McAteer, J. Davitt

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Volume 86Issue 3 The National Coal Issue Article 8April 1984Coal Resource Development--Toward a RationalPolicyJ. Davitt McAteerCenter for Law and Social PolicyFollow this and additional works at: https://researchrepository.wvu.edu/wvlrPart of the Oil, Gas, and Mineral Law CommonsThis Essay is brought to you for free and open access by the WVU College of Law at The Research Repository @ WVU. It has been accepted forinclusion in West Virginia Law Review by an authorized editor of The Research Repository @ WVU. For more information, please contactian.harmon@mail.wvu.edu.Recommended CitationJ. D. McAteer, Coal Resource Development--Toward a Rational Policy, 86 W. Va. L. Rev. (1984).Available at: https://researchrepository.wvu.edu/wvlr/vol86/iss3/8COAL RESOURCE DEVELOPMENT-TOWARDA RATIONAL POLICYJ. DAVITT MCATEER*I. INTRODUCTIONFor anyone concerned with the coal mining industry, it is difficult not tobe pessimistic about the immediate future and indeed about the long termfuture of coal, particularly in Appalachia. On virtually every front, coal is ex-periencing rough times. The decline in the steel industry has meant a sharpdownturn in the demand for metallurgical coal. The once ever-expanding de-mand for electricity has slowed considerably. Promising overseas marketshave been drastically reduced. Other nations, including Poland, South Africa,Australia, and China, are now competing with the United States for oncesecure markets. In addition, the world-wide recession has limited the needfor coal generally.In the face of such economic hardship, it would seem, therefore, apeculiar time to be proposing a reform package for this industry. But withoutsuch a reformation, coal will not become a viable alternative to oil, naturalgas, or for that matter, solar energy.The predicament is that while coal is domestically plentiful, its produc-tion and use entail such problems that it is still generally considered a fuel oflast resort. The problems it creates in the areas of health, safety and the en-vironment, leave a perception that coal carries too much baggage to be thefuel of first choice. Coal is chosen, therefore, only when events conspire togive it a temporary cost advantage.The problem, simply put, is whether coal will become an industry which,by providing a safe, clean, economical fuel, can recapture its share of theenergy market or whether coal will continue to be a reflex industry awaitingfurther developments in the Persian Gulf.The coal industry has experienced difficult periods throughout itshistory. Unforturnately, it has been slow to learn the lessons which these dif-ficulties could teach. Presently, with the control of the industry in the handsof oil and other multi-faceted energy corporations, it is even less likely that arational policy will develop as a result of the present economicrecession/depression in coal, but indeed that is the challenge. If coal could beproduced in a safe, healthy, environmentally sound and economical manner,the markets which have traditionally relied upon oil and natural gas would* B.A., 1966, Wheeling College; J.D., 1970, West Virginia University.Attorney with the Center for Law and Social Policy, Washington, D.C. Mr. McAteer hasrepresented miners, widows and families in health and safety matters, has done extensiveresearch and writing in the mine safety area and has been a member of the National Coal IssueAdvisory Board since 1980.1McAteer: Coal Resource Development--Toward a Rational PolicyPublished by The Research Repository @ WVU, 1984WEST VIRGINIA LA W REVIEWreturn to a stable, domestic fuel, and United States energy policy would notbe tied to the Strait of Hormuz.II. THE ISSUESRestated, the fundamental question is: can this industry develop a safe,environmentally sound, economical approach which serves both the con-sumers of electricity, steel, and other energy-dependent products, while atthe same time benefiting the miners, mine community, mine management,and investors?Coal has a negative historical image, some part of which is justlydeserved: the gritty legions of miners leaving the work place; the abandonedmountainsides slashed and torn apart by irresponsible strip miners; thedilapidated company towns; the high accident rates; the frequent disasters.Unfortunately, the responsible operators and concerned companies have beenovershadowed and historically outnumbered by the irresponsible operators.Mine health and safety has been a black mark on the industry since its incep-tion in the 18th century. Only by force of law have some operators made eventhe modest improvements required to make mines minimally safe.Environmentally, mining has all too often been typified by irresponsibleconduct on the part