By David Dodson
November 1, 2021 - If coal export advocates are serious about preserving jobs and building a bridge to a post-coal economy, then our politicians need to cut a deal, a green deal, and do it right away.
The fastest and simplest way to both reduce carbon emissions, and bolster Wyoming’s coal industry, is to displace Russian and Indonesian coal with Wyoming’s cleaner burning coal. And thanks to a unique set of political circumstances, we have a fleeting opportunity to accomplish that right now.
While 62% of our country’s bituminous and subbituminous coal mines have closed since 2008, China’s appetite for coal is so great that they can’t get enough of it, leading to severe electricity cutbacks and periodic blackouts. That’s bad news for environmentalists and an enormous opportunity for Wyoming.
Wyoming’s coal burns hot and efficiently and has a lower sulfur content compared to most other forms of coal. Lignite coal, found in countries like Indonesia and Russia, has not been under as many centuries of geological squeezing, which leaves it with a higher moisture content and a crumbly texture. That leads to a lower heating value, which means it takes more coal to produce each megawatt of electricity. Every ton of Indonesian and Russian coal displaced by Wyoming coal reduces greenhouse gas emissions.
Last year China built a whopping 38 gigawatts of coal-fired electrical capacity, which was nearly equal to all worldwide retirements combined. This not only means their capacity is expanding, but the young age of their coal power plant fleet means China’s requirement for coal will continue for decades. And while they produce the most coal in the world, China also consumes the most, leaving them to import between 250 and 300 million tons of coal every year (that’s about half of the total coal consumption in the entire U.S.).
This demand is principally met by lignite coal imported from Russia and Indonesia, raising the price of lignite coal and making Wyoming coal cleaner and cheaper on a relative basis. As Bloomberg news puts it, “China is paying the most on record for the dirtiest type of coal.”
Cindy Baxter, an environmental campaigner, says about the use of lignite coal, “Not only are we burning more coal, (but) it’s the dirtiest coal. And it comes from Indonesia where the conditions and the mining is appalling.”
Due to a rare procedural situation, President Biden’s infrastructure bill only needs the support of 50 senators. That is an opportunity not to be missed.
Senators Barrasso and Lummis can cut about any deal they want if they’re prepared to put Wyoming families before their political party loyalties. For most of our history, Washington legislators have cut deals and crossed party lines for the betterment of their constituents, and Wyoming desperately needs that courage and leadership in this extraordinary moment in legislative history.
With the environmental argument in hand, our Washington delegation could require funding for port facilities, improved rail lines, and the equipment to reduce coal dust that would facilitate environmentally safe and economic rail transportation to the Columbia River. In return, to pass the bill they agree to some electric vehicle charging stations in states that want them, and wind turbines off the coast of Massachusetts and Rhode Island — a small price to pay for saving our state’s economy. And as part of this grand bargain, Biden gets the state of Oregon to bless the plan. That’s exactly the type of old-school horse trading we need if we’re serious about saving Wyoming’s economy and jobs.
Wyoming coal producers may have a constitutional right to transport coal to Oregon, but even the Trump Administration’s own Solicitor General didn’t think the suit was worth his time. Which is why more chest-thumping sound bites outside closed coal mines won’t do a laid off Wyoming worker any good.
The environmentalists keeping our coal out of Oregon are holding a royal flush against our pair of twos. Let’s be smart and play the better hand — which is to press the environmental case for exporting coal, and to do it when we have a pair of valuable Senate votes to offer in return.
David Dodson is a resident of Wyoming and an entrepreneur who has helped create over 20,000 private sector jobs. In 2018, he was a candidate in the Republican Primary for Wyoming’s US Senate. He is on the faculty of the Stanford Graduate School of Business, where he teaches courses on small business and entrepreneurship. He is a frequent guest on Fox Business and CNBC.