Colorado coal production last year fell considerably from the previous year, to the lowest level in decades.
Coal mines produced a total of about 10.3 million tons in 2020, down from more than 13.6 million tons in 2019, according to state Division of Reclamation, Mining and Safety data. That’s the lowest amount of production in the state dating back at least to the late 1970s.
The reduction was driven by production drops at Arch Resources’ West Elk Mine in the North Fork Valley and Peabody Energy’s Foidel Creek Mine in Routt County. Production at West Elk fell to 2.402 million tons last year from about 4.16 million tons the prior year. Foidel Creek’s production fell to about 1.2 million tons from 2.54 million tons in 2019.
West Elk’s employment has dropped from 335 miners to 232 over the course of the year, and Foidel Creek’s has gone from 174 to 116.
Deserado Mine, with 2.405 million tons of production, barely edged out West Elk as the top-producing mine in the state last year. With 163 miners, Deserado, in western Rio Blanco County, supplies coal to the Bonanza power plant just over the Utah border.
The Trapper Mine in Moffat County produced just over 2 million tons last year, and the Colowyo Coal Mine in Moffat County produced 1.74 million tons. Those mines supply the Craig Station power plant in Moffat County. Foidel Creek supplies the Hayden Station plant near that mine.
The King II Mine in La Plata County last year produced about 538,000 tons of coal.
“I think this is no surprise,” Michael Saul, a senior attorney with the Center for Biological Diversity, said of the state production decline in 2020. “I mean, I think everyone who’s being honest with themselves has seen this coming for a long time, that … thermal coal production is in its terminal decline for a variety of reasons.”
Thermal coal is used in electricity generation by power plants. The Craig Station’s three generating units are scheduled to be shut down between 2025 and the end of 2029. The Trapper Mine is expected to close once the first two units shut down. Tri-State Generation and Transmission Association has committed to close Colowyo Mine by 2031 even if it can find other customers for the mine.
The Bonanza plant under a legal settlement has agreed to stop burning coal once it finishes burning 20 million tons during this decade, which it is on pace to do by 2028, said Jeremy Nichols of WildEarth Guardians, a party to that agreement. The plant is Deserado’s only customer, with the coal being shipped there on a dedicated rail line.
The Hayden plant is scheduled to close by 2028, though Peabody could seek other customers for coal from Foidel Creek.
“For northwestern Colorado it’s pretty clear by the end of the decade coal production is going to drop pretty dramatically,” said Stan Dempsey, president of the Colorado Mining Association.
“… It’s really a tragedy to leave behind so much clean, high-BTU Colorado coal that should be utilized for the benefit of the people of Colorado, including tax revenue.”
Dempsey said he would hope alternative uses could be found for thermal coal.
“We would hope that maybe there would be export markets. I mean, I don’t know of any,” he said.
Dempsey said he thinks Arch Resources has indicated a softening in the export market for West Elk Mine coal affected the mine last year.
A recently released state action plan to economically transition coal workers and communities says state coal mine and coal-fired plants paid an estimated $65 million in combined property taxes in 2019 to various jurisdictions.
“I haven’t heard how they’re going to replace that,” Dempsey said.
He said what’s happening is based on choices made as a result of things such as lawsuits, settlements and policies like Colorado’s goals to reduce greenhouse gases.
Saul said coal-fired power is less and less cost-competitive with renewable energy.
“This isn’t new. It’s been going on for a long time,” he said of coal’s decline.
Dempsey said subsidies, like the recent action by Congress to extend a wind-power tax credit, play into renewable power’s cost-competitiveness.
Saul and Nichols said the focus now needs to be on helping miners and communities in the transition from coal. Saul said the days of coal-fired power generation are ending “and it’s time to think about sustainable economic futures for the people and the communities that were built on coal.”