of many operators. It is simply easier to pass along thesocial cost to the community at large than to pay the cost of cleaning up one'sown destruction. More recently, the acid rain issue has become more andmore of an impediment to an expanding market. Again, not all companieshave acted or continue to act with reckless disregard of their responsibilities.Some have operated responsibly and with concern for people and com-munities.Unfortunately, however, it would be a mistake to think that irresponsiblemining is a matter of history. Environmental destruction by major Americanenergy giants continues. Corporations which devote large budgets to improv-ing public relations encourage their subsidiaries and smaller contractoperators to mine in a manner inconsistent with generally accepted safe min-ing practices. The corporate rationale for such conduct is simply hardeconomics. "It's cheaper, and if I don't do it, the next guy will." Such logic hasand will continue to cause this industry to bear the burden of its past image.But this industry isn't concerned just now with its image or its en-vironmental record. Coal is suffering an economic depression. This problemstems in part from the fact that coal is thought of as the secondary or lessdesirable fuel source, as a substitute for oil. If oil is cut off, we then turn tocoal, or if OPEC raises oil prices, coal can be substituted until oil againbecomes competitive. If, tomorrow, a group of Middle East terrorists orunemployed American miners were to blockade the Strait of Hormuz, coalwould boom again. But until the coal industry squarely addresses its own pro-blems it will continue to be a second-choice fuel, after oil or natural gas.[Vol.862West Virginia Law Review, Vol. 86, Iss. 3 [1984], Art. 8https://researchrepository.wvu.edu/wvlr/vol86/iss3/8COAL RESOURCE DEVELOPMENTThis is especially ironic, because the world's oil supplies are beingdepleted and will be curtailed in the not so distant future, raising the ques-tion of where the next source of energy will be found. In short, where is thecoal? The largest known deposits are in the world's three largest and mostpowerful countries-Union of Soviet Socialist Republics, the People'sRepublic of China, and the United States of America.These facts make the future of coal critical to the future of this country'senergy needs. But given the uneven historical development of coal in theUnited States and the problems of the industry, logic dictates that theUnited States industry be made a safe, environmentally sound, economicallystable industry. What is needed is a rationalization of the industry -a plan toaddress its problems.A. Safety and HealthThe years 1982 and 1983 have been among the safest years in the historyof American coal mining. This achievement, for which the Reagan Admin-istration would like to take full credit, is the result of much effort by minersand their advocates in Congresses and administrations past. The efforts pro-duced the Coal Mine Health and Safety Act of 1969 and the Federal Mine andHealth Safety Act of 1977, two durable pieces of landmark legislation whichhave withstood pernicious efforts to weaken their provisions. The causes ofthe current decrease in accidents are elusive. Those who endorse this admin-istration's approach conclude that it vindicates their emphasis on "co-opera-tion between management and government." Others contend it simply is areflection of the decline in coal production-especially in the more dangerousunderground and small mines. Much of the production growth in the recentpast has been concentrated at large surface mines which typically have alower accident rate. This fact, coupled with the economic collapse of the pasttwo years, has led to the closing of many marginal and small mines whichhistorically have a very poor safety record. The current Administration haslinked the decline in accidents to its de-emphasis on enforcement and regula-tion. But only with the recovery of the coal market, and the reopening ofmany idled mines, will analysts be in a position to verify or contest this claim.The danger, which is readily apparent, is that with the return to full pro-duction, and its concomitant drive for productivity gains, we will have areturn to unacceptably high accident rates. Structurally, little has been doneby this Administration which could arguably be said to improve, for the longrun, the conditions for health and safety in the mines. But can mines be madesafer? Or are we doomed to continue on the course of higher accident ratesaccompanying higher production? Phrased another way-why are someunderground coal mines in the United States safer than others? What can welearn from them?This question was posed by the National Academy of Sciences-National198413McAteer: Coal