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Legislature ends special session, subsidizes coal-fired power plant

By Staff | Aug 2, 2019

On July 23, the Legislature finally ended the Special Session (originally to be just on K-12 education) that began on March 9, the day the Regular Session ended.

The final act was passage of a bill to give a taxpayer subsidy of $12 million per year to a coal-fired electric power plant in Pleasants County. The proposal appeared suddenly, five days before it was voted on, and wasn’t in written form until two days before the vote.

About 160 people work at the plant, and we were told that all those jobs were suddenly in jeopardy.

I struggled with the issue. I don’t want any of those workers to lose their jobs. But the more I learned, the more suspicious I became. I voted “no.”

The plant went into bankruptcy earlier this year, and agreed to close in 2022. I believe it will close by then, even with this taxpayer subsidy. If I’m right, this is corporate welfare.

Two hundred eighty-nine coal-fired electric power plants have closed since 2010, including 51 that have closed since President Donald Trump took office. They have closed, not because of environmental regulations, but because electricity derived from natural gas and from renewable energy sources is less expensive than electricity derived from coal.

There was some discussion of climate change during the debate on the bill. Delegate Evan Hansen (D-Monongalia), who opposed the bill, pointed out that the plant produces 2.5 tons of carbon dioxide for every ton of coal burned. Delegate S. Marshall Wilson (R-Berkeley) disputed that, referring to the “mythological pseudo-science of man-made climate change.”

I believe that the climate is changing, and that human activity is a significant part of that change. But I think the most important point is that this plant is on its last legs because of market forces. It surprises me that many “conservatives” in our Legislature ignored that.

Another concern is something legislators were not informed of until after the vote — Bluestone Energy, a coal company owned by Governor Jim Justice, is suing the owner of this power plant for $3 million.

To me, this action by the Legislature is similar to its action this past March to reduce the severance tax on coal by $60 million, and by the decision a year ago to give a $40 million tax break to Rockwool to help them build a coal-fired factory right next door to North Jefferson Elementary School. All three actions constitute, in my view, corporate socialism.

Taxpayers are subsidizing this power plant, via excusing it from the Business and Occupation tax. Some argue that this is not a fair tax. We could eliminate that tax on everyone who pays it, by raising the corporate income tax enough to replace the lost Business and Occupation revenue. Or we could replace the Business and Occupation tax with a corresponding increase in the severance tax, thereby shifting the burden from the generation of power to the extraction of minerals. The latter would reduce taxes on West Virginians.