Current work in wildlife, rivers, public lands, and climate

Denver—A new report released today by the U.S.Government Accountability Office, the investigative arm of Congress, found the U.S. Interior Department is auctioning coal at below cost and ignoring coal exports, underscoring the immense threat that the federal coal program poses to our climate and the public interest.

“The Interior Department isn’t just shortchanging the American public, they’re shortchanging our climate,” said Jeremy Nichols, WildEarth Guardians’ Climate and Energy Program Director. “It’s time to put the brakes on more coal sales until Interior can fix its coal program.”

The report, spurred by a request from U.S. Senator Edward Markey, examined the leasing of federal coal, which is publicly owned, finding, among other things, that:

• Noncompetitive leasing is rampant, with 90% of all coal leased by the Bureau of Land Management, the Interior Department agency charged with managing federal coal, since 1990 attracting only a single bidder;

• The Bureau of Land Management is failing to ensure its appraisals leased of federal coal are independently verified and consistently undertaken;

• The Bureau of Land Management is not valuing coal based on demand, essentially ignoring the coal export markets when leasing federal coal;

• The Bureau of Land Management is, in some cases,selling coal at below fair market value rates; and

• The public is not being provided adequate information to demonstrate the integrity of the federal coal leasing program.

The report prompted a statement from Senator Markey calling for a “temporary suspension” of new federal lease sales until the problems identified by the Government Accountability Office are addressed.

More than 40% of all coal produced in the U.S. comes from federal leases, with the large majority of these leases located in the western states of Colorado, Montana, New Mexico, Utah, and Wyoming. In 2012, more than 440 million tons of coal was mined from federal leases. Most of this coal was shipped to domestic power plants to be burned. Increasingly, this coal is exported and burned internationally.

When burned, this coal produces nearly a billion tons of carbon dioxide annually, fueling global warming at a time when President Obama has called for aggressive action to combat climate change.

The findings of the Government Accountability Office stoke concerns that the Interior Department is selling federal coal at below cost,incentivizing more mining and more burning at the expense of taxpayers. Between 2009 and 2012, the Obama Administration sold more than 2.2 billion tons of federal coal. Just in 2012, the Interior Department sold more than one billion tons of coal from the Powder River Basin of Montana and Wyoming, the nation’s largest coal production region.

The Interior Department has approved an additional 1.2billion tons of leasing and further signaled its intent to lease more than 3.8billion tons of new coal, including 3.8 billion tons just from the Powder River Basin.

One lease, a 298 million tons lease sought by Cloud Peak Energy, would expand the Spring Creek Mine in the Powder River Basin of Montana, one of the largest in the nation. Cloud Peak has indicated it intends to turn its Spring Creek Mine into an “export complex” to reap higher profits.

A report prepared by the Institute for Energy Economics and Financial Analysis in2012 found that since 1990, taxpayers have lost nearly $30 billion due to undervalued federal coal leases. And, in 2013, the Interior Department’s Office of Inspector General chided the Department for failing to take into account coal exports when leasing federal coal.

The Government Accountability Office’s findings today underscore that the Interior Department’s coal leasing program is costing Americans, fueling industry profit on the export market and incentivizing more mining and burning.

“More leasing promises only to line the pockets of the coal industry at the expense of the American public and our climate,” said Nichols. “Interior can’t, with any integrity,continue to lease more coal when its system is so obviously broken.”

WildEarth Guardians has been confronting Interior Department coal leasing decisions in the American West for several years and is currently in court to overturn more than 2 billion tons of coal leases in Colorado and Wyoming.