Hans Sprohge, Ph.D., CPA Wright State University, U.S.A. Julsuchada Sirisom, Ph.D. Mahasarakham University, Thailand 1

 Coal formed from massive accumulation of dead land-based plant life, mainly trees.  The most important element in the plant material is carbon, which gives coal most of its energy.  When plants die, this energy is usually released as the plants decay. The energy is locked into the coal.  Coal is classified as a nonrenewable energy source because it takes millions of years to form. 2

 Coal is mined using surface and underground methods depending on depth of burial  Surface mining is used for seams relatively close to the surface, at depths less than approximately 180 feet  Underground mining is used for seams that occur at depths of 180 to 300 feet 3

 2 principal methods: continuous (room and pillar) and longwall  Continuous mining utilizes a machine to cut 20-to 30 foot "rooms" or work areas into a coal seam and Some of the seam is retained as "pillars" to support the rock layers above the area being mined  Continuous mining can produce as much as five tons of coal a minute 4

 Longwall mining uses a rotating mechanical shear that moves back and forth across the coal seam tearing the coal away  The seam being mined is several hundred feet wide  Once the coal is removed, usually 75 percent of the coal in the deposit, the roof is allowed to collapse in a safe manner 5

 a coal seam is exposed by removing the overlying vegetation and overburden  5 principal methods of surface mining: area mining: consists of excavating large rectangular pits open pit mining: the removal of overburden to uncover the coal seam takes the shape of an inverted cone 6

contour mining: removing overburden in a pattern following the contours along a ridge or around a hillside auger mining: horizontally into coal seams with a mining auger mountaintop removal: removing entire mountaintops to reach thin layers of valuable low-sulfur coal seams lying underneath the mountains 7

 The oxidation of sulfur  The production of sulfuric acid  Elevated concentrations of dissolved metals, such as, iron, sulfate, and other metals  Waste materials are piled at the surface, in underground mining, and rain percolating through these piles creates runoff that pollutes local streams  Acid mine drainage and acid rock drainage leave the subsoil infertile 8

 Mountaintop removal breaks a forest into many pieces  Limit habitat for animals, plants, and leaves  Loss of natural species biodiversity  12-million-acre area in east Kentucky, south West Virginia and east Tennessee has been damaged  By 2012 mountaintop coal mining will have serious damaged or destroyed an area larger than the state of Delaware 9

BeforeAfter More than 300,000 acres of hard wood forests have been destroyed by mountaintop removal Source: Source: 10

 Various federal and state laws require coal mine reclamation (the rehabilitation of land after cessation of coal mining operation) The Surface Mining Control and Reclamation Act (1977) National Historic Preservation Act (1966) National Environmental Policy Act (1969) Endangered Species Act (1973) Resource Conservation and Recovery Act (1976) Clean Water Act (1977) Clean Air Act (1990) 11

 Environmental degradation continues after laws  Some of reasons: Lax enforcement Loopholes Corporate gamesmanship 12

 The rate of coal mine reclamation occurring today is shockingly low  The destruction of all forms of habitat is complete and permanent  Reclamation of many mining sites re-vegetate using native plants but not of the “same seasonal variety”  Frequently, mining sites are re-vegetated with plants that are not native to the area.  Sometimes mining sites are re-vegetated with invasive species  It is impossible to reclaim waterways 13

 The mining industry has been, and continues to be, provided with economic incentives to wreak havoc on the environment  From 2002 to 2008 coal mining companies received billions of dollars in tax breaks annually  Benefits indirectly through the Low Income Home Energy Assistance Program 14

 tax credits for the production of coal coal- based synthetic fuels  characterizing coal royalty payments as capital gains  exclusion from fuel excise tax  expensing (rather than capitalizing and amortizing) of the costs of surface stripping, and construction of shafts and tunnels  deductibility 10 percent of gross income from coal production  deductibility of reclamation and closing costs immediately when beginning mining 15

 Eliminate direct and indirect taxpayer subsidies of coal mining companies by a) not adding more tax preferences that lower the after tax cost of producing coal and b) repealing those that are currently in effect  Shift cost of reclamation from the public to the mining companies by imposing taxes on carbon emissions, the value of lumber destroyed, lost carbon sinks, and lost plant and animal species 16

 Implementation of any of the above recommendations would result in higher coal prices  Higher coal prices would encourage conservation  Unsubsidized coal prices that include the cost of environmental remediation would make clean renewable technologies like wind, geothermal power and solid biomass more cost competitive with coal 17