Pausing The Coal Train

— by CAP Action War Room

The Obama Administration Announces Overhaul Of Federal Coal Leasing Program

The last time rules for coal mining on tax-payer public lands were updated, smoking was allowed on airplanes, airbags weren’t required in cars, and sewage was still dumped into the ocean. But today, the Obama administration announced a package of reforms to modernize and reform the federal coal leasing program. Interior Secretary Sally Jewell announced the plan, saying it was long past time to re-examine the coal-leasing program. “It is abundantly clear that times are different in the energy sector now than they were 30 years ago, and we must undertake a review and that’s what we need to do as responsible stewards of the nation’s assets,” she said.

The plan includes three measures to update the federal coal program to account for taxpayer interests and environmental challenges: The U.S. Department of the Interior will conduct a review to identify potential reforms to the program, direct the U.S. Geological Survey to begin annual tracking and reporting on greenhouse gas emissions that come from fossil fuel extraction on public lands, and put a temporary pause on new coal leasing, which will not apply to existing leases.

Coal companies currently have stockpiled billions of tons of unmined coal that is ready to be developed, so a targeted pause on leasing will likely have no impact on jobs, coal production, energy prices, or grid reliability. But it will keep at least 3.5 billion tons of coal from being added to the already-enormous stockpile coal companies have on public lands and allow time to figure out how to best change the current program to ensure taxpayers get their fair share from coal mined on public lands.

The current federal coal-leasing program is fundamentally noncompetitive. Under the current system, taxpayers are missing out on millions of dollars in royalties from leasing energy sources on public lands. Offshore oil and gas drilling is subject to an 18.5 percent royalty charge, but coal companies only pay a 12.5 percent royalty rate for mining on federal lands. Furthermore, royalty rate reductions, loopholes, subsidies, and self-dealing transactions further reduce the effective royalty rate coal companies pay to less than 5 percent. Because the current system fails to ensure mining companies pay royalties on the true market price of the coal they extract, coal companies are able to take advantage of billions of dollars of de facto subsidies.

A flawed royalty system is not the only way the true cost of coal is being undervalued. The environmental impacts of coal, including its contribution to climate change, also impose a cost to the American public. More than 57 percent of all emissions from fossil fuel production on federal lands comes from the combustion of coal. Coal mining in the Powder River Basin alone, which spans across Wyoming and Montana, is responsible for 10 percent of all greenhouse gas emissions in the U.S.

Strip mining and failed mine reclamation produce air and water pollution, which add to coal’s environmental costs. Furthermore, some companies are trying to get out of their responsibility to clean up their mines on public lands, which could leave taxpayers holding the bag for billions of dollars in reclamation costs.

BOTTOM LINE: Not much has stayed the same since the 1980s and the energy sector is no exception. Reform of the federal coal program is long overdue. The Obama Administration’s steps to modernize and reform the program will help reduce the environmental and climate impacts, ensure that taxpayers are getting a fair return, increase transparency and accountability, and hold companies responsible for cleaning up their mining operations.


The article above was created by the Center for American Progress Action Fund. It was created for the Progress Report, the daily e-mail publication of the Center for American Progress Action Fund. Click here to subscribe. ‘Like’ CAP Action on Facebook and ‘follow’ us on Twitter

Reject the Confirmation of Moniz for DOE

Please reject President Obama’s nomination of “fracking” proponent Dr. Ernest Moniz to serve as the next head of the Department of Energy.

“Fracking” is a highly polluting form of oil and gas extraction that requires blasting huge volumes of water mixed with toxic chemicals and sand…

If you think blasting toxic chemicals into the same ground that gives us the food we eat and the water we drink, is dangerous, if you think allowing fracking to destroy our farmland, contaminate our groundwater and endanger our health sounds like a bad idea, you’re part of a growing movement that is determined to ban fracking across the U.S. and move the country toward a sustainable future of clean energy and organic food and farming.

President Obama has nominated ardent “fracking” supporter Dr. Ernest Moniz as the next head of the U.S. Department of Energy (DOE).  Moniz is the director of MIT’s Energy Institute, which boasts such Big Oil financial backers as BP, Chevron and Saudi Aramco.

Please sign our petition. Tell the Senate: Reject Moniz!

Fracking is a highly polluting form of oil and gas extraction that requires blasting huge volumes of water, mixed with toxic chemicals and sand, deep into the earth to break up rock formations. There are more than 600,000 fracking wells and waste injection sites littering the United States.

Contaminated crops and farm animals raised for food subsequently serve as possible avenues for exposing humans to these same hazardous chemicals, including arsenic, benzene, ethylene glycol (antifreeze), formaldehyde, lead, toluene, Uranium-238 and Radium-226. The American Academy of Pediatrics’ list of common health problems from exposure to these fracking chemicals includes autism, asthma, cancer, heart disease, kidney failure, infertility, birth defects, allergies, endocrine diseases and immune system disorders.

recent study that involved interviews with animal owners who live near gas drilling operations revealed frequent deaths. Animals that survived exhibited health problems including infertility, birth defects and worsening reproductive health in successive breeding seasons. Some animals developed unusual neurological conditions, anorexia, and liver or kidney disease.

