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Obama Halts New Coal Mining Leases on Federal Lands

The moratorium comes amidst a string of major coal company bankruptcy filings and increasing federal regulation of fossil fuel emissions.
Photo by Matthew Brown/AP

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The Obama administration announced Friday a temporary freeze, effective immediately, on new coal leases on federal land, the latest in a string of efforts to address climate change and transform the American energy sector.

The US Department of Interior will conduct for the first time in 30 years a review of its policies for leasing federal lands to coal companies.


"We have an obligation to current and future generations to ensure the federal coal program delivers a fair return to American taxpayers and takes into account its impacts on climate change," Interior Secretary Sally Jewell told reporters during a Friday conference call.

Jewell made clear that the pause would not immediately have "any impact whatsoever on coal production," noting the industry has enough coal in-hand to satisfy America's demand for the next 20 years. The United States produces just under 1 billion tons of coal per year, according to the Energy Information Administration — the lowest level since 1986.

The review comes days after Obama telegraphed the move in his State of the Union speech, when he told the nation he would "push to change the way we manage our oil and coal resources, so that they better reflect the costs they impose on taxpayers and our planet."

It's the latest effort to satisfy the president's Clean Power Plan, which requires a 32 percent reduction in US carbon emissions from 2005 levels by 2030. Republicans and some coal state Democrats fiercely oppose the plan.

30+ years since last coal program review. It's time to reform it & strengthen to meet energy, climate priorities. SJ

— Sally Jewell (@SecretaryJewell) January 15, 2016

The moratorium is the latest bit of bad news in what is a very rough patch for the coal industry, which has seen companies drop like flies. On Monday, Arch Coal, the second largest coal producer in the United States, became the fourth major coal company since July to file for bankruptcy, and the 50th American coal company to do so since 2012.


The review — officially called a Programmatic Environmental Impact Statement — allows the Interior Department to broadly examine the federal coal leasing program and to incorporate new environmental, health, and financial impacts. The current coal program charges a 12.5 percent royalty rate on surface-mined coal and 8 percent on coal mined underground, the lowest rate legally allowed.

Environmentalists have long argued that the rate is too low and taxpayers are being cheated, and they praised the administration's Friday move.

"For decades, coal companies have ripped 400 million tons of coal from our public lands every year, burning it in power plants, slowing clean energy development, hastening climate disruption, and polluting our communities," said Sierra Club Executive Director Michael Brune. "In reforming the federal coal leasing program and accounting for the full cost of coal on our health and our climate, President Obama and Secretary Jewell are saying that the American people no longer have to pay for this outdated, dysfunctional, and destructive program with their health or their wallets."

Related: The Twilight of the American Coal Industry May Be Nigh

The move prompted fresh criticisms of the president's "war on coal" from Karen Harbert, president and CEO of the US Chamber of Commerce Institute for 21st Century Energy, who called the move "a foolish crusade".

Senator John Barrasso (R-Wyo.) echoed those concerns, saying in a statement that the administration is engaged "in a full-scale war with coal communities and families."


Congressman Rob Bishop, (R-UT), who chairs the House Natural Resources Committee, dismissed Obama's previous calls for an "all-of-the-above" energy strategy as an "election-year lie."

"Unfortunately, the president's bid to solidify his legacy with the extreme left will come at the expense of America's energy needs and will make the lives of people more expensive and more uncomfortable," Bishop said in a statement.

If the review leads to lasting policy change, it could enable drastic greenhouse gas emissions cuts. Last year, a study by the Center for Biological Diversity and Friends of the Earth found that banning new fossil fuel leases on public lands and oceans would keep upwards of 450 billion tons of planet-warming carbon pollution out of the atmosphere — about the same amount of pollution generated by 118,000 coal-fired power plants.

Randi Spivak, public lands director for the Center for Biological Diversity, said the review was an important step. But she stressed that "it can't end here," and called for a permanent ban on new coal leases for coal, oil and gas.

"Every ton of coal, every drop of oil that comes out of our public lands will be burned and worsen climate change - setting the state for more heat waves, freak storms, rising seas and droughts," Spivak said. "The Obama administration is moving in the right direction with this coal decision but we'll need more action and soon."

Follow Darren Ankrom on Twitter: @darrenankrom