Mitch McConnell’s commitment to coal has hurt Eastern Kentucky residents

Mitch McConnell’s lifelong commitment to subsidizing the fossil fuel industry comes at a high cost, particularly in Eastern Kentucky. Conservative estimates indicate coal receives a $20 billion cocktail of direct subsidies and tax benefits while ”black-lung disease” gets no more than pity. The sick and dying coal miners are the short-term proof that something isn’t right.

Contrast that with the findings of the National Oceanic Atmospheric Administration (NOAA) that the U.S. over the past three years has experienced weather-related disasters at a cost exceeding $150 billion per year. In the short-term, a draining expense and long-term a matter of survival. Top it all off that the U.S. pollutes more than twice the level per capita than China and the European Union, with close to 15 metric tons CO2 per capita.

Mitch will shoot his heavy artillery at any mentioning of a “green” movement or emission-free electric generation like wind and solar. But subsidizing an industry long-term with such a negative impact compares to a socialist-like model that funds what’s inefficient, outdated, and continue at all cost. Mitch pretends that coal generates jobs and secures low electricity rates. Let’s take a look at that:

Coal jobs in Kentucky dropped 27 percent from the first quarter of 2017 to the first quarter of 2020. The good news is that former miners can find employment in a growing renewable energy sector.

Kentucky Power (KP) generates electricity from coal and natural gas and distributes to some 20 counties in Eastern Kentucky. KP is one of four investor-owned electric utilities with the highest rates and the highest revenue per customer. Yet, they want to increase rates and tariffs again.

First, KP’s customer base is in decline, and KP lost $81 million in revenue over the past five years in electric sales to other utilities, cities, and out-of-state sales. That is a massive loss, and it reduced shareholder-return-on-equity to 6.7 percent when they want 10 percent. Therefore, KP wants to increase residential and commercial rates and tariffs to compensate for lost revenue.

Secondly, KP’s centralized electric generation comes from West Virginia and the Big River area. It runs in thousands of miles of high voltage powerlines to feed a declining number of customers in 20 counties in Eastern Kentucky. According to KP, the cost of maintaining over 10,000 miles of power lines in an unstable mountainous region laden with trees comes at a high cost that keeps increasing due to climate change. The cost to maintain powerlines is around $125 million a year.

Thirdly, Eastern Kentucky, a low-income region, already has the highest rates. A majority of KP’s customers here qualify for the federal “Low-Income Home Energy Assistance Program” (LIHEAP) benefits. Data obtained from 9 of the 20 counties shows that in 2018 total benefits were $4.5 million and included close to 12,000 households. Most of these benefits went to pay electricity bills. Due to KP’s high rates and inefficiencies, taxpayers are also subsidizing KP’s shareholders.

Mitch insists that all must follow American values and capitalism through the use of technology and innovation. Subsidizing fossil fuels and large ineffective corporations like KP is the very opposite. Eastern Kentucky is the perfect place to apply technology and an innovative approach like distributed generation and combines rooftop solar, community solar, and utility-scale solar facilities with storage.

What happened to the investment opportunity the coal industry had? The profits went to out-of-state corporations. Some of the coal severance taxes went to fund state-approved projects far away from Eastern Kentucky. Funds that are now less than $100 million a year.

As a result, Eastern KY is left behind in the 19th century, abused with poor infrastructure and health, and endures the highest electricity rates. If coal had ever invested a fraction of the sums made here, this region and its mountains would be truly golden today.

Kris O’Daniel is on the board of Kentucky Solar Energy Society (KYSES) and involved in the Kentucky Power Company’s rate case with the Public Service Commission.