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Facing the unknown: Keeping the lights on in Montana's coal country

From the State of Change series
Facing the unknown: Keeping the lights on in Montana's coal country

COLSTRIP, Mont. — It’s not hard to imagine a future for Montana’s coal industry when staring up at a 155-foot wall of a coal pit or watching a 300-ton truck carry the black rock through the Westmoreland Rosebud Mine, a few miles from here.

Industry leaders reckon the Rosebud Mine contains enough recoverable coal for at least another 20 years of mining.

That could mean another 20 years of steady income for miners, power plant employees and their families. Another 20 years of profits for local businesses, money for schools and cash for Montana’s Coal Severance Tax Trust Fund, which pays for countless state services. And another 20 years of sky high rates of carbon emissions from coal-fired power plants.

But the coal industry is too volatile for 20-year predictions.

People don’t agree on the reason behind coal’s decline. Conservationists and some economists argue coal-fired power has become too expensive and is being pushed out by cheap natural gas and renewable energy. They also argue the environmental impact of mining coal, burning it and emitting carbon — a major driver of climate change — is too great a price for continued use.

Industry leaders and those who have been mining for generations argue the playing field is unequal. They argue subsidies give renewable energy an advantage over coal. They also argue coal is too valuable to cast aside because of the economic opportunity it offers and the reliable power it provides.

Regardless, people can agree Montana is unprepared for industry changes brought on by the need to respond to climate change. As two units of the Colstrip Power Plant hurtle toward closure, the parties involved have yet to decide on a path forward. Colstrip and other Montana coal towns are living in uncertain times. It’s not just the uncertainty of what will happen to coal jobs, but how the state and towns will respond and where they’ll get their electricity.

“It’s just excruciating to live and work like that,” said Jim Atchison, executive director of the Colstrip-based nonprofit Southeastern Montana Development Corporation.

Atchison has made it his life’s work to help coal towns. While they wait for decisions to be made, Atchison and his team are working on proactive measures to prepare for further decline in the industry. They are looking for ways towns can diversify investment and develop new jobs, like bringing fiber optic broadband internet to the area, developing outdoor recreation and finding grants for small businesses.

Atchison said he believes coal will continue to be a part of Montana’s future, and that Colstrip’s story “isn’t over by any means.”

Rosebud Mine, Westmoreland Coal Company, Colstrip, Climate

Coal haulers remove coal from a vein about 155 to 190 feet below ground on Aug. 28, 2019, at the Rosebud Mine outside of Colstrip.

The decline

Washington-based Puget Sound Energy and Talen Energy of Pennsylvania own units 1 and 2 of the Colstrip Power Plant. Talen announced in June the units would be permanently retired by the end of 2019.

The retirement has been scheduled since 2016, when the Sierra Club and Montana Environmental Information Center settled a lawsuit filed against the utilities in protest of the plant’s air pollution. The same year, Montana was ranked sixth in the U.S. for carbon emissions per capita by the U.S. Energy Information Administration. The agreement required the two units to shut down no later than 2022.

Units 3 and 4 of the plant remain in operation. Puget Sound and Talen own shares along with Avista Corp., Portland General Electric, PacifiCorp and Northwestern Energy. It’s not clear if these units will live to see 2030 as utilities are feeling pressure to drastically reduce carbon emissions in the coming years.

Avista Corp and Puget Sound Energy are based in Washington and required by their state legislature to forgo coal by 2025. Portland General Electric and PacifiCorp, both based in Oregon, are mandated to leave Montana coal behind by 2035.

The utilities are required by law to make decisions with consensus among all owners. All are preparing for retirement in the next decade except for Northwestern Energy.

John Hines, vice president of supply and government affairs for Northwestern Energy, said the utility is not prepared for coal to go away. He said the company, which provides energy for half of Montana, has worked hard to reduce carbon emissions in its energy portfolio, but it’s still not ready to give up coal.

“It’s not to bury our head in the sand, but we don’t think it’s prudent at all to be shutting Colstrip down in the short term,” Hines said.

