Tuesday, April 21, 2015

Why Millions Of Poor Will Suffer at the Hands of Obama's Coal Regulation

In June of 2014, President Obama, by executive order, directed his Environmental Protection Agency (EPA) to issue regulations that would basically eliminate all of America's more than 600 coal-fired power plants by 2030, with a third of the largest being shuttered "by" 2020 ("by" actually meaning before 2020).  As a result, 39 states, that are affected by the rule, will have just one year, by June of 2016, to come up with their initial plan to eliminate the more than 200 coal plants.

The problems with this Obama edict is that it will disproportionately punish people living in some of the poorest states in the union.

West Virginia, for example, gets 95% of its power from coal, and almost every power plant will have to be shutdown by 2030.  It will cost billions of dollars to build new natural gas plants to replace the existing ones; millions or billions more to create an infrastructure of 20 to 30 inch diameter underground pipes to feed those new plants; and, again, millions more to connect them to the existing electrical grid.  All these costs will have to be picked by by West Virginians in the form of higher electricity prices that may more than double.

All too many in that state won't be able to afford those new rates and the impact on their economy will be substantial.  West Virginia is poor.  The state's per capita income is just under $23,000 a year.  That's 20% less than what the average American makes. Nearly, 18% of the state lives below the poverty line.  That's more than 330,000 of the 1.8 million residents who are already struggling to make ends meet.  Now, they will be facing substantially higher electric bills.

According to the West Virginia government agency that oversees their coal industry, 30,000 direct jobs are involved in mining and those jobs are sure to be eliminated by 2030.  In many cases entire towns are wholly dependent on coal miner's incomes.  Hundreds of stores, restaurants, and other businesses will cease to exist when they lose their jobs. Whole towns will disappear, and, finding new jobs for all these people will be a difficult task.  For most, coal mining is all they know.  In addition, the lack of education will be an impediment to getting a new job because West Virginia ranks number one as the least educated state in the country.  Already, their population has fallen by more than 3,000 from 2013 to 2014 as more and more people seek employment outside the state.  But, these are the residents who can afford to pickup and leave with all their belongings.  Those who remain will probably be the poorest and least educated; meaning that the state will only decline in its tax revenues and business stature.

But, West Virginia isn't alone.  Kentucky gets 90% of its electricity from coal, and they too are poor; making just about $450 more a year than the average West Virginian.  The poverty rate is almost 19% against a population that is more than double that of West Virginia.  This means that more than 800,000 poor Kentuckians won't be able to afford the new electricity rates and higher retail costs that will surely come.  They too are in the bottom 10 when it comes to education, and 18,000 miners in that state will also lose their jobs by 2030.

So, in just two states, more than a million poor will suffer greatly from President Obama's shutdown of coal.  But the list of those with heavy coal dependence is long: Wyoming (85%), Indiana (84%), Missouri (83%), North Dakota (77%), Utah (76%), and so many more.  The Washington Post article referenced below includes an interactive map which shows how much each state is dependent on coal power.  Basically, the President's mandate will hurt more than half of the nation's 45 million poor in a mad rush to eliminate all coal-fired electricity in just 14 years.

Lastly, Obama's plan won't hurt some states like California and New York where there is little dependence on coal.  Of course, those states also have some of the highest electricity rates in the nation at around 14 cents per kilowatt hour.   In comparison, West Virginia is at about 8 cents per kilowatt hour, but, because of the rapid and widespread required replacement of coal, West Virginia's kilowatt rate will most likely wind up being much higher than 14 cents.


The states that will be hit hardest by the EPA’s coal regulations, in one map: http://www.washingtonpost.com/blogs/govbeat/wp/2014/06/02/the-states-that-will-be-hit-hardest-by-the-epas-coal-regulations-in-one-map/

Quick Facts West Virginia: http://quickfacts.census.gov/qfd/states/54000.html

Quick Facts Kentucky: http://quickfacts.census.gov/qfd/states/21000.html

West Virginia Coal Facts: http://www.wvminesafety.org/wvcoalfacts.htm

Kentucky Coal Facts: http://www.kftc.org/campaigns/appalachian-transition/coal-production-and-employment-trends

America's Most and Least Educated States: http://247wallst.com/special-report/2014/09/23/americas-most-and-least-educated-states/

Electricity Prices by State: http://www.eia.gov/electricity/state/

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