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Could a former coal town in Washington State provide a model for Appalachia’s energy transition?
In 2011, Centralia, Washington was struggling to deal with a shuttered coal mine, the looming retirement of a coal-fired power plant, and the loss of more than 900 jobs. Senior Researcher Sean O’Leary explains how, since the introduction of an innovative grant program centered around clean energy, energy efficiency, and education, Centralia, Washington’s economic output as measured by GDP ballooned to twice the national average.
Across Appalachia, increasingly cost-effective renewables, impending federal subsidies, and a growing public appetite are hastening an energy transition with vast economic potential. In West Virginia, a flurry of solar development projects are poised to increase the state’s renewable energy generation by nearly 200-Megawatts in just a few years. Senior Researcher Ted Boettner and Solar United Neighbors Regional Field Director Autumn Long describe how an influx of federal dollars from the American Jobs Plan could catapult the region to the fore of clean energy development and ensure oil and gas workers are supported through the transition away from fossil fuels.
Meanwhile, national coverage of recent ORVI research outlines how federal programs to address the region’s glut of abandoned mine lands and orphan oil and gas wells could create thousands of well-paying jobs each year while mitigating climate-warming methane emissions.
As environmental advocate George Banziger, Ph.D. writes in the Parkersburg News and Sentinel, “it’s time to reimagine Appalachia.”
Stick around for our weekly reading list, featuring a first-of-its-kind report from the International Energy Agency, analyses of the economic hurdles facing natural gas, and what could be the start of a rural anti-fracking coalition.
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A solar boom is on the horizon in West Virginia, where state lawmakers have recently opened doors for solar installations and utility solar programs and a flurry of multi-million-dollar public and private solar projects are under development. A number of federal policy proposals at the federal level could catapult the Mountain State even further ahead in the solar development game.
President Biden’s American Jobs Plan includes two key provisions that could vastly expand solar energy generation in the U.S., Senior Researcher Ted Boettner and Solar United Neighbors Regional Field Director Autumn Long write. The first is a 10-year extension of the federal solar Investment Tax Credit (ITC), which currently offers a 26% tax credit for solar installations. The second is an expanded direct cash payment in lieu of the ITC that allows solar owners to receive money even if they don’t have taxable income, much like a refundable tax credit. This cash grant option would ensure equitable benefits of the ITC are accessible to low- and moderate-income households, people with low tax liability, and nonprofit institutions such as schools, churches, local governments, and rural electric cooperatives.
Investments in solar energy could create hundreds of well-paying jobs while slashing climate-warming CO2 emissions. A recent report from the Political Economy Research Institute (PERI) at UMASS-Amherst exploring a policy blueprint from the Reimagine Appalachia campaign found that, for West Virginia to cut its CO2 emissions in half by 2030, it could require a $3.9 billion investment in solar generation capacity over the next 10 years, or $390 million per year. The report finds that this investment of public and private dollars would create 585 direct and 195 indirect solar jobs in West Virginia (totaling 1,053 if you include direct, indirect, and induced jobs) every year for the next 10 years.
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And an October 2020 report by E2 found that jobs in solar pay close to what jobs in the coal, oil, and gas industries pay, $24.48 an hour (median) compared to $24.37 an hour (median), respectively. Approximately 10 percent of solar industry jobs are unionized, according to the Solar Foundation, which is above the national average and similar to levels found throughout the construction industry.
Federal support is crucial to successfully build and implement the local workforce training programs needed to swiftly grow the nation’s solar workforce while ensuring that underrepresented groups and communities gain employment and start businesses in the solar energy sector. Moreover, by investing in federal procurement of domestically manufactured clean energy goods and materials, the Biden administration can spur domestic supply chains and support the development of a domestic manufacturing sector for solar and electric vehicle (EV) components, including batteries and other critical clean energy technologies.
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The recent announcement of new solar projects in West Virginia, coupled with federal proposals to boost solar investment, could more than double the number of workers in West Virginia’s solar industry and help diversify the state’s energy mix and economy, Long and Boettner write. Now, “all we have to do is make it happen.”
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For the many Appalachian workers and communities who’ve built their livelihoods around coal, oil, and natural gas extraction, the documented inability of the fossil fuel and petrochemical industries to serve as engines for job growth and prosperity “can give rise to a question that is equal parts a challenge and a plea,” Senior Researcher Sean O’Leary writes. “What’s the alternative?”
It’s a question that guided O’Leary’s recent testimony before the West Virginia Public Service Commission regarding the economic impacts of the possible 2028 retirement of the Mitchell coal-fired power plant near Moundsville, WV. Economically, the plant has been struggling, operating at only 37% of capacity and reliant on ratepayer subsidies for survival. Yet the plant continues to support more than 660 total jobs.
