HELENA — Republican leaders on a U.S. House panel said Tuesday the success of the Powder River Basin shows the need to expand coal mining on federal lands, even as they downplayed a report that says taxpayers may not be getting a fair return from the mining.
The Powder River Basin in Montana and Wyoming accounts for more than 40 percent of U.S. coal production, providing cheap electricity to the nation and millions of dollars for the two states, Rep. Doug Lamborn of Colorado said.
Increasing demand for coal around the world presents an opportunity to boost production and lease more federal land, the chairman of the House Natural Resources subcommittee said.
But President Barack Obama’s recently announced plan to reduce emissions from coal-fired plants threatens to “grind to a halt” development in that region and other coal-producing areas, he said.
“It would be the height of folly to throw this resource away,” Lamborn said at Tuesday’s hearing.
Obama last month said he would use executive orders to reduce carbon dioxide emissions by 17 percent by 2020 and boost renewable energy production on federal lands as part of his initiative to fight climate change.
The hearing included testimony from representatives of Montana’s Crow Tribe and Wyoming’s Campbell County on their communities’ dependence on coal.
Crow chairman Darrin Old Coyote said half of his tribe’s budget is paid for with coal revenue, and without it, unemployment would likely skyrocket from 47 percent to 80 percent.
Campbell County commission chairman Dan Coolidge told the committee that Obama’s anti-coal stance could be devastating to his community.
“We reject the notion that energy policy is an either/or discussion. We can have both,” he said.
Democratic members of the panel used the hearing to highlight a recent Interior Department inspector general’s investigation that estimated at least $62 million in potential lost revenues due to the agency undervaluing coal.
Coal production on public lands is not closely scrutinized, only a handful of companies bid on leases and taxpayers could be losing millions of dollars because the Interior Department’s Bureau of Land Management has undervalued the coal, said Rep. Jared Huffman, D-Calif., the panel’s leading Democrat.
Acting inspector general Mary Kendall said BLM can improve its coal-leasing program if it used the department’s Office of Valuation Services instead of its own appraisers to determine the value of the leases.
The sample of leases studied found instances where bids were accepted below fair-market value and where revenue was lost after some leases were modified, she said.
Republican members of the committee questioned the report’s findings, saying there are cases where companies have bid above fair-market value for their leases and there are only a limited number of companies that have the ability to develop the coal.
If Democrats are concerned about revenue, they should support opening more mines, Lamborn said.