Alpha Natural Resources

By Staff - United Mine Workers of America, June 1, 2021

Clearly, the UMWA's positions on carbon capture and storage (CCS) and so-called "clean coal" stand in contrast (and, for the most part, opposition) with the entirety of the climate justice movement, ecosocialists, green syndicalists, and a good deal of rank-and-file union members not involved in resource extraction (including the more than 60-70% who support something like the Green New Deal). That said, at least the UMWA finally accepts that coal is a dying industry and a just transition is needed. Therefore, this is presented to show where the UMWA stands, not as an endorsement of their positions.

At the end of 2011, there were nearly 92,000 people working in the American coal industry, the most since 1997. Coal production in the United State topped a billion tons for the 21st consecutive year. Both thermal and metallurgical coal were selling at premium prices and companies were making large profits.

Then the bottom fell out. Over the next 4 years, coal prices cratered, especially in metallurgical coal but also in thermal coal. The global economy slowed, putting pressure on steelmaking and metallurgical coal production. Foreign competition from China, Australia, India and elsewhere cut into met coal production.

Domestically, hydraulic fracturing (fracking) of shale formations opened up previously untapped natural gas fields, caused the price of gas to drop below that of coal for the first time in years. Utilities began switching the fuel they used to generate electricity from coal to gas. Environmental regulations coming from the Obama administration also impacted coal employment. By 2016, just 51,800 people were working in the coal industry. 41,000 jobs had been lost.

Companies went bankrupt. Retirees’ hard-won retiree health care and pensions were threatened. Active miners saw their contracts, including provisions that had been negotiated over decades, thrown out by federal bankruptcy courts. From 2012 to today, more than 60 coal companies have filed for either Chapter 11 reorganization bankruptcy or Chapter 7 liquidation. Almost no company has been immune.

“Just since 2015 we have had companies like Peabody, Arch, Alpha Natural Resources, Walter Energy, Westmoreland and Murray Energy all go bankrupt,” President Roberts said. “Patriot Coal went bankrupt twice. Retirees’ health care was on the brink, but we were successful in preserving that in 2017. The 1974 Pension Fund was on the path to insolvency, but we were able to save that in 2019.

“Even though our contracts were thrown out by bankruptcy judges at company after company, we were successful in preserving union recognition, our members’ jobs and reasonable levels of pay and benefits at every company as they emerged from bankruptcy,” Roberts said. “But in no case has the contract that came out of bankruptcy been the same as the one our members enjoyed when a company went into bankruptcy. This has been extremely painful all the way around.”

By Kate French - Western Organization of Resource Councils (WORC), July 2020

The collapse of the coal industry is devastating small communities across the Western United States, but reclaiming these mined lands quickly could create up to 4,800 full-time equivalent jobs per year in the critical two to three year period after mine closure according to our new report, Coal Mine Cleanup Works. The report estimates potential reclamation job creation for four Western coal states (Colorado, Montana, North Dakota, and Wyoming) and provides recommendations for decision makers to ensure cleanup is fully funded and employs the local workforce. 

These findings offer a rare bright light of opportunity for coal communities that are facing massive lay-offs and lost revenue as the coal industry crumbles. Reclamation is one of the few immediately available job opportunities for local workers after a mine shuts down, and the report finds that these jobs are ideally suited for current or former miners.

Coal Mine Cleanup Works key findings include:

• Surface coal mine reclamation could create up to 4,800 full-time equivalent jobs per year in the critical two to three year period after mine closure. These potential yearly jobs represent up to 65% of the current surface mining workforce in the four-state region. 
• Reclamation is one of the few immediately available job opportunities for local workers after a mine shut down, and the report finds that these jobs are ideally suited for current or former miners.
• An important component of a just economic transition is having some immediate job creation solutions, like cleanup jobs, paired with longer-term job solutions.
• Delayed and underfunded reclamation are the biggest hurdles to getting laid-off miners back on the job doing cleanup work.

Read the text (PDF).