Rosebud Mine, Westmoreland Coal Company, Colstrip, Climate

The enormous Colstrip Power Plant sits on the Eastern edge of Colstrip on Aug. 27, 2019. Units 1 and 2 of the plant are scheduled to retire at the end of 2019. The retirement is part of a settlement reached after the Sierra Club and Montana Environmental Information Center filed a lawsuit against the utility in protest of the plant’s carbon emissions.

Northwestern’s electricity procurement plan for 2019 says the state may face energy shortages during critical conditions (like below-zero temperatures) as early as 2021 due to the retirements of the units 1 and 2 in Colstrip and other plants in the region.

Coal is baseload power, meaning it’s more reliable than renewable energy. Coal can generate electricity when wind turbines and solar panels can’t. But technology, like batteries that can store energy created by renewable sources, is getting better.

Northwestern acquired a billion dollars worth of renewable energy resources like hydroelectric dams and wind farms in 2015. Laura Rennick, energy bureau chief for the Montana Department of Environmental Quality, said there are a number of large scale utility projects proposed in the state, and that transitioning away from coal is an ongoing process.

Hines said he’s hopeful the company can help keep the Colstrip Power Plant alive, even if other utilities want to pull out.

Even so, Northwestern is not blind to the decline. At a Montana Board of Regents meeting, the governing body of higher education in the state, leaders talked about what the future of technical training would look like.

Mike Cashell, vice president of transmission at Northwestern Energy, told campus leaders that changes are coming as the energy market shifts, and that it’s going to be challenging.

“It’s not that far away that Colstrip (units) 1 and 2 are shutting down. Colstrip 3 and 4 could shut down within a decade I’d guess, so that coal industry will be almost gone in Montana,” Cashell told campus leaders.

Rosebud Mine, Westmoreland Coal Company, Colstrip, Climate

Dustin Martens, engineering supervisor at the Rosebud Mine, points out the transition from reclaimed land to land currently being mined from a vantage point on Aug. 28, 2019, at the Rosebud Mine outside of Colstrip. In four months the mine spent six to eight million dollars on reclamation.

Way of life

Colstrip is just one town in a region that relies on coal for economic stability. A 2018 study from Headwaters Economics found that many of these places in the West lack adequate plans to address the economic and human impacts of coal industry decline.

Mark Haggerty, an economist for Headwaters Economics, authored the study. He has been writing about the impacts of natural resource extraction for a decade. He said there are few actions that towns and counties can take to prepare for industry decline without direction or policy change at the state level.

The 78-page study uses people’s acceptance of the decline and need to transition as an indicator of resilience. It suggests that “early acceptance of a post-coal future allows more time and resources to employ proactive planning efforts.”

Listen: Dustin Martens on mining

That acceptance is hard won in places where coal keeps the lights on, literally and figuratively.

The Powder River Basin spans Montana and Wyoming and produces some of the cheapest and cleanest coal in the United States. The coal is cleaner because it emits less sulfur than what’s mined in other parts of the country.

According to the U.S. Energy Information Administration, 16 mines in the Powder River Basin produce 43% of the country’s coal. Montana has six of those mines, five coal-fired power plants and nearly one-third of recoverable coal reserves in the U.S.

This resource and the jobs it creates have provided unmatched economic opportunity for coal country in Montana, not to mention the state’s nearly billion dollar coal severance tax trust fund.

In 2018, the Montana Coal Council estimated the six mines combined employed 1,228 people. More than 300 people work at Colstrip’s power plant.

Colstrip Mayor, Climate

Colstrip Mayor John Williams answers questions during an interview on Aug. 28, 2019, at the Colstrip City Court.

If you talk to people who live in Colstrip or Hardin, another town close to a coal mine, they’re proud of the work they do. They provide electricity for Montanans and much of the Pacific Northwest while making a comfortable living.

Colstrip was built for the sole purpose of supporting the industry in 1924, and was later owned by Montana Power. It has since incorporated and grown into a small oasis in eastern Montana.

Green space and trails are abundant, and there’s no shortage of construction happening in this town of 2,300. Tax revenue from the mine and power plant help pay for schools and social services.

