What the Coal Boom Means for West Virginia Towns

June 17, 2008

Soaring prices for coal mean higher tax revenues for state and local government -- good news for small communities, as Bill Byrd of the Times West Virginian notes:

Open this summer after being closed for eight years, Fairmont’s 12th Street pool is a long way from India or China.

But demand for coal in the global energy market played a key role in helping the Marion County Commission pay to repair the pool, a local landmark since 1937.

Local and state governments are collecting much more in severance taxes during the current coal boom....

[T]he fact that the county commission was able to pump over $300,000 into repairing the pool is due to an eye-popping increase in the price per ton of coal.

The article goes on to give some details: the price of a ton of West Virginia coal has gone up from $30 to $55 in the past five years, and that price increase has meant the severance tax (a tax that some states levy on companies that exploit natural resources) on West Virginia mining firms has brought ever more money into state coffers, up from $214 million in 2003 to a projected $340 million this year.

posted by Stephanie Cohen | 4:31 pm
File As: Coal

... but in Kansas, proposed coal plants are nixed

May 5, 2008 • A veto by Kansas Gov. Kathleen Sebelius of two proposed 700-megawatt coal-burning coal-fired plants stands. According to news reports, members of the state House rebuffed the effort to override her veto of the power plants.

"The Kansas House voted 80-45, falling four votes short of the required two-thirds majority needed in the 125-member chamber to override the veto," according to the Lawrence Journal-World & News.

Speaker Melvin Neufeld, a Republican, reportedly kept the roll call open in the House for two hours and kept the chamber under lock-down (members could only leave with permission and had to return quickly) while proponents of the project tried to muster the needed votes -- to no avail.

But the two chambers of the state legislature were divided over the veto. On Wednesday of last week the state Senate overrode Sebelius’s veto 32-7, five votes more than the required two-thirds majority.

Apparently, the original rejection of the permit for a coal-fired power plant by the Kansas Department of Health and Environment marked the first time that any government agency in the United States cited carbon dioxide emissions and greenhouse gas concerns in rejecting such a permit.


Speaking at a Yale climate change event two weeks ago (I was in attendance), Governor Sebelius said she was opposed to the plants because much of the electricity they produced would be exported to other states (namely Colorado and Texas) while Kansas residents would be forced to live with the emissions pumped into the air and the effects of climate change.

Prior to the veto override vote, lawmakers approved a separate bill that would have increased the amount of energy from the project for Kansas residents from 200 megawatts to 400 megawatts.

According to the Energy Department, seven coal-fired power plants supply more than 75% of electricity to Kansas residents. Almost all of the coal used in Kansas’s power plants is shipped by railcar from other states -- mostly from Wyoming.

The Kansas supreme court decided in April to put on hold its review of the commission's decision blocking the power plants to allow legal challenges to be considered in district court and in administrative hearings involving the Kansas Department of Health and Environment, according to news reports.

posted by Stephanie Cohen | 3:41 pm
File As: Energy Policy, Coal

Indiana clean-coal plant price tag goes up...

May 2, 2008

Duke Energy filed a report with the Indiana Utility Regulatory Commission updating the agency on the expected cost of completing a clean coal gasification power plant currently under construction in southwest Indiana. The company upped the cost estimate of the plant by $365 million to $2.35 billion. This translates into a 2% rate impact for customers between 2008 and 2013. Duke president James Turner said the increase was similar to increases for other types of buildings. The plant is located in Edwardsport, Ind. and is expected to be completed in 2012. The 630-megawatt plant will use integrated gasification combined cycle technology. That total cost will be offset by about $460 million in local, state, and federal tax incentives.

posted by Stephanie Cohen | 12:53 pm
File As: Energy Technology, Coal