As coal consumption in the United States is declining, coal companies are hoping to export their dirty coal to other countries, particularly in Asia.
Strong opposition to coal export terminals on the west coast has caused these companies to turn to the Gulf coast. They may hope that people here will be less informed and less organized, but we're working to let communities know about the risks that come with coal export terminals, including toxic coal dust, polluted water and heavy rail traffic through neighborhoods. The truth is, local economies wouldn't benefit much from exporting coal and our children would pay a high price.
If you live near one of the proposed facilities or near a facility looking to expand, now is the time to act to protect your health and the health of your family. Contact us if you want to get involved.
Newsweek just ran a remarkable story about how environmental regulation is so dysfunctional in the United States that regulators “need citizens to sue in order to do our jobs.” The story leads with Gulf Restoration Network’s Scott Eustis, who gathered photos used as evidence in the suit that coalition members filed against United Bulk last spring. (For the full Newsweek story, see: http://www.newsweek.com/2014/10/31/how-civic-science-changing-environmentalism-279777.html)
Here’s an excerpt from the Newsweek story.
“…if you want to sue, how do you show that the power plant down the street is giving your kid asthma, or that the local chemical plant is illegally dumping toxic materials into the river that cuts through your town? If you’re Scott Eustis, a coastal wetland specialist at the Gulf Restoration Network, you go fly a kite. Specifically, you fly a kite to which you’ve strapped a small $40 digital camera. He has used the kite to map the waterways of the Mississippi Gulf Coast, taking aerial images of the environmental damage afflicting the region’s bayous, lakes, rivers and streams.
“The images the kite captured are now, in part, the basis of a federal lawsuit filed in March against United Bulk Terminals Davant, a coal export facility in New Orleans. The suit alleges that the terminal has violated the federal Clean Water Act by discharging hazardous coal runoff and petroleum coke into the Mississippi River. Although organizations had been monitoring the region for years, ‘it was the mid-range distance of the kite photos,’ says Eustis, ‘that provided high-resolution photographs that showed that not only was this company violating its permit but that they were dumping so much petroleum and coal byproduct that it was forming a pile.’
The story goes on to say that Scott is among a “growing number of environmentalists using unusual tools in ways pioneered by a generation of hackers and activists, and they’re collaborating and sharing their work.”
The story used the photo (below) taken by AP photographer Gerald Herbert when SouthWings, a coalition member, took him on an overflight of the United Bulk terminal last spring.
Here is a reprint of Climate Progress’s story on our campaign and the prospects for coal exports through the Gulf Coast.
By Tom Kenworthy/Climate Progress
With the battle over coal exports now in a lull in the Pacific Northwest, where four of six proposed shipping terminals have fallen by the wayside, the front line in the fight has shifted to an unlikely locale. Louisiana, a state where politicians and their constituents have long welcomed fossil fuel development, activists, citizens and local governments are now fighting a proposed export facility about 45 minutes south of New Orleans.
Armstrong Coal’s proposed RAM Terminal would ship an estimated eight million tons of coal a year from mines in Colorado, Wyoming’s Powder River Basin, and Illinois.
Opponents fear the facility, located next to a critically needed coastal restoration project, would bring coal dust and disrupt traffic in a rural community, along with contaminating sediments needed to rebuild wetlands in a state where its coastal lands vital to hurricane protection are rapidly disappearing.
Bryan Ernst, 63, built his retirement home a few miles downriver from where the RAM Terminal would be built. He already has to cope with impacts from the existing International Marine Terminals, which has just completed a big expansion of its coal export capacity.
“My biggest concern, besides the aggravation, is health,” Ernst said. “Every time we have an east wind, we have dust coming over my property and you’re breathing that stuff. You can feel it on your skin, a coating like powder.” If the RAM terminal is built, Ernst said, “we’re going to be getting it from the north and the east.”
Residents protest coal exports at a meeting of the Gretna, Louisiana city council.
CREDIT: Jeffrey Dubinsky/Andrew Breiner
To the north in Gretna, just outside New Orleans, retired schoolteacher and school librarian Gayle Bertucci worries about the increase in train traffic right in front of her home, and the possible health impacts from coal dust, if the RAM Terminal is built. Bertucci says while many in her community are “apathetic” about the planned terminal, she thinks a broader coalition can be built around the possible impacts on coastal restoration.
“Nobody cares if Gayle Bertucci has trains coming down the middle of her street,” she said, “but [Hurricane] Katrina was so traumatic, even for those of us who had no damage.”
International Marine Terminals coal export facility on the Mississippi River near Port Sulphur, Louisiana.
CREDIT: Gulf Restoration Network
Despite appeals from two local governmental bodies, the Jefferson Parish Council and the Gretna City Council, the Army Corps of Engineers on October 1 said it would not hold a public hearing on a required federal permit. A court challenge to a permit issued by the state Department of Natural Resources, however, is still pending.
“The industry has said the Gulf is their [coal export] plan B,” said Devin Martin, a Sierra Club organizer in Louisiana. Coal companies, he added, “are saying we have an unorganized populace and a corrupt political system they can take advantage of. We are here to show them that’s not true.”
