By Tom Kentworthy. This article was published by the Center for American Progress
Further, the issues groups are raising in lawsuits challenging some
Wyoming coal sales, including better assessments of the environmental
impacts of coal leases, are ones the administration should take into
If Wyoming were a nation, it would be the third-largest
coal-producing country in the world. In 2009 the state’s 20 mines
produced 431 million tons of coal, or 40 percent of U.S. production,
according to the most recent statistics published by the U.S. Energy Information Administration.
That huge and growing river of coal flows from Wyoming’s portion of
the Powder River Basin—a West Virginia-sized region that sprawls across
northeast Wyoming and southeast Montana and contains one of the world’s
premier coal deposits. In the last two decades, coal production in the
Powder River Basin jumped nearly two-and-a-half times thanks to lower
production costs and lower sulfur content compared to coal in the
eastern United States.
The federal government controls most of Wyoming’s coal, either
because the coal underlies federal lands or because the government owns
the subsurface mineral rights to coal deposits below private land.
Unfortunately, the Obama administration has opened the coal
floodgates even further in service to an industry that is eager to ship
Wyoming coal to Asian markets. It has done so even as it makes
considerable progress in promoting renewable energy developments on public land and pledges a vigorous fight against climate change.
Two years ago, for example, President Obama’s Secretary of the
Interior Ken Salazar went to Copenhagen and delivered a keynote address
to the U.N. Conference on Climate Change in which he said, “Carbon pollution is putting our world—and our way of life—in peril.”
Then, earlier this year, Secretary Salazar went to Wyoming to
announce his department’s Bureau of Land Management, or BLM, was selling
more than 2.3 billion tons of federal coal to coal companies, calling the dirty fossil fuel “a critical component of America’s comprehensive energy portfolio as well as Wyoming’s economy.”
Why, critics ask with good reason, is the administration pushing coal
sales so hard even as it concedes in the environmental analyses for
those sales that the combustion of Powder River Basin coal is
responsible for almost 13 percent of total U.S. emissions of carbon dioxide, a prime global warming pollutant?
Last March Salazar announced that his department would be taking the
final steps in approving eight big coal lease sales totaling 2.3 billion
tons of federal coal spread across more than 21,000 acres of public
land in the Powder River Basin. By just about any standard that is a lot
of coal, and more big lease sales are in the pipeline. It’s also the
feedstock for a lot of global warming pollution: 3.9 billion tons of CO2, about equal to annual emissions from 300 coal-fired power plants, according to WildEarth Guardians.
The surge in leasing of federal coal in the West coincides with
growing interest by the coal industry in exporting U.S. coal to Pacific
Rim nations, particularly China, which critics say boosts overall global
warming pollution even as utilities in the United States are cutting
back on coal use. Controversies are already flaring in the Pacific Northwest and the northern plains over proposals to build coal-export facilities in Washington State and Oregon.
It is also sparking legal battles between the Obama administration
and environmental groups fearful of the coal sales’ impact on global
In August, for example, the Sierra Club, Defenders of Wildlife, and
WildEarth Guardians filed suit against the BLM over two Powder River
Basin lease sales that were finalized this past summer. The Belle Ayr
North and Caballo West lease sales will lead to the production of about
352 million tons of coal.
The groups’ lawsuit alleges that the BLM failed to analyze adequately the impact of the coal sales on climate change.
“In spite of the massive carbon dioxide emissions resulting from
Powder River Basin coal production,” the lawsuit charges, the BLM
“continues to issue new coal leases in the Basin without fully analyzing
the environmental impacts—particularly climate change impacts—of
increased carbon dioxide emissions resulting from this coal leasing.”
