MORGANTOWN – Coal production
in West Virginia is on a decline that is likely to continue, according to a report from West Virginia
The report from the
Bureau of Business and Economic Research in the College of Business and
Economics at WVU discusses the decline that has been occurring in coal
production over the last several years and that likely will carry over into the future
for West Virginia.
It cites the drive
for stricter emission regulations for power plants and the diminishing use of
coal as reasons for the decline, in addition to low natural gas prices.
According to the report, West Virginia reached 158 million short tons of coal
production in 2008, which dropped to only 95 million short tons in 2015 and
is expected to fall to 68 million short tons in 2016.
“The industry saw a
big drop in production over the last few years,” Brian Lego, research
assistant professor at the WVU College of Business and Economics, told The West
Virginia Record. “Going forward we expect things to level off over the near
term, but then over the longer term that trend of downward production is
expected to continue."
The expected coal production
decrease will impact West Virginia in several ways as jobs will be lost and the state will lose revenue. Coal produced in the southern half of the state is used for both electricity and steel production, while coal produced in the northern half of the state is primarily used for electricity production.
“The coal industry,
while it accounts for a relatively small percentage of jobs within the state,
those jobs tend to be higher paying so those high-wage jobs are lost,” said
Lego. “The industry accounts for somewhere around 16 percent of the gross state
product. One of the things the state relies upon for cash collection is severance
taxes, so with a drop in the output of coal and the price, state severance tax
collections have fallen. That’s one of the reasons why the state is experiencing
some difficulties with its budget.”
While natural gas
production may be an area where West Virginia can recoup some of the lost
revenue from coal, unfortunately it is not occurring in the same parts of the
state that have coal production, creating a gap in jobs and financial
“The state has seen
a big jump in natural gas production over the past several years,” said Lego. "Unfortunately,
the way things work geographically, the areas that have seen fast growth in
natural gas production is not the same portion of the state that’s seen a rapid
fall-off of coal mining jobs and coal production.”
Stricter emissions regulations
for coal-fired power plants are also causing some of drop-off in coal production
as plants look for ways to meet the regulations, often by reducing capacity.
“The easiest way
that I think a lot of states are going to find to reduce carbon dioxide emissions
from their power plants is to retire coal-fired capacity,” said Lego. “Ultimately,
that will just cause the northern half of the state’s coal production to take a