The dispute in Plaquemines Parish, where two existing coal terminals and coal and petroleum coke debris have been found contaminating other coastal restoration projects, is part of a larger regional struggle against coal exports stretching from Texas to Alabama.
While a number of existing terminals in the region have recently expanded, including facilities in Convent, Devant, and Darrow, Louisiana, proposals for new terminals have not fared as well.
Three proposed terminals in Corpus Christi, Texas that would have had a combined capacity of about 25 million tons a year have been cancelled, another facility proposed for coal exports in Mobile, Alabama has been sold to the state and will be re-purposed for container shipments, and two new proposals in Louisiana appear to be on hold, according to a market report document prepared by T. Parker Host and obtained by opponents.
The key takeaway from all this activity: Big coal’s export lifeboat isn’t looking so seaworthy right now.
With a steady decline in coal’s share of the domestic electricity market, driven by a big shift to natural gas, the growth of wind and solar, and emerging federal limits on carbon pollution, U.S. coal producers have for the past few years been bravely talking up exports abroad as their salvation. To get their product to markets in Asia and Europe, they have supported plans to build or expand about a dozen and a half export terminals at U.S. ports.
But four of the six proposed terminals on the West Coast to serve Asian markets have foundered. And the remaining two, in Washington State, are only at the beginning stages of long environmental reviews and face strong political opposition from an energized public and leading political figures in the Pacific Northwest.
Perhaps more surprising is that proposals to enlarge export capacity in the Gulf Coast region are also running into heavy weather. There, as many as a half dozen plans have fallen by the wayside, and political opposition to others is building, even in fossil fuel friendly states like Texas and Louisiana.
At the same time, the price of what is known as seaborne thermal coal used in electricity production has plummeted, driven by a flood of exports from
Australia and Indonesia, and there are signs of a dramatic slowdown in consumption of foreign coal in China, which just recently renewed an import tax on foreign coal. The September Newcastle spot price of export coal from Australia was just half what it was in 2011. And as analysts increasingly predict a grim future for coal, the stock prices of U.S. producers have plummeted.
Clark Williams-Derry, deputy director of Seattle think tank Sightline, concluded simply: “The market is dethroning king coal.”
The outlook for exports is detailed in analyses conducted by the federal Energy Information Administration. In its most recent quarterly report on October 8, the EIA noted that in the second quarter of this year, U.S. coal exports fell 11.4 percent from the first quarter and were 16.5 percent below the second quarter of 2013. In a separate report on October 7, the EIA projected that exports this year would fall about 19 percent below last year, to 96 million short tons.
The coal export bubble, driven by Chinese demand, “has almost completely deflated,” said Williams-Derry, attributing the development to China investing in making improvement to its own coal industry and transport capability, to a big jump in supply by Australia and Indonesia, and a decline in demand by China.
“The coal companies are telling analysts this is a temporary phenomenon and international prices will rebound,” said Ross Macfarlane of Climate Solutions, a clean energy nonprofit in the Pacific Northwest. “But the ones we’ve been reading are telling a very different story …You are seeing the markets for seaborne coal declining precipitously.
Private reports, prepared by a number of analysts and obtained by ThinkProgress, paint a grim picture for the future of coal exports. Investment banker Jeffries, for instance, said “we believe coal prices will never materially recover … We believe coal demand has more or less peaked in China.” Similarly, Citi concluded that “thermal coal is facing twin challenges of cyclically strong supply growth and a structural decline in demand growth.”
As far as demand for U.S. coal overseas is concerned, investment research firm Morningstar said, “we believe China has reached two inflection points — one economic and one political — that lead to a decidedly different outcome: no growth at all.”
Goldman Sachs elaborated on that point by noting, “with Chinese demand for imported coal past its peak, and barring any major policy changes, we expect the seaborne market to grow at an average annual rate of [approximately] .2 percent over our forecast period to 2018. In our view, this will not be sufficient to tighten the market and lift prices above the level of marginal production cost.”
Thus, it’s little wonder that major producers are seeing precipitous declines in their stock prices. Arch Coal is trading around $2.00 per share, down from above $30 in 2011. Peabody is trading at less than around $11; it was above $50 in 2011. Alpha Natural Resources is trading around $1.60; it was above $60 in 2011. And Cloud Peak Energy, is trading around $11, down by about 50 percent since April.
In Louisiana, meanwhile, a state where former Senator John Breaux once famously said “my vote can’t be bought but it can be rented,” the environmentalist sector is feeling it may be getting some traction with the public.
“We have been tremendously successful in mobilizing people given the attitudes and stereotypes about what Louisiana people care about,” said the Sierra Club’s Devin Martin. “The stereotype is that folks in Louisiana don’t care about the environment because energy industry is so big. There is a sliver of truth to that, especially with oil and gas.”
“But,” Devin continued, “there are several things that have happened. The BP oil spill woke people up. Hurricane Katrina woke people up to the fact that coastal restoration is not just about pelicans. It’s about saving our butts. We need a healthy coast to protect us from hurricanes. That is now part of everyday conversations in Louisiana.”