Resource Development--Toward a Rational PolicyPublished by The Research Repository @ WVU, 1984WEST VIRGINIA LAW REVIEWResearch Council, Committee on Underground Coal Mine Safety. This panel'sthree findings are most interesting.The first finding that "the achievement of and maintenance of safe minesmust come from the management," is a radical departure from conventionalwisdom that miners' mistakes are the primary cause of most accidents. Man-agement alone, the Committee found, had the authority, control over prior-ities, and resources to make changes happen. This commitment must be ge-nuine, consistent, and sustained, and must be made at the highest level ofmanagement. Secondly, the study stressed cooperation between managementand labor and thirdly, the importance of education and training.Can the industry operate safely? Yes.B. EnvironmentSecondly, can mining be conducted in an environmentally sound mannerwhich does not destroy the streams, air, water or lands around which the coallies and still be profitable?The answer to this question is also yes. Contrary to skeptics' predictions,the Surface Mining Control and Reclamation Act of 1977 did not bankrupt thestrip mining industry. Some marginal operators who were passing the cost ofreclamation to the taxpayers have been forced to cease operations or conductthemselves like any other business which must bear the burden of productionand reclamation costs, and it should not be otherwise.Additionally, the economics of strip mining are such that the cost of sen-sible mining and reclamation, even when included in the price, is still lessthan the cost of underground mining.'COMMITTEE ON UNDERGROUND COAL MINE SAFETY, COMMISSION ON ENGINEERING AND TECH-NICAL SYSTEMS, NATIONAL RESEARCH COUNCIL, TOWARD SAFER UNDERGROUND COAL MINES 5 (1982).I. There are persistent and large differences between the injury rates of com-panies that control underground coal mines. These differences could not be explained byphysical, technological, or geographical conditions, but are due to factors internal to thecompanies. In our opinion, the most important of these factors are:A. Management's commitment, as reflected by the attention and resources itdevotes to improving safety.B. Cooperation between management and labor in developing and implementingsafety programs.C. The quality of training of employees and managers of coal mining companies.II. There is a strong correlation between age and disabling injuries. The disablinginjury rate for miners 18-24 years of age is about three times that of miners over 45, andabout twice that of miners between 25 and 45.III. There is a strong correlation between mine size and fatal injuries. The fatalityrate in mines with 50 or fewer employees is nearly three times that of large mines (withover 250 employees), and about twice that of intermediate-sized mines (with 51-250employees).2 In 1978, worldwide mine head production cost averaged $10-15 per ton for surface mines[Vol.864West Virginia Law Review, Vol. 86, Iss. 3 [1984], Art. 8https://researchrepository.wvu.edu/wvlr/vol86/iss3/8COAL RESOURCE DEVELOPMENTCoal is being surface mined in England, Federal Republic of Germany andAustralia in an environmentally sound and profitable manner. It can also bedone in the United States.In addition, the issue of acid rain must be addressed, not by simply deny-ing the existence of the problem, as some in the industry would do, nor byshutting down the production of high sulphur coal, sending even more minersto the unemployment lines. Technically, solutions exist. By using the bestavailable technology, it is possible to use the highest sulfur coal available,and still dramatically reduce emission of sulfur dioxide. Pending before theUnited States Congess is H.R. 3400, the Sikorski/Waxman Acid Rain Bill,which, by using presently available technology will reduce sulfur dioxideemissions by fifty percent. This will be accomplished without job reduction,job dislocation or without overall loss in mine employment. Technical con-trols such as flue-gas desulfurization and other technologies are proven,workable systems. Sufficient experience in the United States, Europe, andJapan has put to rest any claim that these systems are not effective or'reliable. New York State recently allowed Consolidated Edison to convertfrom oil/natural gas to coal in two New York City plants. These plants,Ravenswood and Arthurkill, both located within a city which has perhaps themost stringent emissions standards for any United States metropolitan area,can use coal in an environmentally acceptable manner. The state determinedthat the conversion to coal would be quite economical, with only a minimal in-crease in emissions. The miner's union, environmentalists, and governmentcan and must work to