Friday, January 15, 2016

The feds and coal: no longer justifying business as usual

Obama Administration Halts New Coal Leases, Gives Climate Policy a Boost

Moratorium on future coal leases is cheered by climate activists, but long term policy will decide how much coal is left in the ground.

BY JOHN H. CUSHMAN JR., INSIDECLIMATE NEWS
JAN 15, 2016

The Obama administration's announcement on Friday that it will suspend new coal leasing on federal lands and overhaul the program to better reflect environmental costs could be a turning point in climate policy. It is a concrete measure toward leaving fossil fuels in the ground, as the science demands.

But it was the invisible hand of the coal markets, not the inexorable thrust of the climate models, that ultimately drove the federal government to this point.

Coal companies have been going bankrupt, even a they have been granted access to a virtually limitless resource at almost negligible prices. So the federal government, as the steward of the public patrimony, could no longer justify business as usual.

"The business partnership between the federal government and the coal industry no longer works," said Tom Sanzillo, director of finance for the Institute for Energy Economics and Financial Analysis (IEEFA), which has long criticized federal coal leasing practices.

"It became apparent that the industry does not have a strategy for moving forward in the face of a shrinking market."

The market realities opened the door to a review that, if it ends up imposing climate accountability on the coal industry, could lock up huge quantities of carbon fuels for decades to come.

(Continued here.)

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