Colstrip Mayor John Williams said everyone who lives here is either directly or indirectly connected to coal in some way. A growth policy developed by the city estimates that in the worst case scenario, 233 jobs will be lost when units 1 and 2 shut down. Some of that may come from attrition, but employees could also face layoffs.

The same estimate guesses such a drastic job loss could result in as many as 576 people moving away from here entirely.

“We as a community are totally dependent upon coal and energy development here,” Williams said.

Sidney Fitzpatrick, Hardin, Climate

Sidney Fitzpatrick, a county commissioner for Big Horn County and an enrolled member of the Crow tribe, gestures during an interview on Aug. 27, 2019, in his Hardin office.

Uncertain future

The same is true for Montana’s Crow Reservation.

The Crow Reservation, like Colstrip, is in an isolated part of the state and relies heavily on coal mining. The tribal government gets royalty payments for the mineral rights to the coal, which totaled about $185 million though 2018, according to the Montana Coal Council. On top of that, the reservation makes money off property taxes from the mine and income tax from the workers.

Sidney Fitzpatrick is a county commissioner for Big Horn County, which encompasses the reservation. He’s also an enrolled member of the Crow tribe, and part of the reservation falls within his district.

He said the county is trying to prepare for the possibility of life after coal. Commissioners have looked at implementing a resort tax and investing in renewable energy. But he’s concerned.

“This county relies on coal 100%. If we don’t have coal, we’re in deep trouble,” Fitzpatrick said.

Just a short drive from Hardin is Crow Agency, the headquarters for Crow Nation. It’s also home to Little Big Horn College, where a small group of people are working to create economic opportunity on the reservation.

The Montana Department of Labor and Industry reported in its 2019 Labor Day Report that the unemployment rate on the Crow Reservation was at 14.2% in 2018 — the highest in the state. That’s down from a 17% unemployment rate in 2017, which was caused by coal industry layoffs, the state noted.

John Doyle and Charlene Johnson founded Plenty Doors Community Development Corporation out of desperation to help their community. The nonprofit is focused on growing small businesses and developing tourism, agriculture and renewable energy.

They’ve been busy.

Plenty Doors received a grant to help train people to become plumbers and carpenters — work that’s in demand in town. It pushed marketing and development of the Absalooke Community Market, which is especially important since the only grocery store in Crow Agency burned down last winter. Its next goal is to build a multi-use center in town for entrepreneurs to work in.

“We’re here to benefit as many people as we can,” Johnson said.

But there’s only so much two people can do. And the area is still suffering economically.

Doyle describes the situation as ironic — train cars full of coal making corporations lots of money weave through towns struggling to stay afloat.

“There are millions of dollars going through here, and people can’t afford to pay their bills,” Doyle said.

The high-paid workers in the mines and at the power plant could face similar hardship if coal dies before a safety net is in place.

Listen: Ted Stimac on Colstrip

Ted Stimac, a member of Colstrip’s electrical workers union, predicts that the closure of units 3 and 4 will reduce the town back to the small ranching community it was before the power plant was built. It might have one school and maybe a grocery store, Stimac said.

The longtime Colstrip resident said he knows many of his neighbors don’t share this sentiment. But he feels strongly that it’s time for everyone to see the writing on the wall.

In late August, Stimac looked out the glass door to his back porch and saw construction crews repaving a road leading into his neighborhood.

“As you can see, there’s a huge amount of investment in infrastructure in this community. I feel that’s a total waste, and the reason I say that is because we’re in a temporary town,” Stimac said.

He doesn’t see many options going forward. Stimac completed high school and an apprenticeship and makes $45 an hour at Colstrip’s power plant. He’s going to retire comfortably and move to Hawaii in the next year. He doesn’t see a future like that for today’s coal workers.

“The people here working are doing the best they know how ... We need help, but we don’t even know what to ask for,” Stimac said.

Shaylee Ragar can be reached at sragar@dailychronicle.com or at 406-582-2607. Follow her on Twitter @shay_ragar.

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