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Recent Coal Export Trends: Q4 2011

Here’s data from the latest coal report from the US Energy Information Administration, taking us up through the end of 2011:

Chart created by Sightline using data from EIA’s Quarterly Coal Report

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Driven by falling volumes leaving the Seattle Customs District, overall coal exports for the West declined during each of the last two quarters of 2011. The Seattle District shipped a bit less than 4.9 million short tons in 2011. Fourth quarter exports totaled less than 1 million, down 22 percent from the previous quarter. Coal shipments from the Los Angeles and Anchorage Customs Districts were up slightly in the fourth quarter.

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Coal Trends in Asia

With all the controversy about coal export facilities planned for the Northwest, it’s useful to examine some facts about markets in Asia, where the coal would ultimately be sold. While it’s likely that not everyone will agree about the meaning of these data, I do hope that everyone can agree about the facts.

Here’s a look at trends in the two major reference prices for Asian coal imports:

Chart created by Sightline Institute using data from the BP Statistical Review of World Energy

In recent years, coal prices have skyrocketed, particularly for “coking” coal. (“Coking” coal is used in steelmaking; “steam” coal is used for generating electricity.) Prices peaked at historic levels in 2008, roughly tripling in just 4 years. Although prices declined in 2009 and again in 2010 they remained at exceptionally high levels relative to the last few decades.

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Coal’s Spontaneous Combustion Problem

Those who are evaluating export proposals might do well to examine one little-talked-about peculiarity of Powder River Basin (PRB) coal: it has an unfortunate tendency to spontaneously combust, even in rail cars and stockpiles.

To be clear, it’s not as if coal trains will be delivering blazing cargoes. The threat is likely to be more insidious—slowly smoldering coal that is perhaps emitting noxious gases into neighboring communities. Yet the severity and toxicity of these gases are largely unkown.

Does self-ignited coal pose a genuine pubic health risk or is it little more than a handling annoyance for coal shippers? We don’t know. But we do know that even the coal industry says self-ignition is a problem:

Operators familiar with the unique requirements of burning PRB coal will tell you that it’s not a case of “if” you will have a PRB coal fire, it’s “when.”

In fact, one technical analysis—demonstrating that “PRB represents the extremes of handling problems”—found that:

Spontaneous combustion of coal is a well-known phenomenon, especially with PRB coal. This high-moisture, highly volatile sub-bituminous coal will not only smolder and catch fire while in storage piles at power plants and coal terminals, but has been known to be delivered to a power plant with the rail car or barge partially on fire…

Needless to say, even low intensity fires are potentially troublesome for communities near stockpiles or along rail corridors. Yet it’s hard to evaluate the magnitude of the problem.

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The Facts About Kinder Morgan

In January, Kinder Morgan—a giant energy conglomerate—announced plans to use an Oregon port on the Columbia River to export 30 million tons of coal annually to China and other Asian markets. Many in the Northwest worry about the health risks, pollution, and economic risks that are entailed by the plans. Already tribes and environmental organizations are raising serious concernsabout handling large volumes of coal on the Columbia.

A look at Kinder Morgan’s track record in communities where the company already exports coal reveals that these worries may be well-founded.

Coal dust pollutes the Mississippi River at Kinder Morgan’s coal export terminal in Myrtle Grove, Louisiana.

Many of Kinder Morgan’s coal export operations blight neighborhoods and foul rivers. The company’s track record in the Northwest and beyond is one of pollution, law-breaking, and cover-ups. Moreover, the proposed Oregon terminal would be the company’s biggest yet.

  • In Louisiana, Kinder Morgan’s coal export facilities are so dirty that satellite photos clearly show coal dust pollution spewing into the Mississippi River.
  • In South Carolina, coal dust from Kinder Morgan’s terminal contaminates oysters, pilings, and boats. Locals have even caught the company on video washing coal directly into sensitive waterways.
  • In Virginia, Kinder Morgan’s coal export terminal is an open sore on the neighborhood, coating nearby homes in dust so frequently that even the mayor is speaking out about the problem.

