Herald-Leader Editorial

E. Ky. coal costs too high for revival

July 23, 2014 

Anytime you read or hear anything about coal, insert a mental asterisk for Eastern Kentucky.

Whether it's a political ad — aren't you sick of them already? — or a headline like "UK emissions pilot project could keep Ky. coal relevant," remember this: The overriding consideration for coal mined in Eastern Kentucky is price.

The high cost of production in Central Appalachia, which also includes West Virginia, rules out a big rebound in the coal industry, no matter who is in power in Washington and even if scientists figure out how to burn coal without compromising the climate or environment.

The 2014 edition of Kentucky Coal Facts reports the following prices for coal delivered to utilities in 2013, in cost per million BTU, a measure of power for producing steam to generate electricity:

■ Eastern Kentucky, $3.62

■ West Virginia, $3.23

■ Pennsylvania, $2.68

■ Illinois, $2.49

■ Western Kentucky, $2.40

■ Wyoming, $2.03.

When buying a commodity by the trainload, you go with the lowest price. No Ph.d in economics is needed to understand what those numbers mean for the future.

What's hard to understand is why Kentucky's elected and business leaders failed to prepare for what they should have seen coming.

As Coal Facts, published by the state in cooperation with the Kentucky Coal Association, explains: "Since the year 2000 ... diminishing reserves of thick and easily accessible coal seams in Eastern Kentucky have made coal more difficult, labor intensive, and costly to mine, which has resulted in reductions in price competitiveness vis-a-vis coal from other regions and alternative sources of energy.

"Kentucky coal has been under increased competition from cheaper Powder River (Wyo.) Basin coal since the 1980s and from natural gas produced through advances in hydraulic fracturing technology since the 2010s."

What this means is that Kentucky must focus on creating a post-coal economy in the mountains.

Alltech's new plans for a bourbon distillery in Pikeville and aquaculture and poultry production at a reclaimed Pike County mine, with the state paying $13.7 million for an access road and bridge, are a hopeful step. So is the state's recent request for proposals for upgrading broadband capacity.

Across the region this summer, the bipartisan Shaping Our Appalachian Region initiative is holding listening sessions, as part of a process for developing an economic plan.

Meanwhile, as the Herald-Leader's Bill Estep reported, a $19.5 million joint venture by the U.S. Department of Energy, the University of Kentucky, Kentucky Utilities and state government is testing a technology that could make it cheaper to remove carbon dioxide from power plant emissions.

CO2 from power plants is the largest source of greenhouse gases building up in the atmosphere, disrupting climate and weather.

Developing a safe, cost-effective way to keep carbon emissions out of the atmosphere — a long shot, to be sure — would preserve coal's viability as a power-plant fuel.

But even if that happens, the coal won't be coming from Kentucky's mountains: A century of mining and the market have already decided that.

Politicians who try to convince you they can rescue coal jobs in Eastern Kentucky are producing their own harmful emissions.

Lexington Herald-Leader is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service