Center for American Progress

The Obama Administration’s Enthusiasm for Coal Sales Undermines Its Climate Program

The Obama Administration’s Enthusiasm for Coal Sales Undermines Its Climate Program

The administration’s desire to sell coal leases undermines its promise to fight carbon pollution.

A house-sized dump truck at the Black Thunder coal mine in the Powder River Basin near Wright, Wyoming, on March 26, 2013. (AP/Mead Gruver)
A house-sized dump truck at the Black Thunder coal mine in the Powder River Basin near Wright, Wyoming, on March 26, 2013. (AP/Mead Gruver)

When it comes to the Obama administration’s Climate Action Plan, there’s a big carbon-breathing elephant in the room. Even as the White House moves aggressively to attack climate change through higher vehicle mileage standards; limits on coal-fired power plant emissions; and, most recently, a promise to attack fugitive methane emissions, it is paving the way for large amounts of carbon pollution through huge sales of federal coal from public lands in the West.

To date, the administration has sold half a dozen leases for about 2.1 billion metric tons of coal from the Powder River Basin in Wyoming and Montana, which produces more than 40 percent of U.S. coal—most of which is publicly owned. When burned for electricity, that 2.1 billion metric tons will produce nearly 6.1 billion metric tons of CO2, nearly equivalent to three years worth of CO2 emissions from all U.S. coal-fired electric plants.

The administration is also setting the stage for far larger coal lease sales from public lands in the coming years. Coal lease sales totaling about 3.15 billion metric tons are pending, according to the Bureau of Land Management, or BLM, the Department of Interior agency that oversees mineral development on public lands.

Furthermore, the BLM is nearly finished revising two so-called resource management plans, or RMPs, for the Powder River Basin. One covers the area managed by the Buffalo, Wyoming, field office and the other the area managed by the Miles City, Montana, field office. These plans govern how the BLM will manage many different resources, including coal, over the next 20 years and cover a region that encompasses some 20 million acres. When completed later this year, the Buffalo RMP will authorize the sale and production of another 10.2 billion short tons of publicly owned coal. The Miles City RMP does not specify an amount of coal that will be sold to industry.

Shannon Anderson, an organizer with the Powder River Basin Resource Council, a Sheridan-based grassroots organization of ranchers and other Wyoming residents that works on natural resource and agricultural issues, succinctly summed up the conflict between the administration’s climate and coal leasing programs: “There is a real disconnect.” Anderson, who with other regional activists and national environmental groups held a lobbying blitz a few months ago in Washington to push for coal leasing program reforms, said the group had little luck when meeting with administration officials. “It seems like any time the administration talks about it, it’s about ‘all of the above,’ that coal is … something they want to pursue,” Anderson said. “That 20-year time frame is the time frame we have to get a handle on climate change.”

Critics of the public coal leasing program have also pushed for a time out on lease sales, until reforms are implemented, for the BLM to account for the full social cost of carbon emissions when evaluating potential sales, and for an overhaul of how the BLM determines the value of coal tracts it is selling so the agency fulfills its statutory requirement to receive fair market value for those resources. Due primarily to the extraction of coal, oil, and natural gas—as well as their combustion—public lands are “contributing nearly 4.5 times more carbon to the atmosphere than they are currently able to absorb,” according to a recent Center for American Progress report.

A spate of investigations by the Government Accountability Office, the Department of the Interior’s Office of Inspector General, and an outside expert have found that taxpayers have been shortchanged millions, even billions, of dollars because of poor BLM management and oversight. The Interior Department is conducting another probe into whether coal companies have avoided paying higher royalties by using accounting gimmicks in which they buy federal coal cheaply and then sell it to sister companies that export it overseas at much higher prices than they paid.

With coal use on the decline in the United States due to pressure from cheap natural gas, environmental regulations, and the rise in renewable electricity sources, the industry has in recent years aggressively sought to revive its fortunes by increasing exports, which last year totaled nearly 118 million short tons. Major coal companies have pushed to build coal export facilities on the West Coast to facilitate exports to Asia, though half of those prospective projects have fallen by the wayside amid a decline in seaborne thermal coal prices and intense public opposition in the Great Plains and Pacific Northwest.

Ultimately, those market pressures may do what the Obama administration has so far shown little interest in doing: put the brakes on public land coal sales that would result in massive amounts of carbon pollution in the coming years. In the meantime, however, the administration needs to remember that its coal sales contribute to the very environmental effects it wants to prevent.

Tom Kenworthy is a Senior Fellow at the Center for American Progress.

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Tom Kenworthy

Senior Fellow