Coal Age

NOV 2015

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from its staff. Spokesperson Bill Stanhouse told the Tuscaloosa News the furloughs were effective the evening of September 14. While weak coal demand was cited for the decision, he noted that the mine "is not completely idle" and will keep running at a reduced production rate. "We will continue to monitor the market conditions," he added. Sister mine No. 7 in Brookwood laid off 194 earlier this year w hen it, too, ramped down its production. Alabama-headquartered parent company Walter Energy filed for Chapter 11 bankruptcy reorganization earlier this year. Alliance Battles to Keep Share of the Market Joseph Craft III, veteran president and CEO of Alliance Resource Partners, one of the most profitable and lowest-cost coal produc- ers in the U.S., believes domestic coal demand in 2016 will be sim- ilar to 2015, with foreign exports down and natural gas prices stay- ing low. Alliance, riding 14 consecutive years of record performance, is fighting to maintain market share. Craft discussed his company's third-quarter results and out- look for the next year in a late October conference call with ana- l ysts. Net income for the Tulsa, Oklahoma-based company fell to $83.4 million in the July-September period from $120 million a year ago, even though it produced a record 11.5 million tons of steam coal, more than a million tons above its 10.2 million ton output in the third quarter of 2014. Despite higher production, coal sales revenues of $547.5 mil- lion in the latest quarter were slightly lower than the comparable n e w s c o n t i n u e d B Y L U K E P O P O V I C H The President's Clean Power Trip — We'll All Pay for His Paris Vacation D A T E L I N E W A S H I N G T O N The president will be in Paris, maybe as you are read- ing this, burnishing his reputation at the United Nation's global green gabfest over climate change. Fresh off his veto of the Keystone XL Pipeline project — eliminating, at one stroke, tens of thousands of good paying jobs — the president is set to show the multitude gathering in the City of Lights his leader- ship on the global warming issue. In preparation for his November 30 trip, officials from his chief job-killing bureaucracy at the Environmental Protection Agency (EPA) fanned out across the country to tout their leader's controversial Clean Power Plan (CPP), the one that promises to reduce carbon emissions from the nation's power plants along with the standard of living for millions of Americans. The problem for the president is that he is leading environmental activists, not his country. This regulation defies Congress, a majority of the states and public opinion. Congress has repeatedly rejected costly plans to cap carbon dioxide emissions from power plants, which is the real intention of this plan. More than half of the states have sued the EPA to stop the plan. And opinion polls by the Gallup organization con- tinue to show voters won't pay for it. In fact, congressional majorities are preparing resolutions demand- ing the EPA withdraw the rule while they vote down the president's spendy promises to finance U.N. climate change projects. Who says this is a "do nothing" Congress? The plan also defies common sense. Logic doesn't support claims by the EPA that replacing affordable sources of electricity like coal with far costlier sources will somehow lower electricity costs. On the con- trary, the EPA's climate change regulation amounts to an energy tax, and an expensive one. A new analysis by Energy Ventures Analysis (EVA), an independent economic consultancy, shows the irreparable harm the CPP inflicts on the country, especially in 46 states due for double-digit increases in wholesale electricity prices. By 2030, EVA projects Americans will have paid $214 billion more for wholesale electricity than they would pay without this regulation. The bills start to come due in 2022, when consumers will shell out an additional $15 billion a year, and by 2030 pay $31 billion a year more — overall a 21% cost increase. Add the costs of lost jobs in manufacturing, less affordable energy sources and the estimated $64 billion tab for replacing lost power plant capacity, and you begin to understand why only NRDC, the Sierra Club and billionaire hedge fund managers support it and why many others might view it as an energy tax. That's not what the EPA calls it. But with less money in the family budget for groceries, for the occasional evening out, for paying monthly bills, that's what consumers might call it. Driving these costs is the Obama administration's determination to eliminate fossil energy from the mix of fuels that generate electricity — regardless of the burden on households and businesses. Coal generates 39% of the nation's elec- tricity, more than any other fuel. So removing it from the fuel mix, espe- cially in coal states, will raise demand — and prices — for alternative fuels to fill the gap. The EPA dismisses the pain to consumers as "roughly the cost of a gallon of milk per month." But most American families expect, and many low-income families rely, on affordable electricity to balance the budget. And it's exactly affordable, coal-generated electricity that the administration now wants Americans to use less of. At the same time, this rule will increase the number of low-income American families. When the president stands before his French hosts to intone his leadership on climate change, about 1.3 billion people won't hear him. Without electricity, they don't have TVs. Or health care, kids' education, longevity. Baguette anyone? Luke Popovich is a spokesperson for the National Mining Association, the industry's trade group based in Washington, D.C. 12 www.coalage.com November 2015

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