“The bottom line is that the Paris accord is very unfair at the highest level to the United States. Further, while the current agreement effectively blocks the development of clean coal in America, which it does. And the mines are starting to open up, having a big opening in two weeks, Pennsylvania, Ohio, West Virginia, so many places. A big opening of a brand, new mine. It’s unheard of. For many, many years that hasn’t happened.”
— President Trump, speech announcing U.S. withdrawal from the Paris climate-change agreement, June 1
“Next week we’re opening a big coal mine. You know about that. One in Pennsylvania. It’s actually a new mine. That hadn’t happened in a long time, folks. But we’re putting the people and we’re putting the miners back to work.”
–Trump, remarks in Cincinnati, June 7
Trump’s speech on the Paris accord was filled with misstatements, many of which we fact-checked immediately afterward in a roundup. This particular claim called for a deeper look, especially with the Trump administration’s insistence that coal jobs and mines are coming back. Trump then repeated the claim a week later.
Trump said the Paris agreement is hurting the development of the coal industry in America, where “mines are starting to open up,” and where the agreement is blocking the development of “clean coal.” Is that really the case?
The new mines that are scheduled to open, including in Pennsylvania and West Virginia, are ones that will produce metallurgical coal, which is used to make steel. This coal is used to produce coke, which is then used to blast the furnace to create metal. It’s different from thermal coal, which is burned for steam to produce heat and electricity.
The “big opening” that Trump is referring to is the Corsa Coal Company’s Acosta Deep Mine in Jennerstown, Pa. Corsa began work on this mine in September — two months before the presidential election. This mine is expected to create 70 to 100 full-time jobs, according to the company.
Several factors led to newfound optimism for metallurgical coal production among U.S. coal companies.
While the domestic market has remained relatively flat, international market demands — particularly the building boom in China — have sustained the metallurgical coal industry in the United States in recent years. The average price of metallurgical exports ticked up at the end of 2016.
The increased demand for steel and metallurgical coal from China has raised prices worldwide. U.S. coal companies are now emerging from bankruptcy, and some of them are going public with new investors. And the United States now has a coal-friendly administration, with a president looking to push for an infrastructure deal that could increase the domestic demand for steel.
And earlier this year, Cyclone Debbie damaged the supply chains in Australia, the world’s largest exporter of metallurgical coal. That left China, the world’s biggest producer of steel and largest importer of metallurgical coal, scrambling for new sources — including the United States. (Interestingly: The Australian Bureau of Meteorology attributed the threat of more frequent and intense cyclones to climate change, according to the Daily Beast.)
What do these metallurgical mines have to do with the Paris accord? “Not a whole lot, except that the politics get mixed in. The Paris agreement was actually working more aggressively to curtail thermal coal use for the coal plants. There is some concern about metallurgical coal, but not much. But the coal trade itself is a huge part of the Paris agreement,” said Tom Sanzillo, director of finance at the Institute for Energy Economics & Financial Analysis, which is supported by liberal philanthropies.
All carbon emissions, including emissions from metallurgical coal, contribute to climate change. But the Paris agreement focuses on thermal coal, because electricity production can be changed without affecting economic growth. Therefore, it’s a more feasible area for change than trying to find any substitutes for using coal to make steel.
The White House did not respond to our request for comment.
The rebound in metallurgical coal demand doesn’t signal a long-term coal renaissance, analysts say. For one thing, the long-term projection of metallurgical coal exports by the United States through 2050 remains flat. And metallurgical coal production makes up less than 10 percent of U.S. production, according to E&E News.
Before the slight uptick in early 2017, U.S. coal jobs and production in 2016 fell to the lowest level in four decades. The demand for electricity-producing coal continues to decline, while natural gas is becoming cheaper and easier to produce, thanks to the fracking boom. In fact, Gary Cohn, chairman of Trump’s National Economic Council, recently acknowledged that “coal doesn’t even make that much sense anymore as a feedstock” due to the rise of natural gas. (For more, read our colleague Steven Mufson’s great article on the industry’s challenges for achieving long-term profitability.)
Trump said the Paris agreement “effectively blocks the development of clean coal in America,” but the nonbinding, voluntary agreement allows each country to decide the method and technology it wants to use to curb carbon emissions. “Clean coal” is rhetoric often used to describe carbon capture and storage, a technique to capture carbon emissions from power plants, transport it through pipelines and inject it deep into the ground to make oil wells more productive.
Since the United States signed on to the Paris agreement in 2015, this technology has continued to develop in the United States. But it remains expensive and not viable economically without being linked to an enhanced oil recovery project. The first large-scale “clean coal” facility was declared operational in January in Texas. A second coal plant in Mississippi using carbon-capture technology was expected to open the same month, but was delayed and has not yet opened. Meanwhile, Trump’s budget proposal would shrink funding for research on carbon capture and carbon storage technology.
The Pinocchio Test
Trump’s characterization about new mines and “clean carbon” technology, both in the context of the Paris agreement, is misleading.
He referred to new mines opening up, but the projects he referred to are for a specific type of coal that is used to produce steel, not electricity. The Paris deal focuses on carbon emissions from electricity-generating coal, not metallurgical coal. Demands in metallurgical coal aren’t affected by the Paris agreement or U.S. federal policies; international market prices and fluctuations have led to the recent increased demand. Moreover, the specific factory he refers to had plans to open since September, two months before the election.
The agreement also does not block the development of “clean coal.” In fact, since the United States signed on to the Paris agreement, the first large-scale “clean coal” facility opened in 2017, and plans are underway for a second one.
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