Wyoming’s coal industry faces uncertain future

New study examines threats to state’s coal-dependent economy.

 

Wyoming depends on coal. In February, a team led by University of Wyoming economist Robert Godby released a study that demonstrates just how much. They found that revenues from Wyoming’s 400 million annual tons of coal production pay for over 11 percent of the state’s educational and government costs, and that coal accounts for around 14 percent of its economy, and 6 percent of its overall employment.

“The purpose of this study was to get an objective view of our coal economy, and find its biggest threats for the state to be watching,” Godby says.

When Godby began the state-funded study in spring of 2014, that economy had been on a 6-year-long decline, for several reasons.  A rise in demand for cheaper natural gas and renewables coincided with increasing coal production costs, due to the fact that coal companies have had to scrape deeper into Wyoming’s coal-rich Powder River Basin. Nationwide, electricity demand has slumped since the 2008 recession. Increased train congestion from the Bakken oil fields has slowed down coal transport. And finally, a trend of worldwide health and environmental regulations has curbed both international export and U.S. production.

The greatest threat of the bunch was the increasing cost of coal mining. That factor alone, Godby predicted, could cut Wyoming’s coal production by 20 percent by 2030, resulting in lost jobs and fewer dollars in Wyoming’s economy, but also resulting in increased revenues for Wyoming’s schools and government thanks to higher coal prices.

An open-pit coal mine in Wyoming. Photograph courtesy of BLM.

Then in June 2014, a few months into the study, the EPA issued its Clean Power Plan proposal, which would require, by 2030, a 30 percent reduction in national carbon dioxide emissions from 2005 levels. Under the plan, each state would have a specific target. Wyoming, the highest CO2 emitter per-capita in the nation, would have to reduce its output by 19 percent from 2012 levels.   

“Coal releases the most greenhouse gas, so the obvious way to reduce greenhouse gas is to reduce coal,” Godby says. With utilities in the other 49 states buying 93 percent of Wyoming’s coal, those nation-wide emissions cuts would have a major impact on the state, which produces over 40 percent of the country’s coal. A lack of viable coal export terminals would curb Wyoming’s ability to sell that coal further afield—not to mention that the trends in increased regulation and decreased demand for coal extend beyond U.S. borders.

The study predicts EPA’s plan could cause Wyoming coal production to fall by 20-45 percent by 2030, resulting in up to 10 percent unemployment in some parts of the state.

The same regulations that knock coal could benefit another of Wyoming’s powerhouse industries: natural gas. Even renewables like wind, of which Wyoming has plenty, might profit from increased demand. But these successes would not be enough to offset the massive losses to Wyoming’s economy. Natural gas would make up for about 40 percent of the coal industry’s dearth, and renewables would employ only a small fraction of the people. “A major wind farm employs maybe 250 people,” Godby says.  “Coal mines can employ 6,000 people.”

The EPA’s proposed rule allows for flexibility in how states approach the carbon reduction goals. While cutting coal use nation-wide seems like a no-brainer, Wyoming is hoping other states give coal a chance, instead looking to greater power efficiency.

Wyoming itself, where utilities are roughly 90 percent coal-powered, is looking to clean coal and carbon capture technology. “There have been tremendous steps in clean coal technology recently,” says Loyd Drain, director of Wyoming Infrastructure Authority, which funded the study. “We think the federal government should partner with the industry and incentivize the development of (that) technology.” But Godby’s report did not evaluate the possible role of clean coal technology in mitigating the plan’s effects. “(That technology) is not current enough,” he says.

Hoping for an easier solution, a dozen states, including Wyoming and four other coal-producers, are suing the EPA over its new plan. Their case will appear in the D.C. Circuit Court of Appeals later this month.

Meanwhile, as coal declines, Wyoming looks to other components of its economy. The state has one of the largest agricultural economies in the country, raising much of the nation’s beef and grain. But agricultural jobs and output are predicted to take a hit from climate change as Wyoming faces future drought. EPA’s new plan, even as it dials back coal’s contribution to the state’s economy, could, to some extent, mitigate some of climate change’s impacts on other sectors. “It’s not just agriculture, but tourism, and more,” Godby says. “We didn’t even try to figure climate change into the study. We’re still in the early stages of understanding climate change and what it will affect.”

Kindra McQuillan is an editorial intern with High Country News.

