Robert Murray, center, chairman of Cleveland-based Murray Energy Corp., embraces two miners in ... [+]
The bankruptcy of the nation’s largest private coal company dovetails with the birth of the New Energy Economy — the rise of cleaner energies that are also cost competitive. Murray Energy and its founder, Robert Murray, have been a strong advocate for coal. But their voices have been quieted by an even more powerful presence: free market forces.
Renewables had long been the energy sector’s step-child, unable to crack markets or to threaten the more established fuels. But consumer demand, public policies and new technologies have combined to motivate private investors. Alternative energies are now the norm, having achieved size, scale and price parity with coal. And even the age-old argument — that wind and sun power are unreliable — has been overcome by the development of battery storage and microgrids.
“It is a business transformation,” says Robert Threlkeld, global manager for renewable energy at General Motors, in an interview. “Customers decide when they will use clean energy resources — not just wind and solar but also demand response and energy efficiency. It is a comprehensive solution.”
Indeed, corporate America is choosing to go green because it is good for the bottom line while also building their brands. In the case of GM, it is procuring renewable energy by installing on site generation as well as by buying clean energy through power purchase agreements and directly from utilities.
Right now, 48% of the Fortune 500 and 63% of the Fortune 100 are vowing to cut their greenhouse gases by increasing their use of green energy and improving their energy efficiencies, according to David Gardiner and Associates. Despite current federal policies, the Renewable Energy Buyers Alliance says that corporate America signed 6,500 megawatts of renewable energy contracts in 2018.
The coal industry has suffered as a result of that transition. No U.S. utilities are building any coal-fired power plants and even U.S coal exports have fallen 28% from a year ago, says the U.S. Energy Information Administration. It also expects that coal’s share of the electric generation portfolio will keep falling: it was 28% in 2018 but that has now dipped to 25% and next year, it is expected to be 22%. Wind and solar made up 21% and 16%, respectively, in 2018.
Symbolic Shift
Clean energy, wind power and photovoltaic power generation, and energy-efficient light bulbs to ... [+]
Murray Energy was unable to meet its obligations, although the company will continue to operate in a different form: it now produces 76 millions of bituminous coal a year and it employees 7,000 people.
The coal company’s downfall is the eighth since 2017. And in the summer of 2019, Revelation Energy and its affiliate Blackjewel filed for bankruptcy protection along with Cambrian Coal and Cloud Peak Energy. Unlike the others, founder Bob Murray had a teacher-student relationship with the U.S. president.
In 2016, presidential candidate Donald Trump tapped into a palpable economic anxiety and vowed to return the coal sector and its employees to the top of the energy hierarchy. Those promises, of course, have not come true. And for a while, coal executives and their labor unions were unified. The bankruptcies, though, have created a rift between the two:
“Now comes the part where workers and their families pay the price for corporate decision-making and governmental actions. Murray will file a motion in bankruptcy court to throw out its collective bargaining agreement with the union,” says United Mine Workers President Cecil Roberts. “It will seek to be relieved of its obligations to retirees, their dependents and widows. We have seen this sad act too many times before.”
The significance of Murray’s bankruptcy filing is twofold: it is symbolic of the shift to green energy and it signals that the working class may be disillusioned with Trump along with his divisive and empty rhetoric. According to the 2019 Clean Jobs America Analysis that is authored by the business group E2, nearly every state saw an increase in green jobs in 2018: 110,000 new jobs and a growth rate of 3.6%. There were 3.26 million such jobs in all that year compared to 1.17 million for all fossil fuel-related jobs.
“Coal mining will continue to diminish in the United States as cheaper renewable energy resources increasingly replace coal-fired power plants,” notes Mary Anne Hitt, a director of the Sierra Club. “As this transition continues, its past time for state and federal lawmakers to take action to protect the miners and communities that have long shouldered the industry's burdens by supporting pensions and investing in a more diverse and robust economy, not bailing out political donors."
Robert Murray, who is an octogenarian and who led Murray Energy for decades, deserves credit for helping to industrialize the United States and for bringing prosperity to millions. And while Mr. Murray has every right to fight hard for his industry and to petition his government, those efforts have been overwhelmed by changing times and shifting winds: we are living in the age of solar-powered homes connected to battery storage devices and microgrids. It’s a new day, and time to spotlight Tesla and other 21st Century enterprises.
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