A new report finds that as the coal industry declines, companies may abandon up to one thousand square miles of coal mines across seven eastern states, including Pennsylvania.
Abandoned coal mines are already a widespread problem, especially in Pennsylvania, where one-third of the country’s legacy mines are located. Abandoned mines are hazardous to human health and the environment: They border local communities and leach acidic runoff into streams. But according to the report, released by environmental nonprofit Appalachian Voices, bankruptcies may cause coal companies to abandon a new wave of mines.
“The coal industry has been declining for at least five years now. We can’t predict the future, but we know that bankruptcies are continuing,” said Erin Savage, a senior program manager at Appalachian Voices and the author of the report. “With those bankruptcies, we are seeing companies walk away from their reclamation obligations.”
Changing Times for Coal Mines
This was not supposed to happen. In 1977, the federal government passed a law that was meant to safeguard against coal companies walking away from their messes. The legislation required coal companies to post bonds for each mine permit they hold to cover the cost of clean-up if they do not maintain their mines.
But as coal companies go bankrupt, they sometimes forfeit their bonds, leaving state agencies responsible for paying to reclaim their abandoned mines. The bonds do not always cover the cost of reclamation. Sometimes clean-up is more complicated or expensive than estimated. Other times, state rules have allowed companies to post less secure types of bonds, such as self bonds.
“Self bonds are essentially just the company’s word that it will have enough money to cover reclamation. There’s no actual money secured anywhere,” Savage said. “It’s sort of a ‘too-big-to-fail’ model — except that we are seeing large companies fail now.”
The report estimates more than 600,000 acres could be abandoned by bankrupt coal companies in the coming years, at a cost of $7 to $10 billion. The report estimates only 40 to 50 percent of that liability is covered by bonds across the seven states. Pennsylvania has an estimated $1.25 billion in modern mines needing reclamation, with available bonds covering 56 to 65 percent of the liability.
The 1977 legislation created the Abandoned Mine Land fund to cover the cost of coal mine cleanup, but the fund does not apply to modern-era mines.
“We see this as an additional problem that needs its own pool of money to address bonding shortfalls,” Savage said.
New funding for mine reclamation could create jobs for coal workers as coal production declines.
New Reports: Cleaning Up Coal Sites and Plugging Gas Wells Could Create Thousands of Jobs