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Bad News for Big Coal

Big Coal is against the ropes -- from Kansas to Wall Street.
 
 
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This story was written by by Faiz Shakir, Amanda Terkel, Satyam Khanna, Matt Corley, Ali Frick, and Benjamin Armbruster.

So far, 2008 has been a rough year for the coal industry. Just 24 hours after Bush touted clean coal in his January State of the Union address, the Department of Energy pulled the plug on the ambitious FutureGen project, which aimed to build the first zero-emissions coal plant.

Days later, major banks such as Citigroup and Morgan Stanley, stated their concern over coal's enormous carbon footprint with emissions caps on the horizon, a consideration that " make[s] it less likely the banks will finance other coal-fired plants."

The next week, Bank of America agreed that coal plants were a bad investment. Soon after, the New York Times reported, "With opposition to coal plants rising across the country -- including a statement by three investment banks ... saying they are wary of financing new ones," utilities "are turning to natural gas to meet expected growth in demand."

Big Coal is now making a stand in Kansas, where it has been trying to get approval for two new coal plants near Holcomb, KS -- a fight that has been marked by contention since Kansas' Department of Health and Environment denied the necessary air quality permits in October. The coal industry is desperate for a win in a year that, so far, has brought bad news.

Sunflower Pressures Sebelius

Sunflower Electric, the company behind the Holcomb coal project, refused to take Kansas's October decision lying down. Weeks after the state's Department of Health and Environment's denial -- supported by Kansas Gov. Kathleen Sebelius (D) -- Sunflower, working through a front group called Kansans for Affordable Energy (KAE), published newspaper ads comparing Sebelius to Mahmoud Ahmadinejad, Vladimir Putin, and Hugo Chavez.

The front group was financed almost completely by Peabody Energy, "the world's largest private-sector coal company." Of the $145,400 in contributions KAE received, $120,000 came from Peabody and $25,000 came from Sunflower. "In other words, all but $400 of the money provided to this group of Kansans 'concerned' about 'affordable energy' came from Big King Coal," notes Kevin Grandia of the site DeSmogBlog.

Sunflower Bribes Legislature

Last week, the Kansas Senate passed a bill allowing the coal plant development, gutting the legislation of the very small carbon tax and modest energy efficiency standards. A different version passed the House, and now the bills move to a conference committee where state representatives are facing enormous pressure to bend to Big Coal's will.

Kansas State Speaker Melvin Neufeld Tuesday urged his colleagues to approve Sunflower's plans by reminding them that the state -- namely, Kansas State University -- had a lot to gain from the bargain. Sunflower has offered a quid pro quo agreement to donate $2.5 million for energy research to the university, but only if the state approves the coal plants first. Rep. Paul Davis (D) called the bribery scheme "in poor taste."

Ratcheting up the pressure, Sunflower president and CEO Earl Watkins declared this week "that if the Legislature doesn't approve the project by June 1, it may not go forward." Legislators should keep in mind a January poll that found that Kansans agreed with the state's permit denial by a 2-to-1 margin, and a majority of citizens who live in the Holcomb area support the state's decision as well.

Greenwashing Coal's Impact

When Kansas Secretary of Health and Environment Roderick Bremby rejected Sunflower's air quality permits in October, he said, " [I]t would be irresponsible to ignore emerging information about the contribution of carbon dioxide and other greenhouse gases to climate change and the potential harm to our environment and health if we do nothing." In response, Sunflower has tried to link its dirty coal with clean energy, in a TV spot promoting the "Holcomb expansion."

The ad -- which never mentions the word "coal" -- insists the plant "will be one of the cleanest, most efficient power plants of its kind." In fact, even with the best available technology, the plant will emit massive amounts of mercury, sulfur dioxide, and ash wastes. Moreover, there are no standards to limit the amount of carbon dioxide pollution emitted, and the new plants are estimated to emit at least 11 millions tons of greenhouse gases ever year.

Some representatives are falling for the misleading, unscientific campaign. Sen. Tim Huelskamp (R) declared, "CO2 is not a harmful substance. It's an average, ordinary part of our human life anywhere on this Earth. ... I'm a farmer, and we love CO2. It's a good thing." Rep. Don Myers (R) agreed: "It is all around us and you breathe it."

 
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