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New coal rules blasted by governor, delegation

Sep 22, 2013 - By Ben Neary and Mead Gruver, AP

CHEYENNE (AP) -- Wyoming Gov. Matt Mead and members of the state's congressional delegation reacted quickly on Friday to new U.S. Environmental Protection Agency rules to limit carbon emissions from future coal-fired power plants, saying they would cripple the coal industry as well as clean-coal research.

Meanwhile, some environmental groups point to recent unsuccessful efforts by the federal government to lease new coal tracts in Wyoming's Powder River Basin as proof the nation needs to re-examine its policies for selling public coal reserves.

The EPA on Friday announced the first national limits on carbon pollution from future power plants. The agency also is developing tougher standards on existing plants as part of the Obama administration's push to address global warming.

Wyoming is the nation's top coal-producing state and draws nearly $1 billion a year from its share of the proceeds from coal production on federal lands.

"This latest EPA proposal would be damaging to Wyoming, the nation's top coal supplier," Mead said Friday. "The standards for coal-fired power generation in the proposed rule are unachievable and will arrest research, development and commercialization of clean technologies."

EPA administrator Gina McCarthy said Friday the proposed regulations aren't intended to damage the coal industry but would help the industry to adapt by encouraging companies to develop ways to reduce carbon emissions from burning coal.

Wyoming Republican Sens. Mike Enzi and John Barrasso are pushing to give Congress, not the EPA, final say over energy regulations. They and Rep. Cynthia Lummis, R-Wyo., issued a joint statement critical of the new rule.

"Our energy sector is too important to leave its fate to a few Washington bureaucrats and a president who obviously has a bias against energy that comes out of the ground," Enzi said in the statement. "If you can make it too expensive to open a new power plant, you effectively put a stop to coal use in this country. That's the president's plan and he's moving forward with it."

Marion Loomis, executive director of the Wyoming Mining Association, said the new rule will have a greater impact in the future as utilities consider the economics of future plant construction.

"It's clear that they're doing everything they can to move the country away from coal," Loomis said. "They want to kill the coal industry. I don't think that's going to happen."

Loomis said he expects coal will remain one of the primary sources of electricity in the country.

The new EPA rules came down two days after the U.S. Bureau of Land Management in Wyoming rejected the only bid for 167 million tons of federal coal next to the Kiewit Mining Properties, Inc., Buckskin Mine in the northern Powder River Basin.

Kiewit bid 21 cents per mineable ton for the Hay Creek II coal tract. The rejection followed a BLM sale of Powder River Basin coal last month which, for the first time in history, drew no bids.

Environmentalists jumped on Wednesday's rare bid rejection as further evidence that BLM should heed their call for a moratorium on federal coal sales.

after a recent inspector general report found that undervalued coal sales have cost the federal government $62 billion in revenue.

"They keep trying to sell the coal, but industry either doesn't want it or isn't willing to pay the American public what it deserves," Jeremy Nichols with WildEarth Guardians said by email.

While the 21-cent-per-ton bid was unusually low, the coal was of unusually low quality.

The Hay Creek II coal, at around 8,300 Btu, was the lowest-Btu coal offered for sale from the basin in more than 20 years. How deeply the coal is buried and the cost to mine it also factors into the BLM's estimate of fair market value for basin coal, BLM spokeswoman Beverly Gorny said.

"There's many, many things that go into that assessment. It isn't a one-sized fits all number. It's individualized to each tract that's nominated," she said.

Just how much Kiewit bid under the government's valuation of its coal isn't publicly known because the BLM keeps its coal value assessments a secret.

In any case, Kiewit began the process of acquiring the coal several years ago. The company applied with the BLM to mine the coal back in 2006.

"The marketplace has changed somewhat. The economy has changed. I'm sure that Kiewit made the best bid they could," Loomis said.

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