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How the Crusade Against the Coal Industry Could Stop Environmental Progress in America: Rethinking Environmentalist Strategies in Trump’s America

How the Crusade Against the Coal Industry Could Stop Environmental Progress in America: Rethinking Environmentalist Strategies in Trump’s America

Introduction  

     According to the National Research Council, in order to stave off the worst effects of climate change, the United States has until the year 2050 to cut its total carbon emissions by 90 percent from current levels. Twenty years ago, when the country was run on an electric power sector dominated by the emissions-heavy coal industry, this goal would have been unreachable. Now, with the coal sector firmly in a state of decline, circumstances appear to be shifting. Among environmentalists and proponents of renewable energy, there exists a misguided notion that the hastier the fall of coal, the better-off prospects for sustainable energy will be. However, in light of the natural gas industry’s current technological and economic advantages over the wind, solar, and hydroelectric industries, can the strategically-minded renewable energy advocate really make this claim?

Present NRC estimates project that, as a result of the coal and nuclear industries’ abatement, natural gas will eventually dominate the US electricity generation system, accounting for a whopping 56 percent of all domestic energy produced by the year 2050. Renewables, meanwhile, are slated to place a distant second, taking up only 24 percent of the nation’s energy generation scheme. Per unit of power generated, natural gas produces approximately half the carbon emissions of coal. However, natural gas’s still-high emissions level, combined with the fact that this fossil fuel is also expected to encroach upon the dwindling zero-carbon nuclear market, means that a projected shift from coal to natural gas will not do nearly enough to help America meet its vital target of a 90 percent emissions reduction in time to stop the runaway effects of climate change.

To stand even a chance of saving the environment, the United States must commit to a shift towards widespread dependence on renewable energy. As the failing coal industry cedes market space to its competitors, environmentalists and renewable-energy sector lobbyists must understand that their real fight ahead lies with natural gas.

The Fall of Coal: Opportunity in Inevitability

Until the dawn of the 21st century, coal dominated American energy production. From the passage of the first federal land ordinances in the late 18th century, the strength of the coal industry shaped the distribution of American economic and public lands, and the industry was hailed for creating jobs and promoting US energy independence.  At its peak output in 1988, coal-generated energy accounted for almost 58 percent of all energy production in the United States.

Art Credit: Peyton Ayers

Art Credit: Peyton Ayers

     Natural gas has always competed with coal for dominion over the American energy market. Advocates for coal have painted their industry’s recent troubles as the fault of overly-harsh government regulation. In reality, though, naturally-borne competition has spurred the market’s shift away from coal; technological advancements over the past fifteen years have assured gas’s ultimate victory over its rival. Breakthrough techniques in horizontal and deep-water drilling have allowed the natural gas industry to extract resources that were previously un-extractable, while simultaneous advances in oil-locating technology have caused the number of proven crude oil reserves in the United States to skyrocket. The price of oil is at a near-record low as compared to coal, but coal, beleaguered by outdated machinery and reputational concerns, is slated for a rough decline. In 2014, US coal consumption stood at one billion short tons per year--just two years later, it had shrunk to 677 million short tons and was falling rapidly.

Donald Trump’s love affair with coal has been well-documented. Throughout his presidential campaign, Trump consistently reaffirmed his commitment to “save the coal industry.” Since assuming office, the president has done his best to make good on this promise, signing executive orders to roll back Obama-era environmental policies and stacking his administration with lobbyists and politicians sympathetic to the plight of coal. Nevertheless, despite Trump’s best efforts, the fate of the coal industry remains firmly in a state of decline.

Renewable Energy in the United States: A Story of Progress and Pauses

Per the US Energy Information Administration, in 2016 renewable energy sources accounted for nearly 15 percent of all electricity generated in America. Renewable energy is environmentally friendly, politically popular, and has had increasing success at besting natural gas on a price-per-kilowatt basis. Even in states that voted overwhelmingly for Trump, renewable energy has proved itself to be a viable and economically efficient option for power generation and job market growth. In Wyoming, for example, a boom in the local wind energy industry has coincided with the widespread closing of the state’s coal plants. In Kansas, an abundance of wind-friendly territory has allowed for over a fourth of the state’s total electricity to be generated solely through wind power.  

Still, even with a growing number of modest victories under their belt, renewables have thus far struggled to capture a significant portion of the energy market, as compared to coal (at 30.4 percent) or natural gas (at 33.8 percent). On the whole, in terms of anything from equipment manufacturing to installation, generation, and transmission, costs for renewable energy in the United States are still higher on average than those for nonrenewable sources. While the price gap between renewable energy and natural gas is nearing a point of across-the-board convergence, it is still not there yet, and it will not be until the American renewable sector can properly address the key factors holding it back.

     Renewable energy industries in America are plagued by economic inefficiencies and a lack of technological advancement. Energy generated by wind and solar plants is difficult to store, and existing power grids frequently lack the requisite technological sophistication to utilize renewable energy. Existing transmission lines that connect remote wind and solar plants to communities are inadequate: as a result, renewable energy use becomes harder to actualize in practice. Nations like China have taken increasingly substantial steps to mass-produce equipment for renewable energy industries, helping to hasten the overall affordability of renewables’ installation. However, the United States’ failure to join other nations as a leader in renewable manufacturing has meant that jobs in the American renewable sector have grown more slowly than is competitive, and cheap renewable imports from foreign countries have made perfect targets for partisan attacks against globalization at the expense of import-driven renewable growth in the United States.

