Coal's Role in the Local & State Economy

March 17, 2015

Coal has a long history of driving Pennsylvania’s economy. In 2014, the Pennsylvania Coal Alliance worked with the Pennsylvania Economy League of Greater Pittsburgh to release a report detailing the multibillion dollar economic impact that coal has statewide. This past March, we released a new report highlighting Greene and Washington Counties to illustrate that data on the local level.


Greene and Washington Counties are among the top coal-producing counties in the state with ​​Pennsylvania ranking fourth nationally in coal production.  Longwall mining is a very specific type of underground mining used to extract coal and it takes place only in Greene and Washington Counties. It produces 33,733,448 of the 57,967,127 tons – or 58 percent -- of the bituminous coal mined in the state every year and ranks Greene County as the third highest coal-producing county in the nation.

  

Because of vast role mining plays in both the local and state economies, elected officials have worked with the industry to sustain the positive impacts. Upon reading the report, Senator Bartolotta (R-46) said, “Longwall mining helps to power the economy of my Senatorial District accounting for over 13 percent of the GDP of Greene and Washington Counties. Its product – coal -- provides all Pennsylvanians with an assurance that the Commonwealth will continue to have an affordable and reliable source of electricity.”

 

The longwall mining industry contributes $1.94 billion to the county’s economies; $535 million in labor income, $1.3 billion in property income, and more than $81 million in indirect business taxes to Washington and Greene Counties.

“The history of Greene and Washington Counties is built on coal and this report clearly shows that longwall mining continues to be a driving economic force in our region, linking affordable energy with the livelihood of thousands of hard-working people,” said Tommy Johnson, Vice President of Government and Public Relations for CONSOL.

 

From supporting the day-to-day county functions, to infrastructure maintenance including updates to water systems, bridges and roads, Greene County Commissioner Morris recently spoke to the vital role the taxes paid by the longwall mining industry have benefitted his county. Additionally, Washington County Commissioner Maggi referenced upcoming bridge updates that wouldn’t be possible without a strong local tax base. Human service programs, parks and recreation and other quality of life initiatives also rely on this tax revenue.

The positive impact extends to the education sector as well. Upon reading the report, West Greene School District Superintendent Thelma Szarell said, “The West Greene School District is 256 square miles. The coal industry is critical to our existence, funding programs and curriculum with the majority of our graduating students retaining jobs directly in coal mining or with a company that would not exist without the industry. The construction of the new West Greene Elementary School would not be possible without adequate tax dollars and our local taxpayers would be burdened with higher taxes without the contribution from the mining industry to offset the rate.”

 

Approximately 7,350 full and part-time jobs in Greene and Washington Counties are provided by the longwall mining industry, making it the third largest employer. For each of those direct jobs, an additional 1.1 jobs are added indirectly in the counties. Those indirect jobs support entire industries like the Mining Products Division of Enersys in Washington, PA which manufactures and supplies batteries used in the mining process. The impact of the longwall mining industry extends well beyond Washington and Greene Counties.

 

As a whole, the coal industry in Pennsylvania provides $4.5 billion annually to the state economy, employs over 36,000 and provides 40 percent of the Commonwealth’s electricity; keeping rates low for residents and businesses statewide.

 

Brian Turk, Director of Government and External Affairs at Alpha Natural Resources said, “Any public discussion about coal mining is incomplete without taking a moment to acknowledge the ‘people impact’ of our industry.  Beyond the well-paying jobs provided, coal mining is the economic backbone of entire regions of our country.  When the industry struggles, so do our communities – from the local car dealerships and grocers, to the tax revenues that help build schools and hospitals.”

 

In Pennsylvania, we are fortunate to have elected officials, from both sides of the aisle that understand the strong reach of this industry and work to protect it.  Rep. Snyder (D-50) stated, "This report demonstrates just how much this mining process provides in employment and taxes that drive the communities in my district. It is why I have worked so hard to retain these jobs and support this industry; and respectively, my constituents."

 

Unfortunately, is it clear that on the federal level, the “people impact” has not been a consideration given the Environmental Protection Agency’s (EPA) proposed regulations under the “Clean Power Plan” (CPP).

 

This past December, the comment period on the CPP closed after roughly 1.6 million comments were received. The Pennsylvania Coal Alliance, along with legislators, public policy makers, electric ratepayers and laborers statewide took to paper and email to submit comments of opposition.

The proposed plan would require that by 2030 Pennsylvania will reduce carbon emissions by 32 percent over 2012 levels. Reducing emissions is an achievable goal and the coal industry and its utility customers have been actively developing advancements and achieving generation efficiencies and pollution reductions. However, the proposed reduction and timeframe for compliance is unachievable given the absence of currently available commercial technology and is essentially a ban on the industry.


A recent study conducted by NERA Consulting showed that if the CPP is enacted as proposed, Pennsylvania’s electric rates would increase by up to 31 percent. Roughly 2.4 million low-income and middle-income families in Pennsylvania spend almost 20 percent of their after-tax income on energy. The cost of energy directly affects the spending habits of these families on additional goods and services in the community affecting the local economies.

 

 

There is room for all energy types in Pennsylvania's electric portfolio. We are fortunate to have a strong and diverse supply of domestic resources that keep our prices low and attract businesses and industries that would otherwise go overseas such as manufacturing.

 

In 2012, manufacturing employed 574,000 Pennsylvanians, accounting for 10 percent of the total workforce with average salaries 44 percent higher than nonmanufacturing sectors. Without this industry, Pennsylvania’s economy would be decimated. And without a supply of low-cost, baseload electricity, Pennsylvania would lose manufacturing.

This past October, Pennsylvania joined other states in legislative action when H.B.2354 (Act 175), was signed into law allowing for the inclusion of the state legislature, educated parties and hearings to ensure all aspects and outcomes are weighed by the appropriate parties.
 

All of Pennsylvania anxiously awaits the EPA’s June 2015 Plan reveal and trusts that their elected officials will consider all of the consequences to both the local and state economies of a federal environmental regulation and respectively a forced state energy policy when working with DEP to draft the State Implementation Plan.
 

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