These five coal miners spent $95 million on lobbying before going bankrupt
Five US coal miners that recently went bankrupt spent $95 million lobbying with lawmakers and over half a billion dollars on salaries for their top executives in the decade before facing financial collapse, a report released Tuesday shows.
Coal miners “excessive” spending shows the leases helped lobbyists and executives, not the public, claims report.
According to environmental group Western Values Project, the companies — Walter Energy, Patriot Coal, Alpha Natural Resources, Arch Coal and Peabody Energy (the world's largest privately owned coal producer) — incurred in “excessive spending and reckless business investments.”
The group adds that not even tax subsidies and other incentives provided by the US government were able to save them from going down because of their spending decisions.
The document, released ahead of a Tuesday public meeting in Pittsburgh on the future of the federal coal-leasing program, claims such scheme — which leases land for coal production at a discount — has only benefitted lobbyists and executives, not the public.
The group wants the Obama administration to review the program and increase costs to better match the value of coal extracted from private land.
Currently, coal mined from private property is more expensive than the one extracted from public lands. A White House’s analysis released earlier this month shows producers only paid the US government an average of $1.70 per ton (or 4.9% of coal market value) from 2008 to 2012. Thermal coal is presently trading around $40 per tonne.
Coal miners in the US have been hard hit by power plants substituting the fossil fuel with natural gas. The country’s coal production fell to 900 million short tons in 2015, according to data released in March by the US Energy Information Administration, a 10% decline on the previous year.
And for this year, the EIA is predicting that natural gas will overtake coal as the largest energy source in the US.
Between 2000 and 2008, coal was significantly less expensive than natural gas, and coal supplied about 50% of total US generation, but that will fall to less than a third in 2016, the EIA said.