Almost two years after Secretary Sally Jewell called for an “open” conversation about the country’s coal, the Bureau of Land Management released a public review of the national coal program Wednesday.
Issues of concern in the nation’s coal program include transparency in the leasing process, enhanced surface rights for landowners and wasted natural gas from coal mines, according to the BLM.
Billed as a chance to modernize the federal coal program that hasn’t been reassessed since the mid-’80s, this preliminary review summarizes public comments on the program, garnered over the last year.
It also includes a long list of suggestions for policy changes, like increasing royalty rates and adjusting both rental rates and bonus bids to catch up with inflation. The suggestions are packaged in a series of proposed options, each including a bundle of reforms.
The BLM will continue toward developing a final draft, which will include assessments of the reform packages, as well as analysis of continuing the status quo.
Environmentalists in Wyoming largely support revaluing the program, focusing on coal’s impact on the environment via emissions that contribute to climate change, the need for reclamation guarantees and a fair revenue return from coal production on public lands.
“The government needs to regain control over planning and leasing for many reasons,” said Bob LeResche, chairman of Powder River Basin Resource Council from Clearmont, in a statement. “We support the Department’s proposal to conduct a thoughtful analysis and then to realign federal coal management with today’s realities by addressing impacts and markets as they now exist, and to ensure a fair return to coal communities and American taxpayers.”
There is a moratorium on new coal leases until the review process is finished, but the BLM estimates the amount of coal already leased on federal lands could sustain current production levels for another two decades.
Not all are pleased by the federal review.
Sen. John Barrasso of Wyoming said the report proved that the current presidential administration had failed to conduct the coal review “in good faith.”
“The Obama administration has had a predetermined outcome in mind,” he said in a statement Wednesday. “It is now trying to bind President-elect Trump’s hands. This report should be scrapped on President-elect Trump’s first day in office.”
A spokesman for Gillette-based Cloud Peak Energy, which operates the Antelope and Cordero Rojo coal mines in Campbell County, said the review was part of Obama’s “assault on American energy.”
Coal is already a highly taxed industry and closely audited by the federal government, said Rick Curtsinger, of Cloud Peak, in response to the report’s suggestion that coal companies don’t pay enough to the American public.
“The current system works to benefit the American people,” he said. “It delivers over $1 billion a year in royalty revenues alone to federal and state governments. Cloud Peak Energy pays, on average, over 40-percent of the selling price of federal coal in taxes, fees, and royalties, in addition to paying corporate tax on any profits it may make.”
The federal focus on the coal program has caused unease in Wyoming. All of Wyoming’s Powder River Basin mines are on federal lands.
At a public meeting in coal country when this process was just beginning, miners expressed anger and fear that feds would raise royalty rates and deal a deadly blow to the sector.
The coal industry has endured a difficult journey over the last few years, and is facing more challenges to come, competing with cheaper, cleaner natural gas for the lion’s share of the electricity market.
Between 80 and 90 percent of U.S.-produced coal is used for electricity, and almost half of that comes from public lands, largely in the Powder River Basin of Wyoming and Montana.
The review calls for additional analysis of the program before there is a final draft. The process will continue under a new president and Congress. Both Donald Trump and Washington lawmakers have made promises to reduce pressure on coal and coal communities.
The president-elect has said he will ax the moratorium on leases, describing it as a ploy to kill coal by the Obama administration.
However, Jewell, the current Secretary of the Interior, has suggested that the information compiled in the BLM’s report could still be used to fight for reform in the courts, presumably by environmental and land rights groups.
The Trump transition team did not immediately respond to emailed messages seeking comment. Trump’s Interior appointee, Rep. Ryan Zinke, is from Montana, which holds some of the world’s largest untapped coal reserves.
Montana U.S. Sen. Steve Daines dismissed the Interior report as “laughable” and predicted the moratorium would be overturned.
The AP contributed to this report.