Privately-held Murray Energy, which is one of the largest coal producers in the U.S., filed suit on March 24 against Gina McCarthy, Administrator of the U.S. Environmental Protection Agency, over the agency’s alleged “War on Coal.”
The suit was filed in the U.S. District Court for the Northern District of West Virginia, a region where Ohio-based Murray Energy late last year bought several large coal mines from CONSOL Energy (NYSE: CNX). Murray Energy is headed by coal operator Robert Murray and has mines in states like Utah, Kentucky, Illinois, Ohio and West Virginia.
The lawsuit said the EPA Administrator is legally required to “conduct continuing evaluations of potential loss or shifts of employment which may result from the administration or enforcementof the provision of [the Clean Air Act] and applicable implementation plans, including whereappropriate, investigating threatened plant closures or reductions in employment allegedly resulting from such administration or enforcement.” McCarthy has failed to do so in relation to a series of new regulatory initiatives that are shutting coal-fired power plants across the country, the lawsuit said.
“The continued pressure placed on the coal industry by EPA’s administration and enforcement of the Clean Air Act, combined with the Administrator’s refusal to evaluate theimpact her actions are having on the American coal industry and the hundreds of thousands ofpeople it directly or indirectly employs, will irreparably harm Plaintiffs if allowed to continue unchecked.”
The plaintiffs in this case are Murray Energy and several of its coal-producing subsidiaries. The companies want the court to force the EPA to do those job loss evaluations in accordance with an expeditious deadline set by this court, and an injunction barring the Administrator from promulgating new regulations impacting the coal industry before completing this work.
The lawsuit didn’t say specifically why this action was filed in a federal court in West Virginia, instead of in Washington D.C., which is the normal venue for appeals of federal agency actions. Northern West Virginia is suffering heavy job losses due to the shutdown of both coal-fired power plants in and around that region, and cutbacks in coal mine employment.
The lawsuit cites a number of cases in recent years where companies like American Electric Power (NYSE: AEP), FirstEnergy (NYSE: FE) and Georgia Power have shut or said they will shut coal-fired power plants. It also described many of the announcements by coal producers of related mine closures of cutbacks.
For example, in July 2012, Murray Energy announced the closure of OhioAmerican Energy’s Red Bird West mine in Ohio, citing the Obama administration’s “war on coal.” Murray Energy’s Ohio Valley Coal unit announced it had to reduce the workforce at its Powhatan No. 6 longwall mine in Belmont County, Ohio, by 29 hourly jobs, citing the “regulatory excess” of the Obama Administration as a direct cause.
“Despite the continuing public statements of coal companies that increasingly stringent regulations have been causing or contributing to layoffs and workforce reductions in the coal industry for years, and the Clean Air Act’s express mandate that the Administrator ‘conduct continuing evaluations’ of these job losses, the Administrator has consistently refused to acknowledge either the need or the obligation to evaluate these job losses in developing new Clean Air Act regulations for the electricity generating sector or in developing its enforcement strategy against sources that use coal as a primary fuel source,” said the lawsuit. “To the contrary, the Administrator has repeatedly stated, in both her official capacity and in prior statements that EPA does not and will not evaluate the employment impacts of its regulatory actions.”