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But today, Centralia’s economy is booming. As part of the 2011 plant closure agreement, the town negotiated a $55 million coal transition fund that consists of three component funds:
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A “Weatherization Fund” that supports energy efficiency upgrades for low and moderate-income residents
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An “Economic & Community Development Fund” that supports workers, families, businesses, and organizations to expand education, retraining, and general economic development
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An “Energy Technology Fund” that supports clean energy generation, energy efficiency, storage, and transportation electrification
Between 2015, just before the fund was administered, and 2019, Centralia’s economic output as measured by gross domestic product grew at twice the rate of US GDP. Job and population growth ballooned.
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O’Leary attributes the striking turnaround to the calculated investments made by the transition fund board in clean energy, energy efficiency, and education, which are highly labor intensive relative to utilities and extractive industries. Work in these industries tends to be performed by local suppliers, keeping money and the economic impacts in the local community. The grants program is highly efficient, too, because it leverages existing business and programs rather than diverting lots of money to expensive one-time set-up costs. It has also lowered monthly utility bills, putting more money in the pockets of local residents. Finally, O’Leary writes, the energy efficiency upgrades being made in Centralia result in changes that have been shown elsewhere to produce safer, more comfortable living and workspaces that reduce absenteeism and healthcare costs and enhance the quality of life.
What could the Centralia case mean for the Ohio River Valley? Read O’Leary’s full analysis here. Click below to forward or share this article on social media.
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ORVI Senior Researcher Sean O’Leary was a programmable calculator salesman when computers revolutionized the office workspace, wiping out the hundreds of thousands of jobs tied to the production and sale of yesteryear’s analog office machines. Curiously, digitization and the mass economic transition it heralded never prompted a widespread discussion of jobs lost, of economic benefits or assistance to displaced workers and communities.
Fast-forward to present-day America and “jobs” is the principal currency of public economic discourse. How do we create more of them? How do we mitigate the risk of losing them? These questions have shaped conversations around energy transition in the Ohio River Valley. But for all the airtime they’ve received, there is relatively little strategy in place to deal with the coming energy economy transition in the region.
Fossil fuel industry leaders spout hollow rhetoric about job preservation to justify tax breaks and regulatory leniency, all the while inflating executive compensation and investing in new, pollutive technologies that eliminate, rather than create, jobs. And on the left, occasionally vague statements about the job creation potential of clean energy leave communities facing transition with little to grasp.
Even more perplexing is the political necessity of conjuring up special solutions for a
“numerically tiny subset of fossil fuel workers who’ve enjoyed the highest paying blue-collar jobs for decades” at the expense of conversation about the “many other workers have done far less well, are equally at risk, and yet no one is proposing special assistance programs for them.”
Talking heads on both sides of the issue should shed their political lenses and revisit the issue of jobs and energy transition from a place of compassion and simple, unbiased economics, O’Leary concludes. It’s time to get to work.
“It’s good that we now talk about jobs and equitable transition, but we need to get serious about what that means — the strategies, the resources, and the outcomes — and how we’re going to bring them about.”
Read the full blog post here.
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Climate Changemakers Fighting for Environmental Justice: “This Is What Transfomation Is About” (CBS News)
Fourth-generation coal miner Scott Shoupe started working in the mines back in the 1990s, when coal from his native Kentucky and greater Appalachia still made up the lion’s share of electricity production in the U.S. But the advent of Appalachian fracking and natural gas production around 2010 left coal—and coal jobs—by the wayside. “When they walk in here like they did at the end of 2012, and shut down every operation in the area, it kinda gives you a realization that something’s gonna change,” Shoupe said. In 2018, he left the coal industry to register for a federally funded just transition program that trained coal miners to transfer their skills to jobs in green energy. Large-scale federal funding could help communities like Shoupe’s create jobs for workers and families displaced by the energy transition. Recent ORVI research points to the 15,151 jobs per year that could be created by a federal program to plug hazardous abandoned oil and gas wells across Kentucky, Ohio, Pennsylvania, and West Virginia. Today, Shoupe owns his own renewable energy installation business. “We’ve always been a world provider in energy. And we can still do that,” he said. “We just gotta progress with the times, you know?” |
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Opinion: West Virginia Needs American Jobs Plan (Charleston Gazette-Mail)
If approved by Congress, the American Jobs Plan would direct more than $20 billion over eight years to West Virginia, “creating thousands of jobs to rebuild our roads and bridges, modernize our power lines, boost manufacturing and clean up the damage to our land from mining and drilling,” ORVI Senior Researcher Ted Boettner writes. The state’s long history of extraction has left tens of thousands of hazardous abandoned oil and gas wells and billions of dollars of coal mining damage that could be remedied with federal dollars, mitigating climate impacts and replacing lost coal jobs in the process. “Repairing the damage of the past provides a unique opportunity to get West Virginia fossil fuel workers working again,” according to Boettner. “All of us in West Virginia deserve an opportunity to pursue the American dream—a dream that has been receding for too many of us over the past several decades—and right now, the American Jobs Plan provides that opportunity.” |
