The coal industry in the United States is at its all-time low. In 2014, demand for coal peaked for the first time and has since plummeted. Meanwhile, coal companies are tanking. For instance, Peabody Energy, the world’s biggest coal company, sold stocks below $1 in 2015 when they used to be $72 in 2011.
Thousands are being laid off, but somehow the top execs are getting a raise, as ZME Science previously reported, despite the companies they ran lost 58% of their value on average between 2010 and 2014.
A number of factors have dragged down the coal industry. Increased competition from natural gas (thanks to the fracking boom) decreased demand and stricter environmental regulations have all hurt the industry. Since 2011, the coal sector as a whole has lost 94 percent of its value according to a Bloomberg analysis.
The energy industry is up for a massive paradigm shift, one that’s happening fast but was always predictable. Burning fuel that’s been trapped in the ground for millions of years is not only harmful and expensive on so many levels, it’s also freaking primitive.
Critics, however, say that this transition is bad for the economy because a lot of people will lose their jobs. Well, that’s what they said when tractors displaced plows or when cars made horse and buggies obsolete. Get with the times, folks — it’s called progress.
Aside from the obvious arithmetic that says a displaced industry loses jobs only to leave room for another to add jobs, these people who’ve lost or will lose their jobs working in coal or oil&gas can repurpose their skills to join the ranks of the renewable energy sector. And this is a lot easier than it might sound, provided there’s a will to do it.
In a new study published in Energy Economics, researchers at Michigan Technological University and Oregon State University found a minimal amount of money is enough to train coal workers to help them switch from a dying to a booming industry, the sustainable energy one.
Over the next 15 years, the researchers calculated that it will cost between $180 million (best-case scenario) to $1.8 billion (worst-case scenario) for the vast majority of the current people employed in the coal industry to switch. The worst-case scenario basically assumes that all of the workforce currently employed by coal will transition to clean tech. The best-case scenario assumes that all workers whose professions don’t depend on coal, such as electricians or accountants, will find jobs in another industry.
Perhaps the most startling finding was that the salary of a CEO was more than enough money to re-purpose the skills of all the company’s employees. They came to the conclusion after averaging the training costs for coal workers. fFirst, they combed through statistics from the Bureau of Labor Statistics to identify all the coal industry positions, the skill sets required for each and the yearly salary. Then, they determined the closest equivalent position in clean tech for each coal position and evaluated the costs.
“For example, an operations engineer in the coal industry could retrain to be a manufacturing technician in solar and expect about a 10 percent salary increase. Similarly, explosive workers, ordinance handlers, and blasters in the coal industry could use their sophisticated safety experience and obtain additional training to become commercial solar technicians and earn about 11 percent more on average,” wrote Joshua Pearce, the study’s co-author and associate professor of materials science and engineering at Michigan Technological University.
The researchers identified four scenarios under which this transition can be funded:
Coal Employees Self-fund Retraining. “In this status-quo scenario coal employees must shoulder the entire burden of retaining themselves when their employer closes the mine or power plant and no policy intervention is necessary.”
Policies Promoting Coal Industry Paying for Employee Retraining. “In the second scenario, the coal industry is either mandated to pay for their employee retraining or chooses to do so on their own.”
Individual States Policies to Provide “Coal to Solar” Transition Programs. ” Implementation of the retraining could take several forms: i) scholarships, education vouchers and grants for coal employees to State universities, colleges and community colleges, ii) subsidized expansion of solar industry training such as the workshops and classes provided by entities like SEI, iii) State sponsored free courses and certificates for PV positions, and iv) no, low-interest or subsidized loans for education and retraining.”
U.S. Federal Government Policy to Fund the Coal to Solar Transition. “In this scenario the U.S. federal government funds the coal to solar transition alone.”
Green Tech Media reports that the CEO of Consol Energy earned $12 million in 2012, while the top executives of Arch Coal, which has filed for bankruptcy, collectively netted $29 million. In both cases, these cash handouts would’ve been enough to re-train the thousands of employees they laid off, as the researchers found only 5 percent of a coal company’s typical revenue would be enough to fund the retraining of their former works (scenario #2).
“If they’re going to use energy alternatives, why can’t they bring a solar panel plant here, or train us even to install them in the field?” said Bob Wilson, a former coal miner for Emerald Mine, which closed down after Alpha Natural Resources filed bankruptcy. “Coal miners are some of the most versatile people here on the planet. We’ve all run equipment, done welding, fabricating. We’ve built million-dollar belt drives from the ground up. We can do this stuff with a little bit of help.”
“Where’s our bailout? It’s not a handout to get our houses re-built,” said Wilson. “We just need the help to get a good-paying job. We just need unemployment extended for two years, so these people can train for a good job. That’s all we’re asking for.”