Obama administration hits pause on new coal leases

The new plan will require federal officials, when weighing land use decisions, to consider how mining and burning coal adds to greenhouse gas pollution, said environmental group sources familiar with the plans.

“It is abundantly clear that times are different than they were 30 years ago, and the time for review (of the coal leasing program) is now”, Jewell told reporters in a conference call.

The action builds on Jewell’s call last March for an open and honest conversation about modernizing the federal coal program.

The Obama administration announced the temporary ban Friday, saying that the coal-leasing program is outdated, and needed re-examination.

DETI: Since the overwhelming bulk of the federal coal is mined out of the basin in Wyoming, it’s obviously directed towards us.

It does not affect current leases where coal mining is now happening.

About 40 percent of the coal mined in the USA comes from federal tracts, mostly in the West. Most coal is burned to generate electricity, accounting for 11 percent of the nation’s carbon dioxide emissions, according to some estimates.

The Interior Department manages about 230 million hectares of coal lands that can be leased by miners. Pausing the federal leasing program will cost jobs and revenue that could go to schools, bridges, and roads.

There is enough coal now under lease to maintain production levels on federal lands for the next 20 years, the agency said.

It’s unclear what impact the moratorium will have on many coal companies given the declining domestic demand, coupled with the closure of numerous coal-fired power plants around the country. This could soothe the public with assurances that nothing will really change, only to see a full cessation of coal leases when the report comes out, or an increase in fees that makes mining less economical.

The proposal will have widespread ramifications in Wyoming, the country’s top coal-producing state where the majority of mining is done on federal land.

Sen. Maria Cantwell, D-Wash., said taxpayers are being shortchanged on royalties that do not reflect the true costs of mining, both in terms of the economic value derived by mining companies and mining’s impact on the environment.

“Coal on federal land belongs to all Americans, but the president is denying people access to their own abundant, low-priced energy source”, the Wisconsin congressman said. “That rule to us looks like it’s meant to more immediately stop federal coal mining”.

However, by 2014, we were back to business as usual at the Interior Department when it came to leasing our nation’s coal.

But energy-markets analysts said they weren’t sure the Obama administration’s move would have a major effect on energy markets. But the coal industry is clearly struggling even before any of the government policies have been finalized.

The review is expected to take three years, so that is how long the moratorium is expected to last, though a new president that takes office next year could change that policy.

“I am confident we will get a good way down the track in this administration”, she said, although officials later acknowledged that the next president will not be legally bound to complete the review.

Environmental groups had pressed the White House for years to freeze fossil fuel leases, arguing that allowing coal development on public land undermines the president’s climate agenda.

Michael Brune, executive director of the Sierra Club, applauded the administration’s action.

Almost 90 percent of coal tracts leased by the Interior Department receive just a single bid, and royalty rates have remain unchanged since 1976.

The Bureau of Land Management, which oversees the program, also will be required to publicly post requests to lease coal or reduce royalties.