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Coal Report January 2, 2012

Coal Report January 2, 2012

Coal Report 01-02-12

2011 goes down as the second-safest year on record in the nation’s coal mines, at least in terms of fatal accidents. 21 American coal miners died on the job last year, according to the Associated Press. Kentucky had the highest state toll, 8, followed by West Virginia at 6. The government’s chief safety regulator, Joe Main of the Mine Safety and Health Administration, said stricter enforcement of safety rules helped keep the death toll down. Main noted MSHA’s decision to target mines that are known to have safety problems, “I just believe that is making a real difference in the mining industry in terms of cleaning up some of the more difficult coal mines.”

Many Kentucky coal miners have felt for years that the deck is stacked against them when it comes to getting compensation for black lung. Now the Kentucky Supreme Court agrees. In a decision announced just before Christmas, the state’s high court ruled that the system for deciding who gets benefits is fundamentally unfair. In applying for workers’ compensation, coal miners face obstacles that no other workers in the state must face, and that violates the fundamental legal principle that everyone is entitled to equal protection of the law. Writing for the majority, Justice Will T. Scott said, “simply put, the 14th Amendment requires persons who are similarly situated to be treated alike.” Under a 2002 law, coal workers must meet a more difficult standard of proof than workers who claim dust problems from asbestos, rock dust, brick dust. Or other forms of pneumoconiosis. And that, the court ruled, is unfair and unconstitutional.

Miners’ advocates welcomed the decision. According to the Louisville Courier-Journal, House Speaker Greg Stumbo welcomed the decision and said he had opposed the 2002 law from the beginning. Less enthusiastic was Bill Bissett of the Kentucky Coal Association, who said the decision would result in more costs for coal companies. That seems likely. At present, an estimated 95% of black lung claims are rejected.

The court ruled that Kentucky’s black lung compensation system must be made fair and consistent. It didn’t say how that is to be done. The matter will probably come to the General Assembly this year.

A last-hour court ruling has delayed the new air quality rules that were supposed to kick in on January 1. On Friday the 30th a federal appeals court issued an order staying the rules until the court can review them. The decision was a victory for the electric utility and coal industries. The rule, which was announced in July, would require utilities to stop putting sulfur dioxide and nitrous oxide into the air. The Environmental Protection Agency estimate this would save up to 34,000 lives each year, but would increase the cost of burning coal. One Texas utility, Luminant, would have closed two coal plants on January 1 but will now keep them open until some sort of final decision comes, which could take years.

Reuters news service says that the EPA’s push to limit coal pollution has divided the electric industry. On one side are utilities like Exelon and NextEra that use natural gas or nuclear—they favor cleaner air rules—and on the other are companies like AEP and Southern Company, that want to keep relying on coal.

Another court ruling has delayed a massive coal project in Montana, reports the Associated Press.  A federal appeals court rules last week that the state did not do its homework before approving a half-billion dollar railroad project that would haul coal to Midwestern and overseas markets. The railroad is crucial to the Otter Creek tracts, a 1.5 billion-ton coal reserve recently acquired by Arch Coal. Arch and the state of Montana have pushed hard to get the project moving. The court decision, however, is a victory for ranchers and environmentalists who have fought hard against the project.

A New York state electricity company, AES, filed for bankruptcy over the weekend. AES operates six coal-fired plants and is losing money. Its competitors are using natural gas, which is getting cheaper while coal is getting more expensive, reports the Bloomberg news service.