Investment in coal infrastructure faces uncertain future
The long-term, global economic prospects for coal are drawing bleak financial reviews. Another question for regional coal-export terminals.
Times editorial columnist
The guy in the coal documentary on TV was adamant. If coal trains cause harm to the environment, then so do Boeing airplanes. Stop coal trains and the whole regional economy unwinds.
This logic brings to mind two words: cow flatulence.
Did the emergency PR committee convened to drum up ideas to promote coal trains consider cow flatulence?
Why not add the environmental damage done by methane discharges? Do opponents of coal trains really want to stop the dairy and beef industries in Washington?
Indeed all of agriculture is threatened if coal trains are not allowed. Yes, even the iconic cherry industry. Ba-da-Bing!
The fellow’s “what you’re really saying” challenge has all the earmarks of consultants dreaming up snappy rhetoric to push back any arguments. The billable assignment just got tougher with all the bad news about the global economic realities of coal.
Plans to ship millions of tons of Powder River Basin coal from proposed export terminals at Cherry Point in Whatcom County near Bellingham, and Longview in Southwest Washington, are gearing for administrative review.
Last Friday the Army Corps of Engineers and the state Department of Ecology announced they would conduct their own separate reviews. The feds will narrow their focus to immediate impacts around the terminal sites.
The state will look at how cities in Eastern Washington and along the Columbia River will be affected by coal-train traffic going and coming to Cherry Point and Longview. Environmental impacts of coal-fired plants in Asia will also be studied.
One new reality is the price of coal has tumbled, and the investment community has a glum outlook about prospects for improvement. China has been the sure bet, but its investment in and tolerance for burning coal is waning.
The economic downside of coal was prominently featured by local opponents of the coal terminals: Sightline Institute, Climate Solutions and Greenpeace. Of course, the dour reports featured in a recent news conference were not their making.
An Aug. 22 headline from The Associated Press reported a Powder River Basin lease auction received no bids for the first time in Wyoming history.
Coal has tumbled from $142 a ton to $83 per ton. Goldman Sachs, in its “Rocks & Ores” report, bluntly states the window for thermal-coal investment is closing.
Environmental regulations, competition from gas and renewable energy and improvements in energy efficiency are targeted. “In a way, 2013 represents a watershed for the global-coal market.” Another report topic notes, Chinese supply overtakes demand.
A June 2013 report by Bernstein Research describes the demise of coal in Asia. Coastal China is not willing to put up with the environmental consequences.
A May 2013 analysis by Deutsche Bank Markets Research paints an equally bleak picture for the future of coal in China.
Meanwhile, Washington is contemplating enormous export terminals with higher train volumes. Cities along the route face huge investments to live with the train traffic.
Seattle is looking at relocating a fire station and building an underpass. Edmonds is also worried about residential, ferry and emergency traffic to its waterfront. An underpass has also been discussed.
Local mayors, council members and tribal leaders from Spokane to Bainbridge Island have organized as the Leadership Alliance Against Coal.
Their taxpayers face potential investments of tens of millions of dollars to keep their communities functioning as the investment community wonders out loud about the future of coal.
I am all in favor of infrastructure investments and the jobs they to provide. Just build something with a value-added, economic shelf life. How about a new bridge between Washington and Oregon?
The only return on investment with coal, coal trains and coal terminals is carbon dioxide and ocean acidification.
Lance Dickie's column appears regularly on editorial pages of The Times. His email address is firstname.lastname@example.org