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Replacing Coal, part 2: 'Starting now' — a new narrative 'by us, not about us'

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Essential Energy Insights - October 2021


Replacing Coal, part 2: 'Starting now' — a new narrative 'by us, not about us'

This articleis part two in a three-part series stemming from discussions around"Building a Resilient West Virginia," the theme of the recentNational Energy Conference 2016 held in Morgantown, W.Va. and sponsored by theWest Virginia University College of Law. Part one is available .

As coal jobs disappear from places like West Virginia, those charged witheconomic development not only find a revenue and jobs hole where the industryused to be, but also a challenging geography, a workforce reluctant to changetradition and a lack of infrastructure.

Coal is a large, but rapidly shrinking behemoth in the West Virginiaeconomy. According to the West Virginia University Bureau of Business andEconomic Research's 2016 state economic outlook, together, the coal, oil andgas industries account for 4% of state employment but 14% of the state's grossdomestic product. A decade ago, natural gas was responsible for about 12% ofthe level of GDP coal produced in the state, but now they are nearly equal.

"The coal mining industry's severe downturn continuedinto its fourth year in 2015, with widespread job losses and productiondeclines through the beginning of the year," the report noted. " … In2015, we forecast total statewide production will decline by more than 10% toaround 104 million tons. Production is forecast to continue to fall through2016 before bottoming out and beginning to rise again in the latter part of theforecast. The state's southern coal fields will see the greatest losses."

Inside of a few months, the region has seen some of itsbiggest coal companies, including AlphaNatural Resources Inc., Patriot Coal Corp. and all resort to filingfor bankruptcy protection.

The loss of what has historically been the state's primaryeconomic engine was the impetus for focusing on economic transition at theNational Energy Conference, hosted by WVU's John D. Rockefeller IV School ofPolicy and Politics. Sen. Jay Rockefeller, D-W.Va., acknowledged in a briefinterview following a keynote speech at the conference that there may have beenmore that could have been done in the past to prepare for the bust of today'scoal market in West Virginia. 

"Sure, but that's just speculation," Rockefellersaid. "The point is that we're starting now."

A narrative 'by us,not about us'

The Mountain State has frequently found itself stereotypedand a long history with the coal industry is often a part of the caricature ofwhat it means to be West Virginia.

Chuck Fluharty, founder,president and CEO of the Rural Policy Research Institute, said the five stagesof grief that will be needed to move the state forward have not kicked in yet."When you get to acceptance that coal is not coming back, then you areready to do something," Fluharty said.

He said the problem is less an economic issue and more a"psychosocial problem" in that generations have depended on coal foremployment in the region. Fluharty said West Virginia could model efforts onKentucky's bipartisan Shaping Our Appalachian Region, or SOAR, model to createa regional dialogue to inspire hope and gather innovative ideas on movingbeyond coal.

SOAR aims to "expandjob creation, enhance regional opportunity, innovation, and identity, improvethe quality of life, and support all those working to achieve these goals inAppalachian Kentucky." The group is currently preparing to meet inJune for an innovation summit blending the resources of federal partners,funders and supporting organizations interested in boosting Appalachia'seconomic diversity.

"Until we change the narrative, we remain thesame," Fluharty said.

Jeff Whitehead, executivedirector of the Eastern Kentucky Concentrated Employment Program, or EKCEP,said opportunity will not come to Appalachia on its own. He said if people wantto destroy the prevailing notion that you either become a teacher or nurse oryou move away from Appalachia, it must be changed from within the region.

"We need a new narrativeand that narrative needs to be written by us, not about us," Whitehead said."The result of having this single-industry economy is often that theworkforce within that industry gets stereotyped."

EKCEP has several initiativesaimed to help coalfield communities, including Hiring Our Miners Everyday, aneffort that is a collaboration between education, industry and government aimedat finding jobs for laid off coal miners. The program also partnered with twoentrepreneurs to help Bit Source, a Kentucky company, train former coal minersto become computer programmers.

Part of the challenge is thatWest Virginia's geography can make infrastructure expensive and oftenbusinesses may not have access to the services they need. As many careers havemoved online, however, Whitehead said, there is an opportunity to build andtrain a workforce without worrying about the chicken-and-egg sort of challengesthat come with trying to attract a brick-and-mortar institution to an arealacking in a workforce that matches the necessary skills.

"We're not twenty years ago. We're not pre-internet. We'renot pre-technology," Whitehead said. "Our mountains and our ruralareas are no longer a barrier, but an attraction. We can be the next bestinvestment in America."

Whitehead hopes that if there is a workforce available, itcould eventually lead to further investment in the region.

"It's not like we're Chicago where there's a bunch of[information technology] jobs available and all we have to do is fast-trackpeople into training and put them into those jobs," Whitehead said."We're trying to develop the ecosystem as we go."

Kent Spellman, executive director of the West VirginiaCommunity Development Hub, was optimistic about the future of West Virginia ascoal wanes. He said "thank God for this crisis" and said the urgencythat has accompanied it is allowing a conversation that otherwise may not havebeen possible.

