Utah’s Coal Terminal Investment Bill Gains Approval

AP file photo; Rick Bowmer
AP file photo; Rick Bowmer

Creating what could be another, future legal battle for the Beehive State, last night the authorization to shift Utah transportation funds to its own industrial assistance accounts came one major step closer toward an intended investment in the expansion of the Port of Oakland.

An authorization bill to that end left the Utah Senate and is now headed for House approval. Leaving no doubt that the effort behind SB 246 – Funding for Infrastructure Revisions, sponsored by Senator Stuart Adams (Republican- Layton) is linked to Utah’s desire to maintain a beleaguered coal economy, Governor Gary Herbert (Republican) emphasized in a press conference today that the state’s effort is most certainly meant to extend the market for the state’s coal.

Herbert cited the role of the federal government, under the commerce clause of the U.S. constitution, to enable Utah’s access to energy consumers along the Pacific Rim and anywhere else the state might choose. Long-time observers of the state’s posture in similar conflicts understood all of those to be fighting words, preparatory to the very real possibility of future litigation in federal court or at the very least, an appeal for a ruling from the Federal Trade Commission.

The Conflict Looms Larger

Since Utah is completing plans to finalize its authorization of a $53 million investment in Terminal Logistics Solutions’ (TLS) shipping terminal near the east end of San Francisco’s Bay Bridge, California State Senator Loni Hancock recently increased her own state’s efforts to oppose the coal aspect of the development. The 14-year legislative veteran, whose Northern California Senate District 9 includes more than one million constituents, sent a letter to California Transportation Commissioner Bob Alvarado asking that the remainder of California’s committed port development funds be suspended “until the problem can be reviewed.” She describes the TLS effort to develop a coal terminal in her district as one that would “harm the air quality, health and safety of West Oakland residents,” and goes on to say in her commission appeal that California must “consider the broader impacts of what we do; exporting Utah coal through California would undermine the many forward-looking climate change and environmental policies adopted by our state.”

Today Herbert countered, “If [California] greeted us on I-15… with a barrier and said, ‘you can’t bring your product into the state of California,’ we’d have some concerns about that,” he said, “I don’t see that as any different as shipping from one of the ports located in California. It’s not just Utah, it’s Wyoming and other states that say we have a legal right to ship our product.” Governor Herbert was formerly a chairman of the Western Governor’s Association and now heads the National Governor’s Association.

Acknowledging a growing body of climate science as was done recently by the Department of Defense and the concerns articulated during last year’s Paris Climate Conference talks (which Senator Hancock attended), Governor Herbert said, “I understand those that are concerned about climate change and global warming; we all ought to gather together and say that we ought to have clean air and clean water, but to ban a product with an extraction process that’s becoming much cleaner…we ought to ban in California, which has a lot worse air than we do here, we ought to ban [their] automobile sales.”

“Clean Coal” Concerns

Claims of “clean coal” by Western states rich in fossil fuel resources are not always found to be reliable. According to David Tabet, a scientist with the Utah Geological Survey, the British Thermal Unit content of western coal can vary depending on exactly where it comes from underground. Within the past year, some of Utah’s mining operations have had difficulty delivering coal with enough BTU content to satisfy the requirements of domestic markets. Now western suppliers may be attempting to access Pacific Rim markets where international customers are using older combustion generating technologies and without as much concern for efficiencies or fly ash waste. Current information from the UGS is still being compiled.

Utah’s authorization for funds supporting the planned coal depot in Oakland is expected to be finalized by Thursday, March 10 at midnight when the state legislature completes its 2017 budget allocations and adjourns for the year.

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