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Economic value of Mitchell coal-fired power plant to Marshall County under scrutiny as hearings approach (Charleston Gazette-Mail)
The 50-year-old Mitchell coal-fired power plant near Moundsville, WV, has reached a crossroads as coal-fueled power generation faces an uphill climb to meet impending environmental compliance regulations. According to Senior Researcher Sean O’Leary, “the best economic course of action for Marshall County would be for American Electric Power to forgo environmental compliance work at Mitchell facility, allow it to retire in 2028 and invest part of the savings in an economic transition plan rather than spend on a plant whose production and employment is likely to decline as average monthly bills increase.” O’Leary points to the $55 million economic transition plan instituted in 2016 in the former coal town of Centralia, Washington as an example of a successful energy transition. Between 2015, just before funding activity started, and 2019, the town’s GDP doubled the national average and job and population growth boomed. |
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Opinion: It’s Time for Us to Reimagine Appalachia (Parkersburg News and Sentinel)
George Banziger, Ph.D., a former faculty member at Marietta College and current environmental advocate with Mid-Ohio Valley Climate Action, argues that well-paying Appalachian jobs don’t have to come at the expense of public health and the environment: “There are good jobs in a reimagined Appalachia,” he writes, “such as those involved with capping abandoned oil and gas wells, modernizing the electricity grid, redesigning buildings and industry for energy efficiency, regenerative agriculture, clean and efficient manufacturing, a sustainable transportation system, energy storage, repurposing coal-fired power plants, and creating pathways and training programs for low-wage workers.” Banziger notes that the shale gas boom supercharged economic output in the region without providing any corresponding increase in measures of economic prosperity for local communities. A new, innovative, diversified economy could provide reliable local jobs with good wages and benefits and reduce greenhouse gas emissions. “That should serve as a compelling model for our region of Appalachia,” Banziger writes. |
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Biden Connects Climate to Jobs as Coal Miners Hold Out for Results (The Energy Mix)
In his first address to a joint session of Congress, Biden reasserted his administration’s view that addressing the climate crisis is an opportunity for job creation. The United Mine Workers of America has expressed support for Biden’s infrastructure plan on the condition that it includes a comprehensive transition strategy for coal communities in places like the Ohio River Valley. “We can’t move forward with a clean energy economy without coal miners and coal communities,” said Senior Researcher Ted Boettner. “The UMWA knows that better than anyone. Their plan to preserve coal country is a huge step forward to ensuring that no worker is left behind and that smart federal investments and policies can provide a solid foundation for working families and coal impacted areas.” |
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Why Are Abandoned Wells Such a Problem in Pennsylvania? (The Keystone)
Orphaned and abandoned oil and gas wells “can potentially leak methane gas into the air, soil, and groundwater. Fixing that problem could mean more jobs for Pennsylvanians,” Ashley Adams writes. According to ORVI data, a robust, federally funded well-plugging program could create nearly 4,000 jobs per year over 20 years in Pennsylvania. About 20 percent of Pennsylvania’s 200,000 estimated abandoned wells leak methane, a potent and hazardous greenhouse gas, according to Seth Pelepko, an environmental program manager for the Bureau of Oil & Gas Planning and Program Management at the Pennsylvania Department of Environmental Protection. |
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Report: $126M Price Tag for Cleaning Up Tennessee’s Abandoned Coal Fields (Tennessee Lookout)
Tennessee has more than 14,000 acres of abandoned coal fields—more than 75,000 Tennesseeans live within a mile of an abandoned mine—but the costs of remediation far outweigh the federal funding available to the state, according to ORVI data. While Tennessee receives about $3 million in reclamation funds per year from the U.S. Department of Interior’s Office of Surface Mining, it’s a proverbial drop in the bucket relative to the $126 million sum Research Fellow Eric Dixon estimates is necessary to clean up the Volunteer State’s known abandoned mine lands. According to Anita Wadhwani, Tennessee’s flagging coal industry has meant less state revenue allocatable to remediation dollars. “During Fiscal Year 2018, just five mines produced coal in Tennessee,” she writes. |
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What We’re Reading at ORVI
Increasingly cost-effective renewables, impending federal subsidies, a growing public appetite, and a landmark report from the International Energy Agency are hastening a national energy transition. Here’s the latest:
- Nations Must Drop Fossil Fuels, Fast, World Energy Body Warns (New York Times) A first-of-its-kind report from the International Energy Agency (IEA), an influential energy policy advisor, outlines a course for countries to quickly and aggressively cut planet-warming pollution, including an immediate halt to new coal-fired power plants and new oil and gas fields. “It’s a huge shift in messaging if they’re saying there’s no need to invest in new fossil fuel supply,” Kelly Trout, senior research analyst at environmental advocacy group Oil Change International, told The New York Times. According to IEA executive director Fatih Birol, “The sheer magnitude of changes needed to get to net zero emissions by 2050 is still not fully understood by many governments and investors.”
