New study touts North Dakota benefits of lignite mining

North Dakota’s Lignite Energy Council said May 2 that a new economic study from the North Dakota State University (NDSU) shows that North Dakotans not only benefit from low cost and reliable electricity produced by the state’s lignite industry but also because of employment, tax revenues and related business activities.

Randy Coon, an NDSU researcher who conducted the study, said the lignite industry is expected to contribute about $3.3bn in total business activity in 2013 along with generating about $97m in taxes paid to the state. 

The lignite industry is also a large employer with approximately 4,300 direct employees in 2013 and another 12,000 secondary employees, such as those who work for contractors and suppliers, who provide goods and services to the mines and plants. Major producers are Westmoreland Coal and North American Coal.

In his report, Coon noted that the lignite industry provides average wages at the mines and power plants that are higher than almost all other industries in North Dakota. Average mining wages for Mercer County in 2011 were nearly $90,000. Average wages in 2011 at the power plants were more than $80,000.

“This annual economic survey clearly measures the consistency and economic contributions of the lignite industry to North Dakota,” said Steve Van Dyke, vice president of communications for the council. “While the jobs are concentrated in Mercer, McLean and Oliver Counties, the economic benefits of this industry are felt throughout the state.”

The study was commissioned by the council, a trade association representing the state’s lignite mines, which produced 27.5 million tons of lignite in 2012, along with the lignite-based power plants, the Dakota Gasification Co. and more than 350 companies that supply goods and services to the lignite industry.

North Dakota has produced an average of 30 million tons of lignite coal annually since 1988. The majority of the coal is used to generate electricity. Lignite is also used to fuel the Great Plains Synfuels Plant, which produces synthetic natural gas and value-added byproducts including fertilizers and also CO2, which is used to enhance oil production in Canadian oil fields near Weyburn, Saskatchewan.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.