The three organizations raised similar issues in a 2010 lawsuit
against two other coal lease sales in the Powder River Basin. That
earlier lawsuit also challenged the very way the BLM goes about selling
coal leases and the agency’s determination that the Powder River
Basin—despite its huge role in the world coal economy—is not officially a
To understand these accusations, you need to start with the
Department of Interior’s basic authority to manage and lease federal
coal deposits for sale, which rests in the Mineral Leasing Act of 1920
and in 1976 amendments to the act. Under the original 1920 statute the
department must lease by competitive bids that must equal or exceed fair
market value—the market price it would obtain in a sale between a
willing seller and willing buyer. Congress left the details of how the
competitive bidding process should work to the Department of Interior.
Interior subsequently established competitive bid leasing regulations
that set up two different procedures: a competitive regional leasing
process and a leasing by application process.
The competitive regional leasing process applied only in areas the
federal government designates as coal-production regions. In those
regions BLM drives the leasing process and sets regional leasing levels
in consultation with other federal, state, and local government
agencies. It also takes into account the nation’s energy needs and what
the environmental, social, and economic effects will be of leasing.
By contrast, the leasing by application process is used in areas
outside designated coal-producing regions or in coal-producing regions
when there is an emergency need for more coal. In this more streamlined
process coal companies identify potential lease tracts, which are
generally tracts adjacent to existing mines, and the BLM decides whether
to lease them or not. In both types of lease processes, BLM does the
A dozen coal-producing regions were established following enactment
of the 1976 coal leasing amendments law, including the Powder River Coal
Production Region. A decade later, the Powder River region was
decertified by the BLM as a coal-producing region based on poor market
conditions and what the BLM characterized as “dwindling interest in coal
leasing.” That ushered in the period of “leasing by application” in the
Powder River Basin in the region that continues today even as coal
production has soared.
Critics of leasing by application charge that it results in a poor
return for American taxpayers because there are very few competitive
bids. In addition, critics say that because environmental analyses under
lease by application are site specific, rather than regional in scope,
they are less comprehensive in assessing threats to the environment,
including carbon dioxide releases from burning coal that accelerate
Environmental groups are taking a two-track approach in their efforts
to get the Powder River Basin region re-certified as a federally
recognized coal-producing region. They petitioned the BLM to make the
change in 2009 but were rebuffed by BLM director Bob Abbey in a letter
last January that defended the current lease by application process as
one that delivers fair market value to taxpayers and protects the
On the question of assessing the impact of lease sales on climate change, Abbey wrote
that it is not possible to make those assessments because “tools
necessary to quantify incremental climate changes associated with
specific [greenhouse gas] emissions are presently unavailable….”
Climate scientists recently rebutted that claim.
Their second track goes through the federal courts. In their 2010
lawsuit against two Wyoming coal sales, the Sierra Club, Defenders of
Wildlife, and WildEarth Guardians sought to force the BLM to re-certify
the Powder River Basin as a coal-producing region. A U.S. District Court
judge in Washington, D.C. summarily dismissed that claim.
But the three environmental groups are trying again, this time in a
lawsuit that challenges BLM Director Abbey’s rejection of their petition
to re-certify the Powder River Basin.
At the same time the three environmental groups, joined by four
others, are pushing Abbey and the BLM through letters and personal
meetings to explore new ways of making coal leases more competitive and
to re-examine how fair market value is determined in light of industry
interest in coal exports. The groups suggested a pilot project for
competitive leases under which BLM would identify sites and put them out
for competitive bid rather than having coal companies pick sites for
They are also encouraging the agency to incorporate greenhouse gas
emissions in its environmental analyses of potential new coal sales and
to do more large-scale, comprehensive environmental reviews that would
determine where coal production is appropriate and where not, and
include mitigation measures to reduce environmental harm from strip
mining of coal.
The Department of Interior would be wise to take those suggestions
seriously. It’s been a little more than two years since Interior
Secretary Salazar said in a secretarial order
that climate change requires his department “to change how we manage
the land, water, fish and wildlife, and cultural heritage and tribal
lands and resources we oversee.”
It’s now time for the department and the Obama administration at
large to begin figuring out how to reconcile that pledge with its
aggressive coal-leasing program.
Tom Kenworthy is a Senior Fellow at the Center for American Progress.