In 2015 and 2016, three massive coal companies in Wyoming filed for Chapter 11 bankruptcy: Arch Coal, Alpha Natural Resources and Peabody Energy.
"The national story was [that] this is the warning for coal," said Rob Godby, an energy economist at the University of Wyoming.
Nearly 500 people were laid off in a day back then. Workers lost millions of dollars-worth of retirement benefits. But all that wasn't caused by Wyoming coal, Godby said; rather, heavy investment into metallurgical coal that turned sour.
This year, though, Godby said, is different. A massive utility is looking to close several Wyoming coal plants early. Arch and Peabody are merging operations to have a better shot against natural gas. And three coal companies - Westmoreland, Cloud Peak Energy, and Blackjewel - went bankrupt. Godby said it's all connected.
"The problem here now is your core business is not nearly as stable."
It's not as if something changed dramatically with coal itself. The prices certainly didn't. But the world changed around it. Natural gas, wind and solar became much more competitive for electric utilities, which drove coal production down with it. Natural gas prices have dropped by half from a decade ago. The cost of generating wind and solar fell by even more. And coal production fell right along with it.
This drop pushed three coal companies to a point where they weren't generating enough cash. So, they filed for bankruptcy. One based on the weakness of Wyoming thermal coal demand, and that makes this year notable to Godby.
Cloud Peak was seen as a great manager, and Westmoreland had a price edge by sitting next to a power plant. Yet, they both struggled. Blackjewel was in a worse position, and it has dramatically showed the world how difficult it is to secure any financing for coal.
In one hearing, Wyoming Representative Liz Cheney argued thermal coal wasn't the problem, rather regulation.
"There's no question that that the policies that were adopted by the Obama administration were an attempt to kill coal. That's exactly what the Clean Power Plan was. And those have had an impact, we continue to feel the pain of those," said Cheney. The Clean Power Plan never went into effect.
Godby said the threat of regulation over greenhouse gases and the coal industry was not as immediate or impactful as the market forces themselves.
"Certainly, it posed a potential threat one day. But unfortunately, that distraction in part led to people ignoring what implications of these new technologies like fracking and renewables really meant to the electricity market and how much the electricity market would really change," he said.
Now, companies are forced to adjust either voluntarily or by law to an electricity market that no longer favors coal.
"2019 in Wyoming should really be considered a watershed year where we're getting a major restructuring of the coal industry in Wyoming and in the Powder River Basin," Godby said.
A State Response
Wyoming isn't blind to changes underway. The state's joint revenue committee recently discussed the issue because the decline of coal has a big effect on state revenue. The Governor's chief of staff Buck McVeigh introduced a taskforce called the Energy Futures group. It will look for new revenue streams, perhaps new taxes to fill in the gaps left by coal. He said they need something to happen fast.
"We obviously cannot wait 20 years for something like this. We can't wait 10 years. This has to be an endeavor that's going to come together within this year," McVeigh said.
In a later interview, Governor Mark Gordon agreed. There have been steps forward in diversification, but the state will have to speed up. He said he's confident it can happen, though it may not be a smooth transition.
"None of that happens overnight. I'm fully anticipating we're going to have a few hopefully not more than one or two- really, pretty tight years. But as we emerge on the other side, I think we're better able to pivot than a lot of other economies," Gordon said.
He added maybe the time crunch will force positive change.
"We tend to have to sort of be pushed to the brink before we appreciate what the opportunities are and the challenges," Gordon said, while laughing.
Despite all that, Gordon does expect the coal industry to stabilize: it's always had booms and busts. But Godby, an energy economist, said it's different now. The trend for coal demand isn't expected to rebound. It's been racing downward since 2009, to the tune of about 30 percent with no sign of recovery.
Based on numbers from a Moody's Investor Service projection, coal production will continue that trend. It could fall by more than half in the Powder River Basin by 2030 save for a breakthrough in carbon capture technology or a mandate to end natural gas production. Godby said that's shocking.
"Since World War II, the electricity market has been pretty stable, coal produced most of the energy." He said, "and in a decade, that's turned upside down."
Taylor Kuykendall, a coal reporter with S & P Global Market Intelligence, said there is still a place for Powder River Basin coal. There will be changes, though.
"I think more and more we're seeing the coal industry kind of brace to be much smaller than it was in the past," he said.
In other words, it's bracing for consolidation or restructuring, something Wyoming has already seen this year with Arch and Peabody merging seven of its mines. The move allows them to streamline operations and save about $800 million. The companies hope to use it to better compete with natural gas. It also gives them more control over supply.
"That consolidation of that basin would go a long way towards allowing them to negotiate better prices [and] support kind of a longer-term health of the companies," Kuykendall said.
Consolidation will mean big companies, but it will also mean the loss of smaller companies and mines here today. One expert points to Blackjewel, which is careening towards liquidation of its assets, and to Cloud Peak, which tried unsuccessfully for months to find buyers for its mines. Kuykendall and Godby agreed, this year the natural economic gravity set in.
Restructuring will also lead to changes in how the state funds itself. Declining coal revenue will leave holes in education funding, for example.
In Cheyenne, at that joint revenue meeting, Senator Cale Case said they have little choice but to consider new paths.
"[It] doesn't matter whether you are global warming believer or not. The realism is the world is changing. Now the question is how fast?" He said.
It looks fast. This past April, renewables collectively overtook coal in total electricity generation. This summer, analysts expect natural gas to be at its lowest price in 20 years.