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Do Asian Coal Plants Pollute North America?

When we consider coal export plans, we would do well to consider the risk that by-products of the coal may return to haunt us. In fact, there is a growing body of scientific research examining the ways that smokestack emissions cross oceans to cause pollution problems halfway around the world.

In March, for example, the US National Oceanic and Atmospheric Administration released shocking research findings:

Several recent studies have shown that powerful spring winds can carry Asian pollution into the atmosphere above North America. …some of the imported pollution can descend to the surface, where it affects ground-level ozone, a regulated pollutant. At high concentrations, ground-level ozone can cause severe respiratory effects in some people, and it damages crops, trees, and other vegetation.

“We showed that Asian pollution directly contributes to surface ozone pollution episodes in parts of the western United States,” said Meiyun Lin, Ph.D., lead author of the new study.

In other words, some of the air pollution problems in North America result from the pollution emitted by Asian coal plants and industrial facilities.

NOAA’s findings were not entirely new, however.

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Thoughts On Seeing My First Coal Train

Finally. Despite more than a year of research and writing on coal exports it wasn’t until yesterday that I saw my first loaded coal train. Here it is:

I snapped this photo while standing on Seattle’s Wall Street looking west toward the waterfront. Behind the coal train, you can see the Edgewater Hotel.

My first thought was should I stop breathing? Fortunately, coal dust was not visibly blowing off the tops of the coal cars. Unfortunately, however, the lopsided shape of the coal piles suggested that wind and rain had already taken their withdrawals somewhere along the tracks.

My second thought was: wow, global logistics are amazing. Although I think large-scale coal exports are a bad idea, there’s something undeniably gee-whiz about the path that coal was taking.

The coal almost certainly originated at the Spring Creek Mine, owned and operated by Cloud Peak Energy in southeastern Montana, not far from Sheridan, Wyoming. A few of the 230 workers there mined the coal using a “drag line open-pit” technique, similar to strip mining, that deploys a giant crane-like machine with a bucket for excavations. For a Powder River Basin deposit, the coal in my train was relatively high-energy and therefore relatively valuable. A typical pound of Spring Creek coal will yield an estimated 9,350 BTUs of heat when burned, about 9 percent more than average deposits in the Basin.

At the mine, the coal was loaded into open top hopper-style railcars on a BNSF train. If my train was a typical one, it was at least 100 cars long each of which carried perhaps 110 tons of coal. At the mine, the coal wasn’t worth much. Almost certainly priced at less than $15 per ton, the entire train’s worth of coal was worth less than $200,000 when it was loaded, though it would ultimately sell for much more than that in Asia.

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Dirty-Energy Money

Big Coal and Big Oil know that, in their business, political friends are worth their weight in gold. An academic study of one case of corporate lobbying estimated the return on investment at 22,000 percent: a dollar spent earned $220. Jack Abramoff, the convicted, influence-peddling super-lobbyist, pegged the return on investment of one project at 100,000 percent: $4 million dollars in lobbying cash purchased a $4 billion tax break for Tyco International.

Inspired by paybacks like those, the dirty-energy industry lavishes money on campaigns and lobbying. Not surprisingly, among its favorite sons are Rep. Joe Barton (R-Texas), who famously apologized to BP for Congress’s criticism during the Gulf oil disaster, and Sen. James Inhofe (R-Oklahoma), who insists the science of global warming is a hoax and has likened the US Environmental Protection Agency to the Gestapo. Rep. Barton has raked in $1,914,183 and Sen. Inhofe $1,287,950 from Big Coal and Oil—amounts that bring to mind social critic Upton Sinclair’s observation: “It is difficult to get a man to understand something when his salary depends upon his not understanding it.”

