Coal news and updates

In an Oct. 10 opinion (“Coal exports bad for Montana’s health, economy”), Missoula activist Kate Keller poses the question of whether Montana’s coal industry is worthwhile for our state. Her conclusion is that we’d be better off without coal, and though we have to appreciate her passion on the issue, it’s clear her economic analysis is seriously flawed.

 

Montana is lucky to have the largest coal reserves in the country, valued at $1.5 trillion. Those massive reserves have allowed our state to build an economic infrastructure that touches every county in the state. Tens of thousands jobs are connected to the coal produced and consumed in Montana. The electricity produced in Montana by coal is among the cheapest in the nation, giving all Montana businesses a break on their utility bills.

 

And the coal industry has provided Montana a billion-dollar trust fund that helps fund education in every school district in the state, law enforcement in every county, and provide for important infrastructure improvements in every corner of the state. Eliminating Montana’s coal industry would mean having to replace billions of dollars of tax revenue for state and local governments.

 

I spent 10 years in the Montana legislature serving on the taxation committee, and I know firsthand how important Montana’s coal industry is to our tax base throughout the state, and the tremendous impact we could see from new revenue from expanded production. In my current role as a public service commissioner, I’m charged with protecting Montana consumers and making sure they have access to the lowest-cost energy available, and I know how critical coal is to our energy mix.

 

Economics is about tradeoffs. We could choose to leave that coal in the ground, but to make that choice we have to consider what the benefits would be. Stopping coal mining in Montana wouldn’t have any impact on climate change because the growing demand for coal in Europe and Asia would be met from some other supplier – trust me, plenty of other countries would love to see Montana stop competing for the business.

 

Keller’s opinion also suggests that transporting coal poses health threats. The Missoula City-County Health Department has already conducted a study on “coal dust” near the railroad through Missoula, finding scant evidence of coal particles and concluded there was no public health concern related to coal transportation. Frankly, the “coal dust” argument we see again and again is a red herring that doesn’t belong in an honest debate about this issue.

 

So it seems that there really wouldn’t be any benefits to stopping coal mining or coal exports. But what about negative tradeoffs?

 

For starters, we know that prohibiting a project like Otter Creek would result in preventing thousands of new, high-wage jobs from being created, slow the state’s economic growth to the tune of $200 million per year, and prevent about $100 million in annual tax revenue.

 

Since coal makes up more than half of Montana’s electricity base, taking the radical step of eliminating it from our power base would result in incalculably higher utility bills. That would result, in turn, of severely slowing economic growth in our state and would be a huge economic blow to every business and consumer in the state.

 

It’s clear that in weighing the costs and benefits of what Keller is suggesting, there really isn’t much room for debate. Increasing Montana’s coal production is perhaps the single biggest economic opportunity that our state has before it. Not only would we be foolish to say no to that opportunity, but each and every one of us would pay the price for it in our own pocketbooks through higher utility rates, higher taxes, and slower economic growth.

 

Montana’s coal companies are great neighbors, and they deserve better than the treatment offered in Keller’s opinion. Collectively they pay hundreds of millions each year in taxes and they spend hundreds of millions more with Montana vendors and suppliers. They employ thousands of Montanans in good, career jobs with wage and benefit packages in the six-figure range. And they contribute millions more to Montana charitable causes.

 

The contributions they make to our state economy benefit every community in Montana. Please join me in saying thank you.

 

Bob Lake is the vice chairman of the Montana Public Service Commission. He lives in Hamilton.

 

Source: missoulian.com