The Obama administration’s decision to stop issuing new coal leases as the federal government’s entire coal program is reviewed makes good business sense.
The moratorium, announced last month by Interior Secretary Sally Jewell, is part of a plan for the Bureau of Land Management to undertake a detailed environmental-impact statement.
Jewell appeared Tuesday before a U.S. Senate Energy and Natural Resources Committee budget hearing to explain the path ahead. Washington U.S. Sen. Maria Cantwell, the senior Democrat on the panel, has long sought a full accounting of the coal industry, and thanked Jewell for her efforts.
About 40 percent of the U.S. coal supply is on public lands. All existing leases will continue, and estimates say that supply could meet about 20 years of demand. The three-year review, plus time to restart the leasing process, will not exceed that supply margin.
The business of taking coal off public land has not had a close look in more than three decades. The leasing price is put at about a $1 per ton, with another $1.50 for royalties. Coal buyers pay 20 to 40 times that amount.
Meanwhile, the expense to society for the cost of massive carbon emissions can run $70 per ton, paying the growing bill for sea-level rise issues and for health impacts like asthma and environmental effects.
Playing fast and loose with commodities on public lands goes back to the grazing and mining interests President Teddy Roosevelt went after. The topic is as fresh as the standoff on the Malheur National Wildlife Refuge in Oregon.
The coal industry has gamed the system for decades.