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MATS compliance strategies

James River Coal Files Ch.11; Blames Regulations, Nat Gas

MATS compliance strategiesMining company James River Coal has filed for Chapter 11 bankruptcy protection, blaming environmental regulations, competition from natural gas, and weak economic conditions, the AP reports.

The Richmond, Va.-based company said it has secured $110 million to keep operations going, pending court approval, while it restructures. James River, which mines coal used for steel production and power generation, is considering selling off parts of its business.

Power generators have been switching from coal to natural gas due to the latter’s low prices, and because of increasing regulation of coal-fired power.

In 2012, 85 coal-fired plants were retired, compared to 31 in 2011 and 29 in 2010.

The cost of equipment needed to comply with the EPA’s Mercury and Air Toxics Standards plays a significant role in coal plant operators’ retrofitting and retirement decisions, according to the Energy Information Administration. MATS requires that coal-fired power plants incorporate the maximum achievable control technologies to control acid gas, toxic metal and mercury emissions by April 2015.

At the end of 2012, 70% of US coal generating capacity already had the appropriate environmental control equipment to comply with MATS, and another 6% planned to add control equipment, but 8% announced plans to retire.

The remaining 16% still must make a decision on whether to upgrade or retire, the EIA says.

The EPA’s carbon standards for existing power plants, due in June, could pose another challenge for coal-fired generation. The White House is currently reviewing the EPA’s proposal.

Other regulations faced by coal plants include rules on fly ash, cooling water intake, wastewater controls, National Ambient Air Quality Standards and the Cross-State Air Pollution Rule.

Takeaway: A coal-mining company has filed Chapter 11, citing regulations, economic conditions and competition from natural gas.

Tamar Wilner is Senior Editor at Environmental Leader PRO.

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