Friendly policies keep US oil and coal afloat far more than we thought (2017) | Hacker News Reader

Friendly policies keep US oil and coal afloat far more than we thought (2017)

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152 pointsaaronbrethorst43 comments

There are a bunch of strange state-level credits, too. Coal mining credits are regularly reinstated here in Virginia, for instance, and there are also huge subsidies for infrastructure like ports and railroads primarily used for transporting coal.

Also, there are indirect subsidies like depressed property values around coal-oriented rail lines, dust blowing from open rail cars and coal piles into the lungs of nearby residents causing increased asthma rates: https://www.motherjones.com/environment/2017/10/this-huge-ra...

Very few people actually work in these highly-mechanized and automated facilities. Eliminating coal terminals in city limits would easily pay for itself in increased tax revenue from businesses and housing in currently uninhabitable areas surrounding these dusty coal terminals.

EDIT: based on the fact that asthma rates are about double in the areas surrounding the terminal and that (based on state-level statistics) there are about 10,000 asthmatics in Newport News with about a tenth of the population of the city living near the coal terminals, that means there are probably on the order of 500 more asthmatics in the area than there would be without the coal terminals. From what I can tell, there are fewer than 500 people actually employed in the two Newport News coal terminals, so we're talking at least one additional case of asthma for every job in the coal terminals.

EDIT AGAIN: Ex-Im loan guarantees also go to coal export facilities: https://chesapeakeclimate.org/blog/lawsuit-seeks-to-stop-fed...

Sometimes I wonder if the attachment to certain industries and jobs is hidden in the psychology of men who were once boys.

You were talking about "rails lines". I remember living in a coal town like you're describing and it was fascinating how much the coal terminal seemed like a massive Tonka Truck set. Big trains, cars and ships coming in out and constantly and the men who were fascinated by all of it. Those who owned and operated it, like a huge toy train set. I mean it was interesting.

Most people who worked there just loved the coal industry and what it was about, comradery, big shiny trucks etc.

I'd actually love to know if anyone has actually found any research on the euphoria and attachment people have to fossil fuel industries and if that has anything to do with part of their ongoing popularity and support for mining jobs (obviously asside from just the money part).

It honestly seems like some people would feel like a part of them were dead if it's all shut down. I did once see a documentary on post coal mining depression in some places in the UK and it's real.

Renewable energy doesn't really have the same kind of boyish appeal I guess.

That might be a factor, but I doubt it really matters much. I think the real reason there is so much attachment is that change is hard, and ending coal means that coal miners (and lots if other people working in related industries) will have to basically restart their entire life. They'll also lose a lot of their wealth.

Coal mining towns would become ghost towns, coal miners homes will lose most value (who wants to live in a ghost town), they'll have to move for new work, losing their friends and community in the process.

A lot of coal miners and oil workers (probably most) only have a high school diploma. You get rid of coal and oil you get rid of some of the last well paying jobs that don't require college.

Finally, this doesn't just effect the coal miners. This effects railword workers, suppliers, the people working at the gas station where miners buy their coffee, who'll soon be out if a job when the gas station closes, etc. Literally the entire town, except those who are retired or close to, will be forced to move and will lose a lot of their wealth in the process, lose friends, etc.

In Wyoming for example, this will also impact other parts of the state. When coal was doing poorly a few years ago, the loss in state budget caused layoffs at the University of Wyoming, for example. The impact will be far reaching. It makes sense that politicians that work to avoid that are popular in these areas.

While we should definitely be helping these communities to transition as smoothly as possible, this concern strikes me as somewhat hypocritical in the country built on Manifest Destiny and sacking/building highways through non-white neighborhoods. I think, in the back of their minds, people realize this; they're fighting so hard because they know that they're on the side that generally gets steamrolled over.

That's exactly right, but just because we treated these people like dirt in the past doesn't mean we should continue to do so in the future.

> get rid of some of the last well paying jobs that don't require college

I think this is a myth that desperately needs quashing. There are still tons of trades that pay well especially in home construction like electricians and plumbers. Getting more people into these fields could also help alleviate some of the housing crunch by increasing the number of houses we can build at once.

I think what you're describing is a real thing, but the strange thing about Newport News is it's much more known for shipbuilding, and that employs about two orders of magnitude more people: https://www.dailypress.com/business/newport-news-shipyard/dp...

...if anything, I think the coal export terminals run under the radar of the local community. The people who live close to the terminals are too poor and lack enough power to do much about them, and the terminals are basically ignored by everyone else. There's also a lot of other port traffic in Hampton Roads, including shipping containers and vehicle carriers as well as a lot of military vessels, and that accounts for more traffic and far more revenue than the coal terminals. If anything, Hampton Roads is known for its military bases (all branches of the military) and ship building.

The thing about coal is it's still very cheap and so is responsible for very small amounts of revenue given its enormous environmental footprint. Oil produces over ten times the revenue per unit energy than thermal coal (and generally has lower economic footprint per unit energy since it's more gravimetrically energy dense and has lower ash and carbon content per unit mass) so is more economically important for a given environmental cost.

