By Luke Popovich

National Mining Association

In Washington, as in the real world, there’s often a frustrating disparity between expectation and reality. But this could change — with the incoming administration and new 115th Congress proving capable of undoing major regulations that have hamstrung America’s coal industry. And that could have an outsized impact on Indiana, a state that relies on coal for 78 percent of its power generation.

Early signs suggest that House and Senate leaders — with the Trump administration’s blessing — intend to honor their pledges to overturn some Obama-era rules that offer little economic benefit but have yielded costly job losses. House Majority Leader Kevin McCarthy echoed remarks made recently by Speaker Paul Ryan that President Obama’s last-minute “stream rule” would be among the early targets of opportunity.

This is both smart politics and smart policy. While the climate class is worried about fulfilling President Obama’s commitments to the Paris treaty, a January poll by Morning Consult found that America’s working class named job creation as their top concern. So one way to win over Trump voters might be to put their interests ahead of the UN’s.

Blunting regulations that have crippled the coal industry is not only a great way to say “we hear you,” however. It’s also a policy for broadening U.S. energy diversity, and making it truly “inclusive.”

Luckily, President Obama has left deregulation advocates with a target-rich environment. Among the record-breaking 560 major regulations (costing $100 million or more each) issued by his administration through early 2016 are several that, if overturned, could unlock coal employment and rebuild energy diversity.

The new president can quickly show how elections have consequences by voiding the Obama-imposed moratorium on new coal lease sales. With the stroke of a pen, a President Trump could spare hundreds of high-wage jobs in Wyoming and Montana.

Stopping the 1,600-plus-page stream rule could save upwards of 42,000 direct jobs and many thousands more that are currently at risk throughout the supply chain. The stream rule — a careless grab bag of duplicative measures offering no discernible environmental protection — exemplifies all that is wrong with regulatory overreach. Simply put, it begs for a resolution of disapproval under the 1996 Congressional Review Act. A vote on such a resolution could come by late February.

Then there’s the Environmental Protection Agency’s Clean Power Plan (CPP). Currently idling in legal limbo in federal court, the CPP poses a more intractable rule. Still, if the court doesn’t strike it down, the new administration could water it down.

There’s fresh evidence of the damage that the CPP could wreak thanks to the U.S. Energy Information Administration’s 2017 Annual Energy Outlook. The EIA refutes the Obama administration’s doomsday prediction for coal, and instead finds solid potential for robust coal production — provided the CPP can be halted. That’s because the CPP holds down coal production to 619 million short tons by 2040; without the rule, says EIA, coal production rises to 861 tons, a 39% increase. “If indeed the CPP goes away, a lot of the economics people were using to retire coal units changes quite a bit,” explains Tom Hewson Jr., of consultancy Energy Ventures Analysis.

In Washington, heavy-handed regulators sometimes forget that capacity destruction also means job destruction. For example, it’s estimated that the 242 million tons of coal currently set for elimination under the CPP could support 27,700 jobs paying upwards of $85,000 annually, with good benefits. Almost 100,000 indirect jobs could also be spared.

Such an estimate will disappoint coal’s detractors. But it should encourage the new Congress and administration to lift the regulatory boot from coal’s neck. In today’s political climate, there’s more value in defending 127,700 good jobs than in creating job-killing regulations.

 

Luke Popovich is vice president for external relations at the National Mining Association (NMA). 

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