The coal industry is nearing an all-out assault on legislation designed by its friends to speed industrial conversion from oil to coal.
The so-called oil backout bill zipped through the Senate, 86 to 7, June 24, greased by coal state senators led by Majority Leader Robert C. Byrd Jr. It provides $3.6 billion to ease conversion pains for 80 electric utilities in the Northeast and will boost coal demand by an estimated 30 million tons by 1985.
But it took all the persuasion of West Virginia Gov. Jay Rockefeller and several advisers to keep the National Coal Association from denouncing the measure one week later, and the industry may yet break its unhappy silence. t
According to Tony Anthony of the NCA, the Senate version would cost the industry 44 million tons of demand by 1985, leaving a net loss of 14 million tons. The problem is an easing of the 1990 deadline by which gas-burning utilities must switch to coal.
Under an amendment by Sen. J. Bennett Johnston (D-La.), the utilities may continue to burn gas in plants to the end of their useful book life or 1990, whichever is later. "They're building coal-burning plants as fast as they can anyway," said a Johnston aide. "It isn't as though they aren't going to switch. This just allows them a little more flexibility as to when they're going to do it."
The provision, Johnston argued to the Senate, would save gas-burning utility customers $100 billion in interest and debt payments by 1990 in six states: Louisana, Oklahoma, Texas, Kansas, Mississippi and California. Gas, he said, had turned out to be more plentiful than expected and the early conversions would cost moere than the savings in gas.
All the plants will be converted anyway by 1997, so "the coal industry is exaggerating the effect of this," the Johnston aide said.
The more NCA board of directors, meeting at the end of June, looked at the Senate bill, the less they liked it, according to several persons present. tThey were also annoyed that the Senate had cut out President Carter's proposed $6 billion in conversion incentives. They had been aimed at saving 600,000 barrels of oil per day by inducing more plants to switch to coal.
"They wanted to oppose the whole thing," recalled Rockefeller aide Jack Canfield. "It was very tough. They couldn't see the benefit of getting only half a loaf."
Working through the night of June 30, Rockefeller and several industry advisers tried to convince the board that the 86-to-7 vote had been a major victory, that the "off-gas" delay could be lived with and that things might be harder next year.
"There was a definite antienvironmentalist tinge to that vote," Joel Price, a coal analyst for Dean Witter Reynolds Inc. of New York, recalled trying to convince the industry people. "The Senate had beat back more limits on emissions . . . it said they wanted these conversions."
In 1981, environmentalists will mount a major effort to beef up the Clean Air Act and any coal conversion bill will be doubly hard then, Rockefeller argued.
Lecturing the board the next day, Rockefeller warned the members not to oppose the bill. "The cardinal rule, my friends, is never to pick up your marbles and go home," he said. "To say 'no' to th oil backout bill now, on the gamble that the climate for it will improve next year, plays directly into the hands of the environmentalists. And they have beaten you many times."
His candor went further. "You are among the least loved of American industries," he said. "To some extent you have fought mine safety when it was inevitable . . . land reclamation when it was inevitable [and] clean air. Today coal needs all the allies it can get."
The upshot was a statement that day by NCA Chairman R.T. Samples reiterating the coal industry's support for Carter's original proposal and vowing to work for its reconstruction in the House.
"The Senate's provisions could all too easily result in a net decrease in demand for coal," Samples said. "Any [such] bill . . . would not be in the best interests of this country."
The NCA's Anthony said that meant the industry will oppose the Senate version and anything similar that comes out of the House.
But the industry will go it alone. Tom Twomey, political director of the United Mine Workers, said the union supports the Senate measure. "Our basic feeling is that we need the conversion. Phase One is what affects our membership more since we have most of our people on the East Coast."
The mining and Reclamation Council of America, which represents 400 strip-mining operations, also supports the Senate bill, although objecting to the gas provision, press aide Amy J. Hardy said.
The coal conversion begins mark-up this week in the House energy and power subcommittee.