The Green Glance | Coal industry under scrutiny by major banks, government

Nathan Zucker Columnist

Many years ago, coal appeared to be a panacea for mankind’s problems. Huge reserves provided access to seemingly unlimited amounts of energy, allowing for the expansion of industry and creature comforts such as heating. More importantly, coal replaced wood as western society’s main source of energy at a time when Great Britain was facing unprecedented deforestation.

If we fast-forward a few hundred years, we see that the situation has changed dramatically. We still rely on coal just as much, according to the Energy Information Administration, a U.S. government agency. Annual world consumption stands at 6.2 billion tons, and the United States produces over 50 percent of its electricity by burning coal.

However, dependence on coal is no longer a source of pride for modern society; rather, it is one of the biggest problems we must confront. Coal contributes to global warming more than any other fossil fuel, and it is also responsible for serious air pollution in urban areas.

Until recently, the coal industry was an accepted part of corporate America. Energy corporations were routinely financed by major banks, and state and federal government agencies believed that coal was a vital means of expanding our energy infrastructure. However, it appears that the tide is turning—and fast.

Citigroup, Morgan Stanley and Bank of America, three of the biggest banks in the world, have recently announced their concern over the coal industry’s contributions to global warming. These corporations admit that they are reluctant to finance the construction of new coal plants.

These banks are not simply acting altruistically; they all know that carbon taxes and emissions limits are on the horizon due to the gravity of global climate change. Since the coal industry has no effective plan to cut its pollution, banks are worried about economic losses resulting from more stringent environmental laws.

Even the government is reconsidering its lax approach to regulating the coal industry. Although carbon dioxide emissions are untouched by federal environmental laws, many states are simply denying necessary permits for the construction of new coal plants due to the threat posed by global warming. A huge controversy erupted in Holcomb, Kan. after the state Department of Health and Environment refused to grant Sunflower Electric the right to construct two new coal plants.

Following this decision, Sunflower Electric began a massive advertising campaign touting the benefits of its new plants. The energy corporation even offered the state of Kansas $2.5 million for energy research on condition that the plants be approved—what basically amounts to a bribe. Kansas Representative Paul Davis criticized this arrangement harshly, saying it was “in poor taste.”

Although environmental activists may be wary of corporate and government interests, there are some allies to be found within this sphere. Banks control many of the projects detested by ecologists, such as large-scale logging and the construction of coal plants. Citigroup and Morgan Stanley have both announced their opposition to unsustainable logging, and their new stance on global warming is one to be respected. Without the backing of banks, it will become difficult to finance projects that harm the environment.

State and municipal governments have also begun to take action on global warming, an issue that the federal government has practically ignored. Portland, Ore. may have started the trend with its bike lanes and hybrid vehicles, but it is spreading to more conservative states as well. Kansas’s recent opposition to Sunflower Electric is empowering, as it shows a new, more local approach to fighting climate change.

Vassar, too, is grappling with the issue of excessive coal consumption. The College’s power comes from Central Hudson Gas & Electric, a company that depends heavily on burning coal. Although Vassar’s heating plant is highly efficient and does not use any coal, huge amounts of energy are lost in the steam distribution system that brings heating across campus. The administration is working with the Sustainability Committee to resolve this problem through heat recovery and insulation.

“The College learned its lesson in the Jewett House renovation that scrimping on controllability and insulation will cost lots of money down the road,” said Nate Kimball ’09, Communications Intern for the Sustainability Committee.

Perhaps the battle against global warming, and particularly the coal industry, is finally catching on; it’s certainly about time. Whereas coal was once a solution to be embraced, it is now the problem that society needs to tackle.

—Nathan Zucker ’10, a Latin American Studies major, is writing about environmental issues that affect both the Vassar community and the world at large.