"Wyoming's coal industry is under siege," Wyoming Gov. Mark Gordon, a Republican, warned lawmakers ahead of the state government's 2020 legislative session.
While Wyoming legislators may not be able to control market forces suppressing coal demand, Gordon said they could influence the marketability of the fuel with favorable policies. The governor called for resisting out-of-state pressures to close coal-fired units early and promoting carbon capture technologies to allow companies to burn coal while emitting less carbon dioxide.
"These are hard times for one of our most stalwart industries, and unfortunately, times do not look better for the industry anytime soon," Gordon wrote in a Jan. 13 letter to lawmakers.
Gordon suggested the inclusion of $1 million in the state's 2021 budget for coal market augmentation and preservation. The program would be used to defend the industry to protect the revenues it provides for the state and could also support local communities, he wrote.
The governor also urged passage of legislation that would establish a coal marketing program with a minimum of $1 million in funding for his office to support the program.
In a separate letter, Gordon called for more development of technologies to advance zero- or negative-carbon uses for coal. He offered support for an effort by the state's Joint Minerals Committee to develop an energy commercialization program and requested it to be funded with $25 million to advance coal technology.
"Forty years ago, wind and solar seemed like far-fetched technologies," Gordon wrote. "Government subsidies over the past few years, including research and development, brought on the rapid buildout of these technologies to where they are quite competitive with traditional technologies."
There are valuable lessons to be learned from that shift, Gordon said. The Powder River Basin coal mining region focused in Wyoming is struggling. The area produces thermal coal for power generation, and its producers struggle with weakened demand due to lower natural gas prices to the point that several filed for bankruptcy restructurings in recent years.
Power generators continue to announce new coal-fired power plant retirements, further pressuring coal producers. Moody's Investors Service predicted in October 2019 that "at least a few" mines are likely to close in the region as domestic demand drops. The governor noted in his letter that coal production in the state was falling rapidly.
"Wyoming must deploy a strategy to slow and ideally reverse this trend," Gordon said. "It is not only imperative for our state's economy but is the appropriate and correct thing to do for our state's other resources as well."
The Wyoming legislative session is scheduled to convene a joint session on Feb. 10.