But what about Cascadia, with our hydropower and wind turbines, energy efficiency and smart growth? Does the lucre of Big Coal and Oil taint our delegation to Congress too? We pulled the numbers from the Dirty Energy Money Campaign, which compares recent Congressional votes on a dozen indicative energy policy issues with campaign contributions from fossil energy companies. The answer is unpleasant: even in the Northwest, Big Coal and Oil are dumping train loads of cash on our democracy—almost $5 million since 1999—and the main recipients are hewing to the dirty-energy line. These figures actually understate dirty-energy political money dramatically. They reflect campaign contributions made by energy companies and their key  employees. They ignore contributions made by major investors in these companies and the huge sums of political money that filter to candidates or their election through the bank accounts of lobbyists, PACs, and Super-PACs. Think of these figures as the tip of the iceberg: the visible part but not the most dangerous part.

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Coal Dust in India

Where you find coal, you’re likely to find coal dust. I’ve already cataloged dust problems in Alaska, northern British Columbia, southern British Columbia, Virginia, and Australia. Here’s a look at India.

Before we proceed though, let’s get clear on something: India’s handling of coal is atrocious. It’s far beneath the standards that North American coal handlers employ (and that is not to be intrepreted as praise for North American coal firms). India’s problems do not, therefore, represent a direct comparison to possible Northwest terminals. Nevertheless, India’s experience is important to consider because it is a major market for importing coal.

Although the country has sizeable domestic coal reserves, it is also one of the world’s largest importers—and a much-talked-about destination for shipments from the Northwest. It is concerning then, that India’s ports handle coal so poorly that they do serious damage to nearby communities. In a very real sense then, it is possible that Northwest coal exports would result in even more coal-related damage to India’s public health.

Let’s start with Chennai, on India’s east coast, where coal dust from the port is a constant presence—and one with serious medical consequences:

Gunavathi… A resident of Royapuram and a patient suffering from chronic respiratory problems, she finds coal dust everywhere — in the milk that she boils, on the clothes that she hangs for drying, and on the floors of her house. Residents of Royapuram will soon have to wear masks round-the-clock to protect against coal particles in the air, says MS Ravi, a senior cardiology professor at Government General Hospital, Chennai, who lives in the area.

Medical experts and doctors practising in Royapuram say that they are seeing more cases of respiratory diseases in the area due to exposure to particulate pollution from the coal handling yard at Chennai Port.

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Australia’s Coal Dust Problem

Those concerned about coal dust from export terminals in the Northwest might do well to cast an eye Down Under. Australia is currently the world’s leading coal exporter, and therefore provides an instructive lesson in the ways that transporting and handling of large volumes of coal can affect nearby communities.

Several places in Australia have experienced serious problems with coal dust from railways and export terminals. Here’s how the coal transport industry describes the problem:

Across Australia, dust from trains carrying coal and iron ore is a persistent problem. For residents next to a rail track in the Bowen Basin or Hunter Valley it can, on the worst days, mean dust obscuring windows, dirtying washing and penetrating homes…

And in another article, the same trade journal says:

Ever since trains have been used to transport coal, fugitive dust has been a source of complaints from communities near the rail lines.

Remember, that’s not the perspective of greens or community members. That’s the industry talking.

To be fair, though, that second article also alleges that mitigation measures have reduced coal dust problems by 50 to 90 percent along the particularly dust-plagued route from the Callide region coal mines to Gladstone, a major coal export region on Australia’s east coast.

Yet despite the improvements the shippers claim, coal dust is apparently still a serious problem in Gladstone.

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What Coal Dust Looks Like in Alaska

We’ve already seen how coal dust looks near export terminals at Point Roberts and Prince Rupert, British Columbia. Now let’s take a gander at the export facility at Seward, Alaska.

As a 2010 article in the Anchorage Daily News calls it:

When the north wind blows in Seward, dust flies off a large pile of coal and covers the town’s scenic boat harbor in black grit.

Photos make the problem clear. Courtesy of the good folks at Resurrection Bay Conservation Alliance, here are four photos of coal dust in and around the Seward Harbor.

 

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