‘King’ coal tarnished, still powerful

March 7, 2014
John Pippy, CEO of the Pennsylvania Coal Association, answers questions following his presentation Thursday evening to the Washington County Manufacturers Association and the Business Exchange Network at Hilton Garden Inn, Southpointe. - Michael Bradwell / Observer-Reporter Order a Print

Given U.S. coal’s recent struggles with growing environmental regulations, many Americans may not know the fuel continues to be “king” in a variety of ways.

That was the message John Pippy delivered Thursday during an hour-long presentation to about 65 members of the Washington County Manufacturers Association and the Business Exchange Network at the Hilton Garden Inn, Southpointe.

Pippy is chief executive officer of the Pennsylvania Coal Alliance, a trade organization that represents the interests of more than 300 member companies and 41,500 workers in Pennsylvania’s coal industry.

During a PowerPoint presentation, Pippy noted when measured in Btu, or units of measured heat, coal is the warmest, providing 19 percent, while natural gas provides 6 percent and oil, 3 percent.

Closer to home, in Pennsylvania, coal is one-third of the “Big 3” of fuels that include natural gas and nuclear, “which are critical elements to our energy independence,” Pippy said.

Bituminous coal also is a $7 billion driver in the state’s economy, responsible for 41,500 mine and mining-related jobs, he added.

That was evident by some of the representation in Thursday’s audience, which included management and other employees of Caterpillar and Joy Global (mining machines) and the Fairmont Supply division of Consol Energy.

According to state statistics Pippy shared, in Washington County, the coal industry provides 3,021 jobs that have an average annual income of $88,505, which is more than double the $43,660 average wage for all other occupations in the state.

And despite the recent closures of two coal-fired generators in Washington and Greene counties, coal still provides 34 percent of the baseload of energy to Pennsylvania’s electric grid, sandwiched between 38 percent from nuclear and 23 percent from natural gas.

With those statistics, Pippy said, it’s imperative for federal and state regulatory bodies to proceed at something less than a breakneck pace to try to eliminate coal from the “all-of-the-above” fuel choice strategy that contributes to keeping consumer and industrial fuel costs down here and elsewhere.

“(Regulatory) oversight is good, but overreach is bad,” said Pippy, who holds a degree in environmental engineering from West Point and spent 16 years in the Pennsylvania Legislature.

He told the audience that he isn’t opposed to more stringent environmental regulations for coal, as long as they’re phased in with enough time to allow the industry to come in line with them, in much the same way that the U.S. automobile industry has had to comply with incrementally higher fuel economy standards for its cars and trucks.

But with coal plant retirements growing as fast as they are – Pippy said recent retirements have removed more than 5,000 megawatts of capacity from the grid, with more than 330 coal plant closings scheduled in 33 states – it will be a long stretch to replace the roughly 11 percent capacity loss with other fuel sources.

At the current rate of closures, Pippy said consumers can expect to see electric costs escalate, noting that even with the current shale gas revolution, natural gas-fired plants won’t be able to come online fast enough to make up for the capacity deficit.

According to Pippy, clean-coal technology, coupled with progressive industry practices, would go a long way in helping the United States reduce its carbon footprint.

He pointed to the Longview coal-fired plant in West Virginia, built in 2009, which was measured to be 90 percent more efficient than the legacy plants that are being retired.

But even if regulations outpace the industry’s ability to keep up with domestic technological improvements, coal will continue to be king as an export fuel, Pippy said, thanks to growth of urban centers in emerging countries.

“By 2020, developing countries will account for 80 percent of the world’s total urban population,” he said.

“Exports will be the greatest portion of U.S. coal going forward.”

Michael Bradwell has been business editor for the Observer-Reporter since 1995, and was named editor of The Energy Report in 2012. He joined the newspaper in 1990 as a general assignment reporter in the Greene County bureau and has also worked as a copy editor. A 1974 graduate of Pennsylvania State University with a degree in English, he began his career at the Bedford (Pa.) Gazette. Prior to joining the O-R, he served as public relations director for Old Bedford Village, account executive at two Pittsburgh public relations agencies and copywriter for the country’s largest wholesaler of mutual funds.

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