Old King Coal

Massey CEO’s jail sentence punctuates industry’s decline

The coal industry continues to take hits as the country transitions from fossil fuels to renewable energy. Most recently, a number of utilities plant closings in the Midwest mark the decline. Last week, Indianapolis Power & Light retired four units at its Eagle Valley Generating Station, with plans to replace the facility with a new 671 MW combined-cycle gas plant. In addition to this, the region said goodbye to three other utilities plants. Duke Energy Indiana, Consumers Energy, and Holland Board of Public Works in Michigan combined to total 2,000 MW of coal capacity retired. The Eagle Valley plant had been in operation for nearly 70 years. A bright spot is that several of these particular closings are designated to be replaced by gas operations.

The Consumers Energy closings included what is known as the “Classic Seven”, the company’s seven oldest coal-fired power plants. This is expected to result in lower power bills for its 1.8 million customers served in Michigan, amounting to a deduction of $38 million for the customers (Consumers Energy is Michigan’s largest utility, providing natural gas and electricity to 6.7 million of the state’s 10 million residents in all 68 Lower Peninsula counties).

The industry’s decline is equally apparent at the corporate level — with some severe consequences. On April 6,  Don Blankenship, former CEO of Massey Energy, the now-defunct Richmond, Va., energy provider, was sentenced to one year of jail time for his role in safety violations related to an explosion that killed 29 miners in a West Virginia facility six years ago.

Investment in renewable energy was double that of both coal and gas in 2015. A record amount of $286 billion was invested in renewables globally last year.

“In 2015, more than twice as much went into new capacity to generate electricity with renewables like solar and wind than into power stations burning fossil fuels,” according to a study by the Frankfurt School of Finance and Management for the UN Environment Programme.

Coal plants like this Consumers Energy facility in Michigan are being shut down or transitioned to accommodate alternative energy sources.

Coal plants like this Consumers Energy facility in Michigan are being shut down or transitioned to accommodate alternative energy sources.

“Renewables are becoming ever more central to our low-carbon lifestyles,” said UNEP director Achim Steiner, “Over the past decade, cheaper solar panels and wind turbines have cut the cost of renewable electricity – in some places by up to 80 per cent. Now, green energy is often no more expensive than fossil fuels. And it is no longer chiefly the preserve of developed countries either. Last year developing countries invested $156 billion in renewables, which for the first time exceeded the $130 billion investment made by high-income countries.”

As with any transition to something new, there is generational and philosophical resistance. Take the Montana town of Colstrip, where a majority of jobs and energy are still fueled by good old coal. The town values the factory (one of the top 20 in coal power production in the U.S.) because of its vitality to the community. The town brings in power from various sites in Washington state, Allentown, PA, Oregon, and Montana. About 770 of Colstrip’s 2,300 residents work at the power plant or the sprawling mine complex that feeds it.

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