- Rebuilding the Economy: A Manufacturing Plan for America (BlueGreen Alliance) Getting people back to work is at the top of the Industrial Midwest’s priority list, according to a new survey from BlueGreen Alliance that asked voters to rank their three most important goals for investing in jobs and economic recovery. Nine in ten (90%) respondents said the U.S. should prioritize repairing and modernizing the country’s aging physical infrastructure and rebuilding and retooling American manufacturing to build more products and technology domestically. Nearly three-quarters (72%) of respondents want to prioritize increasing the production of clean energy. Investing in innovative clean technologies was widely supported.
- U.S. Natural Gas Generation in 2021 Sees its First Year-Over-Year Decline in Three Years (U.S. Energy Information Administration) Natural gas-fired generation has been facing increased competition from renewable generation in the United States because of recent record-high capacity additions to wind and solar power plants. The decline in natural gas generation during the first four months of this year is the result of higher natural gas prices and increased competition from renewables, and it is the first year-over-year decline since 2017.
- This Could Be the Start of a Rural Anti-Fracking Coalition (New Republic) Landowners who lease their land to gas companies aren’t always pleased with the results. “They don’t tell me anything,” said George Hagemeyer, a fracking lessor in Trout Run, PA. “They want you to think you don’t have any rights.” If anti-fracking activists “articulated policies that harmonized with what people like George (white, land-owning, frequently leaning conservative) see as “rural values” (like the libertarian principle that one’s home is one’s castle and a belief in highly localized community control over anything that might affect that castle),” they could broaden their tent dramatically, Colin Jerolmack asserts.
- The Dam Has Broken and West Virginia Has Awoken to Solar Power (Forbes) The coal industry’s tight grip on West Virginia is loosening as solar energy becomes an increasingly cost-effective option. In anticipation of the Biden administration’s major investments in clean energy, corporations and constituents are putting pressure on state policymakers to pave the way for renewable industry, and national developers are buying up reclaimed coal mine sites intended to put large-scale solar farms in their stead. “Consider the case of Nitro Construction Services,” Ken Silverstein writes, “which provides commercial and industrial businesses with electrical, mechanical, and technological services: the company is rooted in the coal industry but it is now ramping up its solar business.”
Pittsburgh is Losing Black Residents. One Entrepreneur Is Trying to Bring Them Back. (Wall Street Journal) After years of population loss, the former steel town has been reborn as one of America’s most livable cities. But while its white population has stabilized, it continues to lose Black residents at a faster clip than other major cities. David Motley, a Black venture capitalist, is trying to change that, namely by bringing more Black professionals to Pittsburgh, now a burgeoning center for technology, business and education.
- World’s Largest Long-Haul Truckmaker Sees Hydrogen-Fueled Future (The New York Times) Daimler, the world’s largest maker of heavy trucks, recently announced it would convert to zero-emission vehicles within 15 years at the latest. But curbing emissions for long-haul trucks is more complicated than electrifying passenger cars. Heavy, space-consuming batteries aren’t ideal for payload-maximizing 18-wheelers. Instead, Daimler and some rivals are betting on fuel cells that generate electricity from hydrogen.
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Natural Gas, America’s Number 1 Power Source, Already Has a New Challenger: Batteries (Wall Street Journal) A decade ago, the fracking boom boosted natural gas over coal as America’s top electric-power source. Now, in quick succession, the natural gas industry finds itself threatened with the same kind of disruption, only this time from cost-effective batteries charged with wind and solar energy. The storage capacity of batteries paired with inexpensive renewable energy is threatening to upend billions of dollars in natural-gas investments, raising concerns about whether power plants built in the past 10 years—financed with the expectation that they would run for decades—will become “stranded assets,” facilities that retire before they pay for themselves.
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Appalachian Coal Is a Major Source of Methane, a Potent Greenhouse Gas (Ohio Valley ReSource) More than one million tons of methane, a potent greenhouse gas, were emitted from Appalachian coal mines in 2019, according to a report from Kayrros, a company focused on climate risk. The region spewed 3 million tons of methane in total. Methane, which has approximately 84 times the warming potential of carbon dioxide, accounts for 30% of warming since the pre-industrial era, according to the UN.
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