obtain a politically acceptable solution while the in-dustry itself must finance the technology and further research to stay com-petitive with other non-acid rain producing fuels.We are left then with the question of reclamation. The issue is notwhether reclamation can technically be achieved-the question is when willit be achieved. Reclamation is part of the cost of doing business. The era ofavoiding the social cost by dumping the cost on the taxpayers has passed.While irresponsible and callous companies are still operating destructively ona grand scale, it is simply a question of time before those operators arebrought to justice. The Surface Mine Act is not going to be repealed. It is im-perative that responsible elements in the industry bring their fellowoperators along, by encouragement or denunciation. And the sooner this ad-ministration applies the Act to all operators the better off the entire industrywill be. The enforcement of the Act, although susceptible to political mani-pulation, will ultimately be carried out. This industry would be better servedif it encouraged rational enforcement sooner rather than later.III. CONCLUSIONIt is clear from the preceding that (1) coal represents an important, basicresource that has been under-used historically and strategically; (2) its use1984]5McAteer: Coal Resource Development--Toward a Rational PolicyPublished by The Research Repository @ WVU, 1984WEST VIRGINIA LA W REVIEWwill increase, although more slowly than was anticipated in the recent past;3(3) health and safety will continue to be a major difficulty; and (4) thenegative environmental impact which coal has brought to the communitiesand regions where it is produced and used will also continue to be a problem.These problems contribute to the lack of coal utilization and to the view thatcoal is not a primary fuel source. Most importantly, these problems result incoal policy being dictated by non-coal interests.Can these problems be overcome? The answer, most definitely, is yes.The consistent failure of the industry as a whole to address its problemspoints to the need for a new approach-more specifically, for a new coalpolicy. Present coal policy is simply a policy of inaction, to the effect that non-coal fuel, notably foreign oil, is our principal fuel despite the politcal risksassociated with over-reliance upon it, and coal, because of its problems, isonly a substitute. A coal policy which reverses this approach is imperative.Again, the basic argument is compelling. The United States has adomestic fuel in sufficient quantities to use and sell which could reduce, if noteliminate, our reliance on foreign oil sources, create employment in areas ofhigh unemployment, and improve the balance of trade. Events outside of ourown control would not then determine our national energy policy. But beforecoal can return to the forefront, a pragmatic solution is needed to solve thepractical problems which have caused coal to be perceived as a less thandesirable source. Such an approach is desperately needed in Appalachia andin the western boom towns and in the mining towns of the Midwest. Seriousefforts must be made to resolve environmental concerns, and to addresssafety and health needs. And the entire industry, labor, government and thepublic, must foster increases in the use of coal as the primary source of fuel.All these efforts need to be part of a coordinated strategy. Such an approachmust include environmentalists as well as productionists. Without such a co-ordinated approach, volatile economic developments will continue within theindustry, and coal will continue to be a reactive industry awaiting the actionsof others to decide its future. Such a solution should be unacceptable -unac-ceptable from a national-security standpoint, unacceptable from the stand-point of its impact on the people who produce coal, and unacceptable from thestandpoint of the people who use coal. And that's all of us.and $20-30 for underground mines. Secondly, highly mechanized, large strip mines such as exist inthe Federal Republic of Germany, the western United States and Australia, have cost as low as$6-10 per ton. WORLD BANK, COAL DEVELOPMENT POTENTIAL AND PROSPECTS IN THE DEVELOPINGCOUNTRIES iii, 3 (1979).3 COMPTROLLER GENERAL OF THE UNITED STATES, U.S. COAL DEVELOPMENT-PROMISE, UNCER.TAINTIES-REPORT TO CONGRESS at i (1977). The Plan called for coal production to have reached 1.2billion tons by 1985.[Vol.866West Virginia Law Review, Vol. 86, Iss. 3 [1984], Art. 8https://researchrepository.wvu.edu/wvlr/vol86/iss3/8

Coal Resource Development--Toward a Rational Policy

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Coal Resource Development--Toward a Rational Policy

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