New federal coal leases paused; some say it doesn’t make difference to the industry
Any new or future coal leases on federal land are now paused following a ruling by a federal judge late last week, and some say this decision likely will not change much for the industry, as coal has already been on the decline nationwide.
The judge ruled that the U.S. Bureau of Land Management (BLM) has to reevaluate the impacts of mining coal on the environment. The ban on new coal leases on federal land was originally put in place during the Obama administration but later repealed by former President Trump.
Shannon Anderson, a staff attorney and organizer with the Powder River Basin Resource Council, said the decision will not likely change a lot in many states, as the economy is shaping coal’s future.
“There's no coal lease applications that are actually moving forward with the BLM right now, because of the overall downturn in the coal industry, and coal fired power plants being retired outside of the state,” Anderson said. “There’s just an overall reduction in market demand for Powder River Basin Coal.”
Wyoming supplies more than 40 percent of the nation's coal. Nationwide, production hit a 50-year low in 2020, and while there has been a slight uptick in the past two years, experts do not expect it to continue.
“No coal mine right now in the country is looking to expand,” Anderson said. “Mines are using existing leases and reserves that they've already bought from the federal government, and they're not really looking to expand.”
For example, Wyoming has not sold a federal coal lease since 2012. Reports show coal consumption will decrease over the coming years, as renewable energy and natural gas continue to become cheaper alternatives.
However, Wyoming Governor Mark Gordon said in a press release, pausing new federal coal leases is a bad decision for Wyoming.
“It hurts our country’s ability to provide reliable, low-cost energy to Americans and hinders the abilities of companies to plan and invest in new technologies like carbon capture and utilization,” Gordon said.
The state of Wyoming, under the guidance of Gordon, is pursuing a number of carbon capture initiatives and has invested millions into the technology. Burning coal is considered one of the largest sources of global greenhouse gas emissions, and some say carbon capture could reduce the impacts by capturing and storing the emissions before they are released into the atmosphere.
“Wyoming is serious about using carbon capture technologies to keep our vital coal plants contributing to the economy into the future,” Gordon said in a 2019 announcement of a carbon capture partnership. “Coal can be part of the solution. By removing CO2 and finding uses for it, we can make coal-fired power part of a low-carbon economy, and carbon capture and sequestration technologies are ideal for many of our plants.”
Notably, some environmental groups do not believe carbon capture will help with climate change as it will prolong the life of the fossil fuel industry.
In the meantime, the recent court decision will not affect current leases and ongoing coal mining. The BLM will have to conduct a new environmental review that considers climate damage from coal mining before the agency can resume coal lease sales.
This decision comes after a federal judge rejected the BLM’s resource management plans for the Powder River Basin, effectively pausing all new pending coal, oil and natural gas leases in the area, until a lengthy environmental review is completed that meets the judge’s requests.