Increasing numbers of farmers on the front lines of the fracking fight have fallen ill, too:

  • Carol French, a Pennsylvania dairy farmer is surrounded by nine gas wells. Two weeks after she noticed her water had changed her daughter developed a fever and diarrhea that turned to blood. She lost ten pounds in seven days.
  • Steve and Jacki Schilke, two North Dakota ranchers, are surrounded by 32 oil and gas wells within three miles of their 160-acre ranch. Jacki blames the wells for the loss of two dogs, five cows and a number of chickens, as well as the decline of her own health. Her symptoms began a few days after the wells were fracked, when a burning feeling in her lungs sent her to the emergency room.
  • Christine Moore, an Ohio horse rescuer, had a well fracked five miles from her house. Within two months her water went bad. An oily film formed across the surface of the water in her horses’ bowls. The water inside her home, pumped from her well and filtered through a softener, began giving her severe stomachaches.

Stories like these are no longer isolated incidences but increasingly common place. President Obama needs to hear from you: Expanding fracking operations won’t serve as a bridge to a cleaner future. Instead, it will sound the death knell for sustainable farming, healthy food, clean water, and a stable climate.

Mining Gold, Undermining Democracy

Neither foreign investors nor unelected tribunals deserve the power to trump democratically elected leaders.

By Robin Broad and John Cavanagh

John CavanaghRobin BroadA tribunal in Washington, D.C. that nobody elected recently issued a verdict that potentially hinders the democratic rights of millions of people. Its three members ruled that a foreign company may continue to sue El Salvador for not letting the company mine gold there. The impoverished Central American country could potentially be forced to pay a Canadian mining company called Pacific Rim $77 million or more in damages. This anti-democratic ruling has ominous implications for all of us.

We visited El Salvador last year to learn more about this landmark case. A wide vein of gold lies alongside the northern portions of a large river that flows down the country’s middle. This river provides water for more than half its population. The gold remained relatively undisturbed until about a decade ago, when foreign companies began to apply for mining permits.

Farmers and others told us that they were initially open to gold mining, thinking it would bring jobs to ease the area’s deep poverty. But as they learned more about the toxic chemicals used to separate gold from the surrounding ore and about the massive amounts of water used in the process, they began to organize a movement that opposed mining. Their simple cry: “We can live without gold, but we can’t live without water.”

By 2007, polls showed that close to two-thirds of Salvadorans opposed gold mining. In 2009, Salvadorans elected a president who promised he wouldn’t issue any new mining permits during his five-year term. He has kept this pledge.

But Pacific Rim didn’t sit idly by as democracy worked its way from El Salvador’s northern communities to its national government. The company sought a mining license. When the government didn’t approve its environmental impact assessment, the Canadian company resorted to lobbying Salvadoran officials. And, when its lobbying failed, Pacific Rim lodged a complaint against El Salvador at the International Center for the Settlement of Investment Disputes in Washington under a U.S.-initiated trade agreement and a little-known investment law in El Salvador.

Laws and trade agreements like these grant corporations the right to sue governments over actions — including health, safety, and environmental regulations — that reduce the value of the corporation’s investment.

To the surprise of many observers, the tribunal ruled on June 1 that Pacific Rim can proceed with the lawsuit against El Salvador. Even if the cash-strapped Salvadoran government wins in the end, it will likely have to shell out millions on legal fees to defend an action taken after lengthy democratic deliberations. If it loses in the tribunal’s next ruling, it will cost even more.

Laws and trade agreements that allow corporations to sue governments should worry us all. No international tribunal should have the right to punish countries for laws or measures approved through a democratic process, be it in the United States, El Salvador, or anywhere else. President Barack Obama said this himself in 2008 when he promised to limit the ability of corporations to use trade agreements to sue over public-interest regulations.

Alison McKellar/Flickr

Yet the Obama administration is currently negotiating a Trans-Pacific Partnership with several countries. And it’s pushing for provisions that would allow companies to sue governments under this trade pact. But an expanding coalition of labor, environmental, religious, and other groups opposes giving Big Business this privilege. A similar coalition in Australia, another country negotiating this trade deal, has convinced its government to oppose such corporate “rights.” The Trans-Pacific Partnership may well prove an opportunity for this outrageous assault on democracy to be defeated.

Democracy belongs to the people. Those of us standing up to defend democracy and counter corporate abuse should strongly oppose any new “rights” for corporations being written into new trade pacts as we try to overturn the existing ones.

El Salvador’s government has the right to act upon the will of its people — and should be expected to do so. Neither foreign investors nor unelected tribunals deserve the power to trump democratically elected leaders.


Distributed via OtherWords (OtherWords.org)


Robin Broad is a professor at American University’s School of International Service, and John Cavanagh directs the Institute for Policy Studies. www.ips-dc.org