High Country News Classifieds
  • OPERATIONS DIRECTOR
    We are a Santa Fe-based nonprofit that builds resilience on arid working lands. We foster ecological, economic, and social health through education, innovation, and collaboration....
  • COMMUNITY ORGANIZER
    Come work alongside everyday Montanans to project our clean air, water, and build thriving communities! Competitive salary, health insurance, pension, generous vacation time and sabbatical....
  • CAMPAIGN MANAGER
    Oregon Natural Desert Association (ONDA), a nonprofit conservation organization dedicated to protecting, defending and restoring Oregon's high desert, seeks a Campaign Manager to works as...
  • HECHO DEPUTY DIRECTOR
    Hispanics Enjoying Camping, Hunting, and the Outdoors (HECHO) was created in 2013 to help fulfill our duty to conserve and protect our public lands for...
  • REGIONAL REPRESENTATIVE, COLUMBIA CASCADES
    The Regional Representative serves as PCTA's primary staff on the ground along the trail working closely with staff, volunteers, and nonprofit and agency partners. This...
  • FINANCE AND OPERATIONS DIRECTOR
    The Montana Land Reliance (MLR) seeks a full-time Finance and Operations Director to manage the internal functions of MLR and its nonprofit affiliates. Key areas...
  • DIRECTOR OF CONSERVATION
    The Nature Conservancy is recruiting for a Director of Conservation. Provides strategic leadership and support for all of the Conservancy's conservation work in Arizona. The...
  • EXECUTIVE DIRECTOR
    The Amargosa Conservancy (AC), a conservation nonprofit dedicated to standing up for water and biodiversity in the Death Valley region, seeks an executive director to...
  • BIG BASIN SENIOR PROJECT PLANNER - CLIMATE ADAPTATION & RESILIENCE
    Parks California Big Basin Senior Project Planner - Climate Adaptation & Resilience ORGANIZATION BACKGROUND Parks California is a new organization working to ensure that our...
  • CUSTOMER SERVICE ASSISTANT - (PART-TIME)
    High Country News, an award-winning media organization covering the communities and environment of the Western United States, seeks a part-time Customer Service Assistant, based at...
  • SCIENCE PROJECT MANAGER
    About Long Live the Kings (LLTK) Our mission is to restore wild salmon and steelhead and support sustainable fishing in the Pacific Northwest. Since 1986,...
  • HUMAN RESOURCES GENERALIST
    Honor the Earth is an affirmative action/equal opportunity employer and does not discriminate based on identity. Indigenous people, people of color, Two-Spirit or LGBTQA+ people,...
  • DEVELOPMENT DIRECTOR
    Colorado Trout Unlimited seeks an individual with successful development experience, strong interpersonal skills, and a deep commitment to coldwater conservation to serve as the organization's...
  • NEW BOOK BY AWARD-WINNING WILDLIFE BIOLOGIST, BRUCE SMITH
    In a perilous place at the roof of the world, an orphaned mountain goat is rescued from certain death by a mysterious raven.This middle-grade novel,...
  • DESCHUTES LAND TRUST VOLUNTEER PROGRAM MANAGER
    The Deschutes Land Trust is seeking an experienced Volunteer Program Manager to join its dedicated team! Deschutes Land Trust conserves and cares for the lands...
  • PROGRAM DIRECTOR
    Now hiring a full-time, remote Program Director for the Society for Wilderness Stewardship! Come help us promote excellence in the professional practice of wilderness stewardship,...
  • WYOMING COMMUNITY PARTNERSHIPS COORDINATOR
    The Theodore Roosevelt Conservation Partnership is seeking Coordinator to implement public education and advocacy campaigns in the Cowboy State to unite and amplify hunter, angler,...
  • ASSISTANT TOWN ATTORNEY
    Town of Jackson, Wyoming, $66,700 - $88,000 DOQ, full benefits. Law Degree Required. Rental housing options available. For a complete job description and to apply,...
  • MOUNTAIN LOTS FOR SALE
    Multiple lots in gated community only 5 miles from Great Sand Dunes National Park. Seasonal flowing streams. Year round road maintenance.
  • RURAL ACREAGE OUTSIDE SILVER CITY, NM
    Country living just minutes from town! 20 acres with great views makes a perfect spot for your custom home. Nice oaks and juniper. Cassie Carver,...