Obama Achieves Goal of “Breaking” the Coal Industry

Not helping Peabody was the development of practices like hydraulic fracturing and horizontal drilling. With these practices providing increased access to natural gases, Peabody and other coal companies saw demand for their product decrease. Of course, this is not to minimize the responsibility of Obama and his fellow progressives in breaking Peabody:

“With respect to the anti-coal Obama administration and Congress, the coal industry thought that problem could be managed. Maybe even a deal could get cut. A senior Peabody executive told me in the spring of 2009 that it supported the Waxman-Markey cap-and-trade bill because it would settle the issue and provide a path forward for the industry. At this time, much of the coal industry was operating under the illusion that carbon dioxide emissions could be affordably captured and stored underground, so the modest emissions cuts contemplated by the bill could be achieved.

Although Waxman-Markey squeaked by in a 219-212 House vote, it was never brought up in the Senate and other Senate efforts to pass a cap-and-trade bill faltered — thanks largely to the coincidental rise of the tea party. With the failure of cap-and-trade in Congress, Obama turned to the regulatory agencies he controlled to wage war on the coal industry, the most powerful of which was the Environmental Protection Agency. The EPA began issuing a series of devastating anti-coal regulations.

The coal industry was ill-prepared to fight the EPA — an aggressively arrogant, if not entirely rogue, activist agency. The EPA took advantage of the fact that its rules didn’t target the coal industry directly, but instead pressured the coal industry’s customers — coal-burning electric utilities. The EPA’s regulations forced the utilities to reduce emissions from their coal plants.

The EPA regulation known as the Mercury Air Transport Standard was so expensive for utilities to implement that it made more economic sense just to shutter many of their coal-burning power plants — a task made easier by the surge in cheap natural gas and the fact that the moribund Obama economy has not expanded in such a way as to necessitate an meaningful increases in electricity generation.

It’s not that natural gas is necessarily a less expensive way to generate electricity, but it became cost-competitive with coal. And given the regulatory and political pressure on utilities to not burn coal, utilities began switching from coal to gas wherever possible. The natural gas glut has also placed a price ceiling on coal that dramatically thinned the profit margin from coal mining. As the Obama administration has slow-walked the approval of natural gas export terminals, the gas glut is here to stay.”

Source: Breitbart

Photo: USNews