Columbia University Report Outlines Market Forces Killing The Coal Industry
Blog ››› ››› KEVIN KALHOEFER
A new Columbia University report adds to a wealth of research disproving the right-wing media myth that President Donald Trump can bring back coal jobs and revitalize coal communities by simply rolling back environmental protections enacted by previous administrations.
Conservative media outlets, political commentators, and Trump himself have repeatedly argued that undoing Obama-era environmental protections would reverse the decades-long decline in coal mining employment. But a new in-depth analysis published by researchers at Columbia University's Center on Global Energy Policy throws cold water on this notion, concluding, “President Trump’s efforts to roll back environmental regulations will not materially improve economic conditions in America’s coal communities.”
The report goes into great detail about the factors behind coal’s decline. It finds that the vast majority of the decrease in coal consumption was due to market factors unrelated to federal regulations and that it is “highly unlikely US coal mining employment will return to pre-2015 levels, let alone the industry’s historical highs.” From the April 2017 report (emphasis added):
We found that 49 percent of the decline in domestic US coal consumption was due to the drop in natural gas prices, 26 percent was due to lower than expected electricity demand, and 18 percent was due to growth in renewable energy. Environmental regulations contributed to the decline by accelerating coal power plant retirement, but these were a less significant factor. We also found that changes in the global coal market have played a far greater role in the decline of US production and employment than is generally understood. The recent collapse of Chinese coal demand, especially for metallurgical coal, depressed coal prices around the world and reduced the market for US exports. The decline in global coal prices was a particularly important factor in the recent wave of coal company bankruptcies and resulting threats to the healthcare and pension security of retired US coal miners and their dependents.
Second, the paper examines the prospects for a recovery of US coal production and employment by modeling the impact of President Trump’s executive order and assessing the global coal market outlook. We found that successfully removing President Obama’s environmental regulations has the potential to mitigate the recent decline in US coal consumption, but that will only occur if natural gas prices start to rise. If they remain at current levels, domestic consumption will continue to decline, particularly if renewable energy costs fall faster than expected. We similarly see little prospect of a sustainable recovery in global coal demand growth and seaborne coal prices. Combining our domestic and international market outlook, we believe it is highly unlikely US coal mining employment will return to pre-2015 levels, let alone the industry’s historical highs.
The report’s conclusion that undoing environmental protections will have little impact on coal mining employment aligns with what numerous experts and nonideological media analysts have reported. The researchers also found that the Clean Power Plan (CPP), which regulates emissions from coal-fired power plants and which Trump singled out with a March 28 executive order that rolled back environmental regulations, “played no direct role in the reduction of US coal consumption and production experienced over the past few years.” (The Obama administration announced the final version of the CPP in August 2015 but the rules were never actually implemented.)
The report does note that the decline in coal consumption could be mitigated “if natural gas prices increase going forward,” but the impact on jobs would not be as direct. As Robert W. Godby, an energy economist at the University of Wyoming, explained to The New York Times, even if coal mines stay open, they are “using more mechanization” and “not hiring people. … So even if we saw an increase in coal production, we could see a decrease in coal jobs.”
Notably, the Columbia report offers policy recommendations “for how the federal government can support economic diversification in coal communities through infrastructure investment, abandoned mine land reclamation, tax credits, small business incubation, workforce training, and support for locally driven economic development initiatives.”
But perhaps just as importantly, the researchers offer the following recommendation for lawmakers: “Responsible policymakers should be honest about what’s going on in the US coal sector—including the causes of coal’s decline and unlikeliness of its resurgence—rather than offer false hope that the glory days can be revived.”