A United States District Court in Montana has ruled that the United States Departmental of the Interior acted illegally when it tried to lift a memorandum on leasing coal on public lands.
One of the biggest subsidies that the United States gives the coal industry is that it leases coal on public lands at below market rates. The rates that it charges for mining on public lands have not been adjusted since the 1980s. The system is full of loopholes and flaws in the way the leasing program is handled that result in lower royalties. The result is that it is cheaper to mine on public land than it is on private land.
As a practical matter, this subsidy is not available in West Virginia. We don’t have much, if any, mining on public land. The West Virginia coal industry does not benefit from getting to mine coal on public land at below market rates.
Out west, quite the opposite is true. Most of the production is from leases on publicly owned land. They benefit from the low price that the United States charges for minerals mined on that land.
Before Mr. Obama left office, his administration had started to fix this. It put a moratorium on new leases. It undertook a study of the whole program of coal leasing on public lands. The study was supposed to look at the whole question of whether we should be mining coal at all on public lands. If fighting climate change is a national goal, then maybe the best thing to do with the coal that the government owns is just leave it in the ground.
If we are going to mine the coal, then the study was supposed to figure out what would be a fair price.
When Mr. Trump became President, things changed. The Department of the Interior cancelled the moratorium on new leases as well as the study of the policy on leasing in the future. It announced a policy of resuming the leasing of coal on public lands.
Now the District Court has put a stop to these changes. It ruled that the Department of the Interior did not perform a sufficient environmental analysis before this change in policy. The analysis would be required by the National Environment Policy Act (NEPA).
The Court did not rule that a full Environmental Impact Statement would be required. It may be that a less rigorous Environmental Assessment is sufficient. It gave the Department of the Interior thirty days to present arguments on what type of environmental assessment it would perform.