Spellman said the challenge is not only getting coal minersto rethink what sorts of jobs they may hold, but also coming up with a socialentrepreneur's approach to economic development. He said the community mustbegin a wholesale revitalization of its art, music and food scene in in orderto attract potential employers to West Virginia.

"A social entrepreneur does not give a man afish," Spellman said. "A social entrepreneur doesn't teach a man tofish. A social entrepreneur reinvents the fishing industry. It's time for us toreinvent out economic development industry."

'We don't recruitextractive industries'

Kelley Goes, a former cabinet secretary for the WestVirginia Department of Commerce, said that West Virginia, on the state level,has been aiming to diversify the economy "a very long time." She saidthat it can be difficult but it is not as difficult as it may look.

She said that the state has primarily been hit hard due itscentralized tax revenue structure that largely depends on severance taxes. Shesaid the state has been actively trying to recruit businesses that are outsideof the extractive industries.

"I personally never went to a coal company and askedthem to mine more coal. … I'm confident that Keith [Burdette] has not been to agas company to ask them to drop more wells," Goes said.

Burdette, the current cabinet secretary at the state's Departmentof Commerce, echoed Goes' sentiment. He said that trying to get attention foran economic development project announced that is outside of the energy sectorin West Virginia "is like being Martin O'Malley in a room full of HillaryClintons."

"We don't recruit extractive industries," he said."The West Virginia Development Office, to my knowledge, has never, everrecruited an extractive industry to the state of West Virginia."

Unfortunately, broad economic diversification will not comein the form of "instant gratification," Burdette noted. Those sittingin hard-hit areas like Logan County, W.Va., he said, are more worried aboutpaying their mortgage and sending their kids off to college immediately ratherthan future economic development efforts. In the meantime, those laid off oftenhave most of their assets tied up in their homes, which have become nearlyimpossible to sell in locations where coal is shutting down and jobs arescarce.

"We're dealing with a population who have, culturally,been able to go underground and make $80,000 a year right out of highschool," Burdette said. "That's not how the system works anymore."

Burdette said bringing even small manufacturers to thoseareas is a formidable challenge as it can be difficult to find as little as 50acres of flat, developable property. Compounding the issue is a lack ofbroadband access and a workforce that on paper does not look good to thoseoutside the mountain state.

Burdette touted a project on Patriot's former Hobet surfacemine site in Boone and Lincoln counties. In his state of the state address,West Virginia Gov. Earl Ray Tomblin announced a 12,000-acre economicdevelopment project on Hobet that would be completed with the help of theVirginia Conservation Legacy FundInc., state universities and other partners.

"When pursuing large-scale projects, our talented teamat the Development Office consistently runs into one major obstacle — a lack offlat land," Tomblin said in his address. "Redeveloped surface minelands offer endless opportunities for residential, commercial and industrialdevelopment and in many cases all three."

Burdette said the Hobet project would be a flexibleindustrial park for potential developments of all sizes. Tomblin noted in hisJanuary address that at least five other southern coal county sites had beenidentified for similar redevelopment efforts.

'Not crying in theirbeer'

Thomas Heywood, president of the Discover the Real WestVirginia Foundation, noted that while the problem is "daunting" hesaid the state should look at coal's decline as an opportunity to build a newfuture with energy and enthusiasm.

"Functionally, the economy that has been there foreveris gone," Heywood said. "You walk in and you might expect people tobe crying in their beer. But people are not crying in their beer.”

The conference featured evidence of some of the potentialHeywood mentioned.

Brandon Dennison, executive director of the CoalfieldDevelopment Corp., is among those who are out in the field looking for newopportunities for a coalfields economy. He told attendees his organization,which among other things builds homes and furniture, is out there creating atransition in a tangible, hands-on way.

"When it comes to this transition thing, no one's goingto do it for us," Dennison said. "We're eager to have investment,we're eager to attract investment to the region, but we know we've got to dothis ourselves from the bottom up. There's no white knight."

Ben Gilmer, president of the Coalfield's social enterpriseRefresh Appalachia, is leading an effort to boost the local agriculturaleconomy in West Virginia that would build wealth and increase access to food.The organization is developing a food distribution and warehouse in WayneCounty, W.Va., supporting efforts to increase agriculture on reclaimed surfacemines and establishing a business incubation service to help build up a localfood economy.

Gilmer said the fact West Virginia spends about $6 billion onfood, but produces less than $1 billion worth of agricultural product meansthere is plenty of opportunity to capture more market share. The program hasprovided investment in high school training programs and even developedreclaimed mine sites.

Glen Wilson and Colt Brogan are both young men from CentralAppalachia who have worked with Coalfields Development Corp.

Brogan said where he was living, there was littleopportunity and he did not know what he would do after high school. He washired by Coalfields a week after graduating and has worked on a number ofprojects he has been proud to bring to Appalachia.

"We're diversifying our options here," Brogan said.

Wilson said he has been able to work on a number ofprojects through Coalfields, including construction, deconstruction, solar,agriculture and woodworking. He said Coalfields brings opportunity to placessuch as empty strip mines that could be used for solar energy.

Though he said he believes coal "is not goinganywhere" and that his coal miner father would admit "coal's goingdown," he said he was excited about potential progress in the coalfieldsthat "can go a hundred directions."