Senators: Interior’s coal leasing review is a sham with a result already decided

U.S. Senators John Barrasso (R-WY), Roy Blunt (R-MO), Shelley Moore Capito (R-WV), Steve Daines (R-MT), Mike Enzi (R-WY), Cory Gardner (R-CO), Orrin Hatch (R-UT), John Hoeven (R-ND) and Mike Lee (R-UT) sent a July 14 letter to Interior Secretary Sally Jewell calling on the Department of the Interior (DOI) to suspend its review of the federal coal program and its moratorium on new coal-lease sales.

In the letter, the senators express concern over a recent report titled, “The Economics of Coal Leasing on Federal Lands: Ensuring a Fair Return to Taxpayers,” published by the President’s Council of Economic Advisers on June 22. The senators said that by publishing this report, the White House has short-circuited DOI’s ongoing review of the coal program in violation of the National Environmental Policy Act (NEPA). Under federal law, environmental reviews “shall serve as the means of assessing the environmental impact of proposed agency actions, rather than justifying decisions already made.”

“The Council of Economic Advisers’ report has effectively turned BLM’s review of the federal coal program into a pre-baked cake,” they wrote. “The Council is an arm of the Executive Office of the President. Its Chairman serves as the President’s chief economist, is a Member of the Cabinet, and plays a lead role in setting administration policy. Its report shows that the White House has already decided that the federal coal program does not provide a fair return to the public or adequately account for externalities and to increase coal royalty payments.[4] To ensure the PEIS does not justify decisions already made, we ask that you immediately suspend development of the PEIS and the leasing moratorium for the remainder of the administration. A failure to do so will only make the PEIS and decisions purportedly based on it vulnerable to legal challenges.”

On Jan. 15 of this year, Jewell signed Secretarial Order 3338, which authorized BLM to conduct a programmatic environmental impact statement (PEIS) on the federal coal program under NEPA. To begin answering these and other questions, BLM held six public meetings between May 17 and June 28 and has solicited written comments from the public through July 28. BLM has estimated that it will take three years to complete the PEIS. In the meantime, Order 3338 prohibits BLM from issuing new federal coal leases for thermal (steam) coal.

On June 22, the President’s Council of Economic Advisers, an agency within the Executive Office of the President, issued its report which claims to answer the principal questions that you set forth in Order 3338. For example, said the senators the report states that: “A review of the coal leasing program indicates that the program has been structured in a way that misaligns incentives going back decades, resulting in a distorted coal market with an artificially low price for most Federal coal and unnecessarily low government revenue from the leasing program.”

The Council of Economic Advisers’ report shows that the White House has already decided that the federal coal program does not provide a fair return to the public or adequately account for externalities and to increase coal royalty payments, they wrote. “To ensure the PEIS does not justify decisions already made, we ask that you immediately suspend development of the PEIS and the leasing moratorium for the remainder of the administration. A failure to do so will only make the PEIS and decisions purportedly based on it vulnerable to legal challenges.”

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.