Hard economic times have prompted West Virginia to look toward a future that depends less on coal and more on renewable energy, a higher-technology job market and even a price on climate-warming carbon dioxide.
The changes in store for West Virginia were the focus of a conference last week at West Virginia University that brought together nearly 200 government leaders, energy and economic development experts, coal industry executives and civil society organizers aimed at seeing what the state’s post-coal future holds.
I made the three-hour drive from Washington, D.C. to Morgantown with WRI economist Noah Kaufman to hear how a West Virginia audience would respond to his new research that showed how a carbon price can benefit coal communities and low-income households. In this scenic university town, coal dominates the skyline. Whisked across campus in the university’s unique Personal Transportation System, we passed a coal-fired power plant on the banks of the Monongahela River.
An Industry in Crisis
The conference began with a grave picture of how coal’s decline has impacted workers. In a state where the coal industry has historically been a key employer, declines in profitability among the largest producers have led to extreme job losses. Many counties in West Virginia have lost as many as one-third of their available jobs. John Deskins, director of WVU’s Bureau of Business and Economic Research said that in the last 10 years, West Virginia’s annual coal production has dropped from 150 million tons to a projected 90, or even 80 million tons in 2016.
The decline of coal is etched in recent headlines: Peabody Energy, the largest U.S. coal company, filed for bankruptcy protection on April 13; one week earlier, the two largest coal mines in the United States announced massive layoffs. The collapses resonate in the broader community: In Boone County, West Virginia, almost 70 staff in the school district were laid off due to reduced enrollment and a sharp drop in tax revenue.
That employment picture has knock-on effects, according to Charles Patton, CEO of Appalachian Power. He told us that one-quarter of his utility’s one million customers are delinquent on their bills. Patton sees a different path ahead for the state: From 2012 to 2025, through the use of new technology and lower-cost natural gas, Appalachian Power will decrease the amount of coal it uses for power generation from 74 percent to 53 percent.
Support for Workers in the Transition
Workforce training is one key to West Virginia’s lower-carbon future. For example, the Coalfield Development Corporation trains workers to earn degrees in new industries including sustainable construction, solar panel installation, woodworking and agriculture. REFRESH Appalachia aims to build a local food economy in West Virginia’s southern coalfields. Ben Gilmer, the initiative’s president, notes that the state spends $6 billion on food, but produces only $1 billion worth, so the program trains farmers to increase the locally produced food supply while spurring the local economy.
Universities are also training graduates for an economy beyond coal. In 2017, one WVU campus will relocate to a coalfield location, with special programs in tourism, culinary arts, nursing, recreation, information technology and construction. West Virginia University already has renowned robotics and forensics programs.
Such efforts are not limited to West Virginia. Jeff Whitefield, executive director of Eastern Kentucky Concentrated Employment Program, discussed an initiative to train miners in computer coding. Last year, his program received a $7.5 million grant for training coal miners who have lost their jobs.
The Government’s Role in Moving Away from Coal
Facing a fiscal emergency due in large part to declining tax revenue from coal companies and workers, West Virginia needs new sources of revenue to provide basic government services for all residents and to invest in the key components of a diversified economy such as broadband internet, education and infrastructure. West Virginia legislators now face a $238.8 million shortfall in the budget, and have delayed action on spending measures until a special session later this spring, the first time since 2009 that the legislature has adjourned without approving a budget.
The RECLAIM Act (HR 4456), sponsored by five West Virginia representatives in the U.S. Congress, would release $1 billion from the Abandoned Mine Reclamation Fund to communities that have traditionally worked in the coal industry. Two weeks ago, the Obama administration made available $65.8 million for economic development and worker training in coal communities, and the administration has also developed the POWER Plus plan, a $10 billion dollar proposal that would help coal communities create more diverse economies. West Virginia’s senators have proposed to Congress lifetime guarantees for coal miners’ pensions and health benefits in the Miners Protection Act.
The state has also actively recruited new businesses to West Virginia. Procter & Gamble is set to open a new manufacturing plant near Martinsburg that will employ 700 people by 2019.
A Long-Term Plan for West Virginia
At the conference, WRI’s Noah Kaufman and Adele Morris of the Brookings Institution both spoke about how a national carbon price could ease the transition for economies dependent on coal. A carbon price could generate revenue of hundreds of billions of dollars per year, and a small percentage of that money would imply billions of dollars for economic development and worker protection in coal communities.
Throughout the conference, speakers and participants repeated the call to shift the narrative for West Virginia’s future. Civil society groups like What’s Next, West Virginia? and Generation Charleston—and the conference itself, organized by the state’s leading university—are advancing this conversation. With the industry in crisis, it’s increasingly clear that the interests of coal communities and coal companies no longer align. The question now is whether West Virginians from all walks of life step forward to support policies that deliver resources for workers and develop a diverse economy in a future beyond fossil fuels.