It’s the coal industry.
Last month, the Department of Labor said coal added 6,000 workers nationwide over the past year, a 7.6% increase. In Illinois, 5,000 coal jobs pay an annual average of about $90,000 against the state’s all-industry average of $56,000. What is surprising about this achievement is that it comes from an industry that has not been favored by this administration, its regulators or its energy subsidies. But the president, seemingly unaware of coal’s enviable positive record, reiterated his support for costly regulations targeting coal-based power plants.
That’s a pity, because his own state offers a peek at the future of clean coal in the United States. The potential for coal-based plants to create good jobs is obvious from projects like Prairie State in southern Illinois, the largest coal plant in the U.S. Prairie State employed about 4,000 people throughout its multi-year construction phase and injected $4 billion into the state’s economy. Coal miners will be supplying fuel to that plant for many years to come. Prairie State will also be among the cleanest when it begins operations later this year thanks to its advanced coal technology and emissions control systems.
Why is coal creating jobs in Illinois when most industries are losing them? First, despite conventional wisdom, coal-based capacity is growing, not shrinking. Last year, coal-based power racked up its largest capacity additions since 1985.
Second, the world’s growing hunger for energy is sharpening its appetite for U.S. coal. China, the world’s second largest economy, is lighting up scores of giant new cities with coal—and builds them with steel made with American coal. Coal now generates 65% of India’s electricity. The country’s fast-rising middle class is driving plans to double the size of its power grid by 2025.
In fact, the U.S. Department of Energy forecasts coal will remain the dominate fuel source for electricity generation through 2035—both in the U.S. as well as the rest of the world. No wonder U.S. coal exports may total 100 million tons this year. That would be the highest volume in 20 years.
But this favorable outlook leads to a dilemma. How does a coal-rich nation like ours capture these opportunities with public policies that oppose coal production and use? History offers few clues because governments don’t usually thwart development of their own resources.
This government shouldn’t either if it cares about household utility bills and the unemployment rate. The president’s administration would be much better served by working with coal in states like Illinois, not against it.
Start by fostering a more positive, less adversarial regulatory environment. We can and should continue to make environmental progress, but accomplish this in ways that sustain a robust coal industry. One way is for regulators to examine the cumulative costs of multiple regulations on coal-based generation and grid reliability before implementing them.
The penalty for ignoring the true cost of regulations is borne by everyone. If pending air quality regulations shut down a fifth of Illinois’ coal based capacity as feared, state authorities in the president’s home state have warned that utility bills there could jump by 65% in five years.
Another pathway to job creation is to place more trust in states like Illinois to manage their own environmental affairs, especially in areas where Congress specifically intended. State environmental agencies are better able to balance environmental with economic interests than distant federal agencies.
Finally, in its push for renewable fuel technology, the administration should not neglect advanced coal technologies like those being pioneered in the president’s own state. Plants like Prairie State and the FutureGen 2.0 facility in Morgan County, Ill., show how state and federal governments can collaborate with industry to create clean energy projects and clean coal jobs.
Illinois says, “We can do this.” But is Washington listening?