By Trevor Houser, Jason Bordoff, and Peter Marsters - Columbia Center on Global Energy Policy, School of International and Public Affairs, and the Rhodium Group, April 2017

From the introduction: Six years ago, the US coal industry was thriving, with demand recovering from the Great Recession, and global coal prices at record highs along with the stock prices of US coal companies. By the end of 2015, however, the industry had collapsed, with three of the four largest US miners filing for bankruptcy along with many other smaller companies. While coal mining employment has been on the decline for decades – from a peak of more than 800,000 in the 1920s to 130,000 in 2011 – the pace of job loss over the past six years has been particularly dramatic. After campaigning on a promise to end what he called his predecessor’s “War on Coal,” President Donald Trump signed an Executive Order in March 2017 ordering agencies to review or rescind a raft of Obama-era environmental regulations, telling coal miners they would be “going back to work.”

This paper offers an empirical diagnosis of what caused the coal collapse, and then examines the prospects for a recovery of US coal production and employment by modeling the impact of President Trump’s executive order and assessing the global coal market outlook. In short, the paper finds:

• US electricity demand contracted in the wake of the Great Recession, and has yet to recover due to energy efficiency improvements in buildings, lighting and appliances. A surge in US natural gas production due to the shale revolution has driven down prices and made coal increasingly uncompetitive in US electricity markets. Coal has also faced growing competition from renewable energy, with solar costs falling 85 percent between 2008 and 2016 and wind costs falling 36 percent.
• Increased competition from cheap natural gas is responsible for 49 percent of the decline in domestic US coal consumption. Lower-than-expected demand is responsible for 26 percent, and the growth in renewable energy is responsible for 18 percent. Environmental regulations have played a role in the switch from coal to natural gas and renewables in US electricity supply by accelerating coal plant retirements, but were a significantly smaller factor than recent natural gas and renewable energy cost reductions.
• Changes in the global coal market have played a far greater role in the collapse of the US coal industry than is generally understood. A slow-down in Chinese coal demand, especially for metallurgical coal, depressed coal prices around the world and reduced the market for US exports. More than half of the decline in US coal company revenue between 2011 and 2015 was due to international factors.
• Implementing all the actions in President Trump’s executive order to roll back Obama-era environmental regulations could stem the recent decline in US coal consumption, but only if natural gas prices increase going forward. If natural gas prices remain at or near current levels or renewable costs fall more quickly than expected, US coal consumption will continue its decline despite Trump’s aggressive rollback of Obama-era regulations.
• While global coal markets have recovered slightly over the past few months due to supply restrictions in China and flooding in Australia, we expect this rally to be short-lived. Slower economic growth and structural adjustment in China will continue to put downward pressure on global coal prices and limit the market opportunities for US exports. Indian coal demand will likely grow in the years ahead, but not enough to make up for the slow-down in China. The same is true for other emerging economies, many of whom are negatively impacted by decelerating Chinese commodities demand themselves.
• Under the best case scenario for US coal producers, our modeling projects a modest recovery to 2013 levels of just under 1 billion tons a year. Under the worst case scenario, output falls to 600 million tons a year. A plausible range of US coal mining employment in these scenarios ranges from 70,000 to 90,000 in 2020, and 64,000 to 94,000 in 2025 and 2030 -- lower than anything the US experienced before 2015.

These findings indicate that President Trump’s efforts to roll back environmental regulations will not materially improve economic conditions in America’s coal communities. As such, the paper concludes with recommendations for steps that the federal government can take to safeguard the pension and health security of current and retired miners and dependents and support economic diversification. Attracting new sources of economic activity and job creation will not be easy, and even at its most successful will not return coal country to peak levels of past prosperity.

But responsible policymakers should be honest about what’s going on in the US coal sector—including the causes of coal’s decline and unlikeliness of its resurgence—rather than offer false hope that the glory days can be revived. And then support those in America’s coal communities working hard to build a new economic future.

Read the text (PDF).

By staff - Public Citizen, May 2016

Over the past year, three of the United States’ major coal companies filed for bankruptcy: Alpha Natural Resources in August 2015; Arch Coal in January 2016; and Peabody Energy in April 2016.3 Although these companies and their trade association allies have often blamed environmental regulations for their precarious financial state, the truth is that debt-fueled acquisitions hobbled their finances at a time when market conditions were rapidly souring. Namely, Alpha Natural Resources, Peabody Energy, and Arch Coal bet big on future Chinese coal demand growth in 2011, going into debt to finance major expansions into metallurgical coal production during the year it was at peak price, only to see markets decline soon after the transactions were complete. At the same time, top executives were awarded record financial compensation, while slashing employee benefits and laying off workers.

Read the report (PDF).