In a fundamentally market-driven nation, in order to disrupt the ascension of natural gas to energy kingpin, renewable energy must underprice its competitor each time it squares off against gas in market transactions. To do this, the renewable energy sector must buy itself time and space to grow into its own. Coal’s decline has helped wind and solar get their feet in the door. But if coal falls off too sharply, too quickly, natural gas will shove its way through first and change the locks. As natural gas captures more of the market,, it will develop a stronger hold over the American economic, social, and political spheres. Under a friendlier administration, renewable energy might have been given the final push it needed to leave natural gas behind in the dust. But, under Trump’s coal-friendly regime, environmentalists and renewable energy lobbyists will have to work smarter and harder to get the job done.     


Thinking Strategically: The Path Towards Reliance on Renewable Energy

     While the renewable energy sector may not actively benefit from federal support for the coal industry, it is not hit nearly as hard by coal protectionism as is the oil and natural gas industry, due to its comparatively smaller market share and dissimilar land-use needs. Both fossil fuels, natural gas and coal share a number of operational similarities in terms of the way that they use land and resources to excavate and develop energy. As a result of these similarities, these two industries are in more direct competition for excavation, development, and supply-based opportunities. To cement renewable energy’s hold over the power market, environmentalists and lobbyists for the sector must stop reacting to all of Trump’s pro-coal initiatives with knee-jerk opprobrium and resistance. Instead, each policy and policy rollback should be scrutinized through a cost-benefit analysis (CBA) process specific to the initiative’s medium and long-term impact on the renewable industry. When formulating stances on policies, wind, solar, and hydroelectric groups must ask: does this practice hurt us as an industry? And if so, does it hurt natural gas more? If a pro-coal move is projected to have a more consequential impact on the industries’ nonrenewable competitor, then the renewable lobby should drop the fight against it and instead spend time and resources on pushing initiatives which directly aid its own industries.

     To protect its competitive edge in domestic and global energy markets, the oil and natural gas industry has appealed to the renewable energy sector to join the fight against federal coal protection. Recently, these competing sectors have teamed up to oppose Department of Energy Secretary Rick Perry’s proposed Grid Resiliency Pricing Rule, a measure which essentially seeks to ensure that the coal and nuclear industries are able to operate profitably in wholesale energy markets, despite overarching trends towards economic decline. Representatives from the American Petroleum Institute, the Solar Energy Industries Association, and the American Wind Energy Association, among others, co-signed a joint-motion opposing the proposed pricing rule, on the grounds that it would provide an unfair economic advantage to the coal and nuclear industries.

Under a tactical CBA approach, the renewable energy sector should withdraw its opposition to the proposed GRPR. While implementation of the rule will not actively help the renewable industry to expand in the short-term, it will have a significantly more negative impact on the power of the natural gas sector. The rule props up the coal and nuclear industries at the disproportionate expense of natural gas, which currently profits from its ability to respond quickly to fluctuations in the energy market. If this rule goes into effect, it will significantly cut into the profits of the oil and gas industry, helping to weaken fossil fuel companies while renewables, comparatively, benefit.

     While natural gas spars with the federal government over pro-coal policies, the solar, wind, and hydroelectric industries must make a concerted effort to modernize their technology and increase the efficiency of renewable sources’ installation, energy generation, and storage processes. To do this, renewable energy industries need to continue securing funding and distributive favors from state and local governments. As coal continues to decline, the renewable sector should look to form closer ties with local and congressional representatives serving states that were once coal havens. Regional politicians and community movers-and-shakers will be looking for new donors and new job-creating industries to help: it is imperative that renewable energy businesses get there before natural gas comes knocking.

At the state level, natural gas lobbyists have already sought to exclude renewable energy sources from market permeation and expansion;pro-fossil fuel groups such as the American Legislative Exchange Council have inundated state governments with model legislation which directs officials to remove renewable energy tax credits and avoid all consideration of the environmental benefits of renewable energy when making decisions about the relative efficiencies of energy project proposals. Renewable industries that have established their presence in former coal states have had success at combating these attacks. For example, having proven themselves financially useful to citizens and politicians, renewable industries have enjoyed the strongest support from figures such as Dale Ross, the Republican mayor of Georgetown, Texas. For Ross, increased reliance on wind and solar energy is a “no brainer” when it comes to charting the future of his town of 65,000. In an interview with ARD, Ross explained: “This is a fact-based decision we made in Georgetown, and first and foremost it was an economic decision… We were able to secure 20-and 25-year contracts with wind and solar, and the natural gas providers would only give us a guaranteed contract rate for seven years.” The takeaway for renewable proponents here is clear: integrate into communities and states as early as possible and plan to stick around.

One way or another, Trump’s pro-coal policies will come undone. They may fail due to the efforts of a more environmentally progressive administration in the future or simply because of market inefficiencies, but, either way, they will not last long. America’s carbon emissions problem has grown to a point of environmental obscenity as a result of the nonrenewable energy sector’s effective exploitation of the nation’s profit-driven financial structure. To make meaningful strides towards mitigating climate change under the Trump administration, environmentalists and renewable energy lobbyists must do the same, by hitting natural gas, their fiercest competitor, where it hurts the most: in the wallet.

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