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Road to Understanding: Can Trump stop the dethroning of 'King Coal?'

By John Hollenhorst | Posted - Apr 3rd, 2017 @ 8:59pm


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LYNNDYL, Millard County — A giant power plant near Delta has been humming along for three decades, consuming vast amounts of coal. One hundred railcars roll through the plant each day, belly dumping another load of coal every few minutes.

The Intermountain Power Project (IPP) burns about 5 million tons of coal each year to generate electricity for homes and businesses in the Los Angeles area. But IPP's owners have already decided to build a new plant fueled by natural gas. They may decide soon whether to simply demolish the coal plant.

"The coal units will run at least through 2025," said IPP spokesman John Ward. "Folks will look for a way to keep them there if they can. But if the market doesn't support it, then they may go away after that."

The pending decision could be another bellwether for a troubled industry. If there is a war on coal, as President Donald Trump has claimed, he may have trouble turning the tide of battle. Powerful market forces, environmental concerns and emerging worldwide trends suggest that, at best, Trump will have an uphill battle living up to his promise of restoring lost jobs in the coal mining industry.

Many utilities — including some in the Intermountain West — are beginning to move away from coal as the dominant fuel for making electricity. Although coal remains a major player on the energy scene, the long-term trends could have significant impacts on Utah's economy and the lives of some residents who depend on coal for their livelihood.

Owners of IPP, Utah's biggest coal user, have already embraced natural gas as the fuel of the future. A decade from now, new electrical generation units will come online, fired by gas instead of coal. In the next few months, the Intermountain Power Agency board is expected to decide whether that will be the end of the line for coal. They may decide soon to scrap the coal-fired generators after California's power-purchase contracts expire in 2027.

Extending the life of the coal operation beyond that time frame would require major new electricity customers outside of California.

"Substantially all of the electricity that's been generated at the Intermountain Power Project over the last 30 years has gone to six big cities in Southern California," Ward said. "Those cities are prohibited by California state law from purchasing coal-fueled electricity after these current contracts expire."

The challenge to the dominance of coal is underway at many power plants around the West. Near Price, Rocky Mountain Power already demolished the coal-fired plant at Castle Gate, largely because it was physically impractical for the company to install new pollution controls at a plant hemmed in by cliffs.

Near Lake Powell, coal's future looks bleak. A few weeks ago, the owners of the coal-fired Navajo Generating Station at Page, Arizona, decided to scrap the plant beginning in 2019, or even earlier. That would almost certainly force the shutdown of a coal mine jointly owned by the Hopi and Navajo nations. Other coal-fired plants are facing shutdowns in Nevada and New Mexico.

"I think there has been a war on coal," said Mark Compton, president of the Utah Mining Association. "I believe moving away from coal is actually shortsighted and potentially dangerous for our economy."

The issue helped Trump win the election. He blamed President Barack Obama's environmental policies and promised to bring the coal jobs back — but can Trump deliver?

The picture is clearly more complicated than one president's policies. Coal jobs in Utah started dropping dramatically decades ago. As in many industries, high-efficiency machines replaced workers.

"They were still putting out the same amount of coal, maybe more, with a quarter of the workforce," said Mark Knold, senior economist for the Utah Department of Workforce Services. "So there was the sharp employment drops."

Now, coal is up against severe market pressures.

At Lake Powell, the Navajo Generating Station's move away from coal is not primarily driven by environmental policies. It's because of cheap natural gas.

"This is an economic issue; it's not a regulatory issue," said Scott Harelson, a spokesman for one of the power plant's owners, the Salt River Project.

"Natural gas is an increasing competitor," Ward said. "The fracking revolution has made gas more abundant and lower cost, and so (coal companies) have to compete."

Ward also points to a vast restructuring of the energy industry that's underway due to the emergence of alternative energy sources such as solar, wind and geo-thermal power.

Yes, worries about air pollution and climate change definitely shape the playing field: Castle Gate was demolished partly because it couldn't adapt to new clean-air rules.

And IPP?

"This power plant is out of customers in 2027, exactly, because of an environmental policy," Ward said, noting that California's legislature voted to ban coal-fired electricity. After 2027, IPP's coal plants might be worthless.

"New customers would have to be identified who are interested in purchasing that power," Ward said.

But if natural gas is cleaner and cheaper, would any utility buy coal power from IPP?

"From this vantage point, no, it doesn't seem likely," Knold said.

Such trends explain why Utah coal supporters pin their long-term hopes on selling their product to other countries.

"They want a higher standard of living," Compton said. "They want our lifestyle, so coal use is growing worldwide."

Even that premise is under fire. Many countries, even China, seem to be worrying far more than the U.S. about coal's role in warming the climate.

"It's taking a much higher level of importance in those countries," Knold said. "Again, from this vantage point it's difficult to see even another country rescuing the coal industry."

All sides agree, Utah coal production will likely level out for the next decade. After that, the future is much harder to predict. Even now, "King Coal" is no longer a dominant supplier of jobs in Utah. Solar and wind power now put more than twice as many people to work as coal mines.

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