Additionally, what's odd about these facilities is they're for metallurgical coal exports, meaning they're contributing to the off-shoring of the US steel industry.

While oil does have an advantage over coal in energy density, coal has an advantage over oil in its mobility. Environmentalists don't protest the railroad that's carrying coal as much as they protest pipelines.

It's also about power. There's a good book called carbon democracy about how coal naturally led to the upsurge of democracy because it was labour intensive - he who can interrupt the flow of energy controls society and coal required a LOT of people to function.

Apparently the original shift to oil (started by churchill before ww1) was done in large part because it was far less labor intensive and so it took political power out of the hands of coal miners.

I can imagine how it felt to have income, camaraderie, identity and political power stripped from you all at the same time. Not great.

Now the coal industry is incredibly automated and mechanized, so I think the opposite is true today. Dump trucks with 400 tons capacity require just one operator, and even they are being automated in some ore mines with self-driving technology. If you look at aerial pictures of incredibly productive coal mines (in the Powder River Basin, for instance), there's just a few of these massive machines (which can be operated by one person) among many square miles. The coal industry only employs about 80,000 people in the US, in spite of the US accounting for a tenth of the world's coal production. That's less than a tenth the number employed in the 1920s when US coal production was about half of what it is today.

Mechanization and automation already did far more than eliminating the rest of the coal industry would.

Sounds like a milder type of conspiracy theory to me. Compared to coal, crude oil has higher energy density, provides better fuel to operate machines, and was less labor intensive to extract - isn't it quite enough for oil to expand into coal territory? Without some special political decision? Also, as we know democracy happened to places without mining industries at all.

I always get a bit sad when a chunk of land that was once used to produce something (e.g. an old research plant), gets converted into something to consume something (e.g. a mini mall). Several of the vestiges that existed when I was a kid of what gave silicon valley its name are now gone and replaced with shopping centers.

The wind energy industry does have some pretty fun trucks too though: https://www.popularmechanics.com/technology/infrastructure/a... (and uses some of the biggest mobile cranes in existence: https://www.youtube.com/watch?v=HvAZu81oooE )

Perhaps if these kinds of videos got more popular attention the industry would feel more "fun"...

Speaking from a uk perspective, the town serviced the coal mine, the town wouldn't exist with the coal mine. Mining is a dangerous dirty activity so you do get a camaraderie that comes from that.

So if the mine goes, everything goes, you lose your job, the people you know lose their job, but you also lose who you are. If you work in a coal mine, you are a miner in a way that working in a supermarket doesn't make you a check out assistant.

I'll agree there is some appeal to clanking machines, but its missing most of the point to reduce it to that.

Ps IMHO a massive wind turbine can hold its own with any steam engine or tonka toy any day of the week.

Yes, I remember listening to the BBC radio ballads with interviews with men who'd worked in mining and heavy industry. These were genuine communities; pretty everyone you socialised with would be people you worked with. And there was a lot of culture - people talked about learning about poetry and being introduced jazz music from older colleagues in a ship yard.

But the thing that really stood out to me was this: men who had worked in the mines were happy with their lot and had lots of positive things to say about their working lives, but when they were asked if they would want their children to work in mines their answer was a definite no.

Look at the Bevin Boys: from 1943-1947 once a week the minister would pull out a digit from 0-9, and all men liable to report that week whose registration numbers last digit matched the minister's pull were sent off to be coal miners. While soldiers viewed this as a way to escape the dangers of the front, the men themselves faced the dangers of coal mining without a guaranteed job to come back to (unlike with soldiers, who could not lose their job due to government service).

But that was the only way that a Britain at war could get enough coal miners. Conscripting them

I get that same boyish joy seeing the HUGE wind turbine blades heading down I10 in Texas.

> indirect subsidies — things like the money the US military spends to protect oil shipping routes

Nice one. Never thought about this.

Some of these are far more expensive than others. The Afghan war in particular involved shipping in some very expensive oil products due to a very long and dangerous route. Every drop of gasoline had to be shipped across most of Pakistan and over two mountain passes. Convoys were often attacked.

https://en.wikipedia.org/wiki/NATO_logistics_in_the_Afghan_W...

The situation was unstable, as much of northeast Pakistan is only loosely under government control and there are quite a lot of anti-US militants there: https://www.rferl.org/a/NATO_Supply_Route_Imperiled_As_Pakis...

The intermittent engagement between US troops and cross-border Taliban resulted in the US bombing a Pakistani Army post: https://en.wikipedia.org/wiki/2011_NATO_attack_in_Pakistan

Not unreasonably, this upset the Pakistani Army: https://www.pri.org/stories/2011-12-02/pakistan-truckers-app... "The head of Pakistan's army Friday gave the go-ahead for his soldiers to return fire on US troops, if attacked"

The US backed down rather rapidly when it realized that going to war with Pakistan would result in the total stranding of their forces in Afghanistan. It has never been entirely clear whether some of the loosely controlled Pakistani intelligence services are supporting the Taliban or not: https://en.wikipedia.org/wiki/Inter-Services_Intelligence_ac...

