Column: Coal's free ride is costing all of us; let's end it
This week, New Mexicans from all walks of life gathered in Farmington to let their voices be heard about an issue that is costing U.S. taxpayers $1 billion a year, and contributing dramatically to climate change. We've been hearing a lot about the San Juan Generating Station, but less is being said about our coal leases on public lands, coal royalties and the current system that allows coal companies to set prices for themselves, paying less for a public resource we all own.
I know the words "coal royalty reform" might make your eyes glaze over, but it's important and let me tell you why.
Nearly half of the coal that is mined in America is extracted from public lands, including Bureau of Land Management land and our own San Juan Mine. This means coal companies lease the land from us, the taxpayers, and they are supposed to pay us a royalty for the use of the land and for the value of the coal they extract.
However, over the years, the coal industry has not paid fair market value for the coal mined out of our lands, and has received unfair subsidies — more taxpayer dollars — to do it. This has artificially deflated the cost of coal, giving it a false competitive advantage over other types of energy, including our own natural gas, and greatly affecting the progress of developing clean renewables like solar and wind. This hurts our environment and our hard-working taxpayers.
For too long, the coal industry in New Mexico has been taking advantage of these outdated federal royalty rules and regulations to game the system. What's more, state and federal governments have often been complicit in the coal industry's efforts to short-change taxpayers. Local governments desperately need this funding for schools, parks, roads, and infrastructure.
The BLM has finally taken up the issue and is proposing changes to modernize the outdated royalty system so that loopholes are closed and the taxpayers get the full royalties they deserve. The Department of the Interior and BLM must take steps in the right direction to ensure a fair return to taxpayers and improved transparency.
Citizens of our communities and state deserve our fair share of the federal resources developed within New Mexico, as well as updated rules that will safeguard public health and the environment. This means increasing the royalty rate to better account for health and climate impacts and reducing or ending subsidies to coal companies that mine on public land. This would ensure equity in how profits from coal are dispersed at the local level, and not only among the shareholders of the coal companies.
Clearly, these reforms are necessary and important because coal has been on a decades-long free ride at all of our expense.
Unfortunately, much of the damage has been done as climate change is making New Mexico more prone to fires, eventual drought and reduced snowpack. This has impacted tourism, ranching and the traditional ways New Mexicans have lived off the land for centuries.
Perhaps new royalty rules will also level the playing field and allow renewable energy to fairly compete with the old, polluting energy sources that have contributed to climate change. Only then can we begin to restore balance to our environment and also give taxpayers a fair shake.
Gloria Lehmer, a Farmington resident, attended and spoke at the "listening session" last week in Farmington, with Bureau of Land Management Director Neil Kornze, to solicit opinions on modernizing the federal coal program.