Grist reported this week on a new United Kingdom fossil-fuel divestment campaign focused on banks rather than the usual targets — foundations, churches, and universities that are more attuned to lofty causes. The campaign is asking consumers to call on their banks to divest from fossil fuels, and they provide this form letter:
“As a citizen concerned about our global capacity to meet targets and reduce the effects of climate change, I cannot give my financial support to an institution that bankrolls climate change. Therefore, as a customer of your bank, I hereby make the following demands: Within the next three months, disclose all your investments in the fossil fuel industry. Within the next three months, commit to a 5- to 10-year plan to completely divest from fossil fuels. If you do not meet these requests, I will be left with no choice but to move my money to a financial institution that takes its social, ethical and environmental responsibilities seriously. I will do this in February 2015 unless you show a solid, lasting and credible commitment to fossil fuel divestment, as outlined above.”
Then, in case banks don’t respond, the campaign offers consumers a list of U.K. banks that do not invest in fossil fuels. Grist reports that the list is very short, and even shorter in the case of U.S. banks. Grist says if you want to do business with a U.S. bank that doesn’t invest in fossil fuels, you’ll probably have to look for credit unions, since generally, they’re too small to lend to the fossil fuel industry.
Also this week, Grist reported that the Chinese public ranks pollution as among the very top global threats. According to a recent Pew Research poll, one third of the people polled in China said that “pollution and the environment” are the No. 1 global threat.
In recent weeks, something amazing has been happening in the Gulf Coast of Louisiana – communities have been standing up and casting votes to ring the alarm about proposed coal export projects. As U.S. coal use has declined, mining companies are looking for a future in international markets. And while most people might think of the Pacific Northwest as ground zero for planned coal export facilities, the Gulf Coast is home to over a dozen proposed coal export terminals as well. Thankfully, as the plans to export coal through the state grow, so does the opposition from local residents.
Case in point – the small town of Gretna, Louisiana, in Jefferson Parish. This is a historic metro area of New Orleans, and it’s also the site of a proposed coal export project called the RAM coal export terminal. If constructed, the facility could see some six to eight million tons of coal and refinery waste exported overseas every year (that’s about six coal-fired power plants worth of coal). It would add to the dust and water pollution burden in the communities it neighbors by sending mile-long, uncovered coal trains running through historic neighborhoods, and it also threatens the state’s vital coastal restoration projects.
The fight over this export facility hit a milestone in September, when residents packed a Jefferson Parish Council meeting. They cheered when the council voted unanimously on a resolution that questioned the impacts that the RAM terminal would have on coastal restoration, and also called on the Army Corps of Engineers to hold public hearings and conduct a full Environmental Impact Statement on RAM.
CGCC organizers Grace Morris (far left) and Devin Martin (far right) with local residents opposed to the Ram coal export terminal.
“This was the outcome of an entire summer of outreach by the Sierra Club, our partners in the Gulf Restoration Network, and the Clean Gulf Commerce Coalition,” says Devin Martin, a New Orleans-based organizer with the Sierra Club’s Beyond Coal campaign. “We made a big push to generate turnout and demonstrate public opposition to the export terminal at the previous council meeting in August, and more than 100 people attended — it was standing room only.”
Residents worked together to phone-bank, write letters, put up yard signs, collect petition signatures, and much more to educate their neighbors and to pressure the council. They also packed the Gretna City Council meeting in July and previous educational forums. Martin credits some amazing community activists, especially Grace Morris of the Gulf Restoration Network, for such a successful movement of residents against this polluting facility.
There’s still much work left to do – especially after the Army Corps of Engineers responded to the Jefferson Parish Council vote by issuing a press release saying there’s no need for public hearings on the RAM terminal proposal. But Martin and other coal export opponents still have lots of reasons for optimism.
Momentum is building against coal exports in the Gulf. The unanimous vote by the Jefferson Parish Council on Sept. 17 was preceded by a unanimous vote by the Gretna City Council on September 10. In June, the neighboring city of Westwego passed a resolution opposing coal trains.
“While the (Jefferson Parish Council) resolution doesn’t stop the project or even force the Corps to act, the political implications cannot be overstated,” said Martin. “Jefferson is Louisiana’s second most populous parish, the home turf of some of our most powerful and infamous politicians, and so deep Red that it falls into the infrared spectrum of political leanings.”
Several publications, including Business Spectator, are reporting that U.S. coal exports continue to drop from their high in 2012. During the first half of 2014, coal exports totaled 52.3 million short tonnes, which reflects a 16 percent decline over the same period in 2013, according to Climate Spectator. The reason: Declining European demand, rising Australian and Indonesian supply. Here’s the full link, or you can access at least the graphs below.
The story also reported that 30 percent of coal exports — both metallurgical and steam — went through Gulf Coast states — Houston, Mobile, and New Orleans. Eastern ports in Baltimore and Norfolk shipped 55 per cent, while Seattle ports accounted for 4 percent.
Here’s a chart from the story, which includes several other graphics detailing the volatility of the market.