To those reading this, while most/all of this true, the security situation in this region of Pakistan has improved greatly over the last ten years, due to several internal military campaigns by the Pakistan army. Last year, the northwestern part of Pakistan, which was previously its own territory had become stable enough to be incorporated into the nearest province (KPK). https://en.wikipedia.org/wiki/Khyber_Pakhtunkhwa

The same protection exists for major shipping routes the world over, not only oil. I'm not sure it is useful to include this in calculations of the subsidies to the fossil fuel sector any more than we would include it in calculating subsidies for tech firms building products in China and shipping them around the world.

I think in general it makes sense to try to account for externalities in everything. If you spend lots of money on things like protecting shipping routes and accounting for that in the product cost tips costs in favour of manufacturing closer, then that's important to understand.

Considering just how much US military presence is in the Middle East primarily for protecting energy assets, I think it is useful. It's disproportionate to the actual value produced compared to other shipping protection deployments.

How much of the oil used in US comes from middle east?

That's the crazy thing. Nowadays, it's not even very much (on the order of $30 billion in oil per year, much of which is refined and re-exported as gasoline, etc), but we have massive military investments in military bases in Saudi Arabia, Kuwait, Bahrain, Qatar, UAE, Oman, Djibouti, etc. There's no way this passes the cost vs benefit sniff test.

Unlike the mid-aughts, the US is very nearly a net exporter of oil and oil products: https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=m...

What matters is mostly the global price.

It doesn't matter how much physically comes from there to here, it matters how much their production brings down the price of the global commodity.

Well, that's the key point about becoming a net exporter of oil, isn't it? If the global price of oil shoots up, the extra cost to consumers is easily offset by the increased revenue for domestic oil production. If that's not good enough for you, there's also the option of protectionist measures to keep the price of oil for consumers nearer what it was originally (which is less economically efficient but is no worse than where you were at first).

That's the main argument for being "energy independent."

I suppose this depends on the relative risk that said items have.

I would guess that for a pirate in East Africa some items would be more valuable than others. Is oil more valuable than say iPhones to them?

the war in iraq was exclusively about oil

I think most major wars in the last 100 years could be characterised as for either markets or energy.

And, its not like any other cargo ships use those protected routes, either.

Surely no one believed that criticism of clean fuel subsidies was anymore intellectually honest than calls for a balanced budget.

If you look at the graph of subsidies, and adjust to percentage of generation, then you can see that renewables receive a higher level of subsidy.

A big chunk of the "subsidy to non-renewables" is support for heating for the poor. This allocation is by virtue of most generation being non-renewable. When we move to more-expensive renewables, this support will be bigger and will have moved to the renewable column. So, it's not really a subsidy to non-renewables.

This is just a couple of things I noticed - you need to be alert to creative accounting when it comes to renewables, because many people tend to be motivated by ideology rather than numbers.

> A big chunk of the "subsidy to non-renewables" is support for heating for the poor.

They address this directly, guess you missed it.

"OCI is only counting direct production subsidies. As they acknowledge, that leaves out a great deal.

For one thing, it leaves out the annual $14.5 billion in consumption subsidies — things like the Low Income Home Energy Assistance Program (LIHEAP), which helps lower-income residents pay their (fuel oil) heating bills."

That's what I'm referring to.

has anyone done similar analysis for UK/EU?

In the UK, when I was a kid some (for the time) hard economic right politicians had power and the coal mines were Union bastions since almost the beginning of unions, so the politicians destroyed the coal industry.

Some people are understandably still very angry about this today - after all it destroyed their communities. But an unintended consequence is that it was far easier to disentangle the country from coal power. If you're importing it anyway having closed your own mines, there are fewer angry hard working people to protest when you stop.

So the UK now often (as in most of the day, and sometimes for days at a time) has no coal electricity generation.

The other thing they did was take a very big coal power plant and convert it to burn trees. Notionally it burns "waste" wood but in practice the volumes involved mean people are growing trees to sell as "waste" for that plant. This is not great for the environment, but hey at least it isn't coal.

Depending on how the trees are grown it might even be okish fir the environment. At least the fuel itself is CO2 neutral. Loosing the land on the other hand is a different story.

It's mostly imported. Last time I ran the numbers I calculated that Drax would burn every tree in the UK within a year if limited to local wood. Supposedly it's sawmill waste: https://www.drax.com/sustainability/environment/#sourcing-su... that would otherwise be burned as waste: https://www.drax.com/sustainability/one-company-helped-trans...

Not everyone agrees: https://www.redpepper.org.uk/activists-are-taking-on-the-uks...

Had to smile as apparently now one has to mention UK separately.

stable genius

Friendly policies arent good for defence stocks. Since trump, the price growth has been so volitile, actially everything is worth less since obama, who oversaw year on year profit in the defense industry. Things are turning now, its now time to reinvest in defense stocks.

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