining operations at a coal mine, there would be sufficient money to clean up the mess. Due to failed program oversight—coupled with the ability of coal operators to shed their environmental remediation obligations in bankruptcy—West Virginia is left with thousands of acres of abandoned and un-reclaimed mine lands.
Although West Virginia faces a challenging future, it is not too late for the state to catch up with the rest of the country in capturing the benefits of the clean energy revolution. The first step is for its political leaders to look forward rather than backward, and to advocate policies that will position the state on a path to compete in the twenty-first century. This chapter identifies some of these suggested policies.
