Friday, Dec 21, 2012, 2:00 pm
Illinois Coal Bankruptcy: Good News for Environment, Bad News for Workers
Clean-energy advocates cheered this week’s announcement that the parent company of Midwest Generation—which closed two Chicago coal plants in August but operates four more elsewhere in Illinois—is filing for Chapter 11 bankruptcy. But unions representing the coal workers have reason for worry.
Edison Mission Energy said in a statement that the four remaining Illinois plants—in Waukegan, Joliet and Romeoville (all near Chicago) and in downstate Pekin—will continue to operate normally as financial restructuring begins. But energy experts say the filing means some or all of the coal plants will likely close in coming years.
The closing of the final four coal plants would be good news for the environment and for public health. The archaic plants emit high levels of carbon dioxide, which causes global warming, as well as particulate matter, sulfur dioxide and other compounds that cause health problems. But it would be bad news for the plants’ 845 workers, 539 of whom are union members with the IBEW Local 15. They would join the 170 Midwest Generation employees who lost their jobs when the Fisk and Crawford plants in Chicago closed in August.
Edison Mission Energy has debts of $5.1 billion, according to bankruptcy filings, including about $200 million in pension-fund obligations, which will be picked up by Edison International, its parent company.
Statements from Edison Mission Energy and its subsidiary Midwest Generation are vague about the plants’ futures and don’t mention any closings. But the bankruptcy court will determine the plants’ immediate futures. It's expected that by December of 2014, the court will give control of the four plants to the company's creditors, including the utilities ComEd, Peoples Gas and various other companies. The creditors could theoretically keep the plants open, but local experts say that since the plants were losing money when run by Midwest Generation, there is little reason to believe they could be profitable two years down the road when they are even older. And in 2019, the plants will be required, under state and federal law, to install expensive pollution controls.
Midwest Generation’s situation is hardly unique.
Midwestern coal plants have become increasingly unprofitable in recent years due to competition from cheap natural gas-fired power, lower consumer demand for power and requirements to install expensive pollution control equipment. More than a hundred coal-fired power plants have closed in recent years, and many U.S. coal mines have announced mass layoffs. This fall, for example, Alpha Natural Resources announced that it is closing eight coal mines and cutting 1,200 jobs. In mid-December, a southern Illinois mine run by Macoupin Energy announced 65 layoffs. And in November, Murray Energy Corp. announced a total of 156 layoffs at Utah and Illinois mines. (However, coal mining jobs nationwide are actually at a decade high, driven in part by domestic and international demand for higher-quality coal. As ThinkProgress reported, West Virginia—which produces coal of much higher quality and value than the Midwestern Illinois Basin and Powder River Basin—has actually added significant numbers of mining jobs in recent years.)
The fate of the Midwest Generation plants will also hinge on negotiations with labor during bankruptcy proceedings. Greenpeace senior analyst Mike Johnson predicts that any demands for concessions will be "contentious" and "could get them [the owners] hammered by IBEW and IUOE (International Union of Operating Engineers), among others.” IBEW did not return a call for comment about Midwest Generation’s fate.
Leaders of environmental, health and community groups who have long pushed for the coal plants to shut down have also stressed that they are also sympathetic to the plight of workers. As I reported for Midwest Energy News, local environmental activists who live near the Romeoville plant would be glad to see it shut down, but they want Midwest Generation to help the workers secure new employment. Ellen Rendulich, director of the grassroots group Citizens Against Ruining the Environment (CARE), attended Edison International’s annual shareholder meeting in California in April, and said there was much talk regarding the company broadening its investments in renewable energy.
“So they should train these workers in renewable energy and then shut the coal plants down,” she said. “People need jobs. [Edison has] profited off these plants since 1999, now they should be doing something for the community.”
Clean energy advocates say renewable energy and energy efficiency can create many more jobs for working people than fossil fuels.
Studies done by the Environmental Law and Policy Center show that Midwestern states are already home to hundreds of wind power supply chain businesses responsible for tens of thousands of jobs, with the potential for much more job creation. And energy industry leaders note that many renewable energy-related jobs – for example installing solar panels, replacing leaky windows and carrying out energy efficiency audits on homes – require only relatively straightforward and quick training programs especially for workers already skilled in electricity-related fields. That means such jobs can be ideal for retraining laid-off workers. The IBEW, for example, runs an apprenticeship program called “Working Green” in many locations nationwide, specifically aimed at preparing members for renewable energy jobs.
On December 12, speaking at a gala for the nonprofit group Wind on the Wires, former President Bill Clinton described the potential of massive job creation through a re-imagining and reshaping of our energy system to rely more on wind, solar and other forms of renewable energy, along with energy efficiency and a “smart grid.” Manufacturing would be spurred by more investments in renewable energy, while a revamping of our energy systems would entail extensive infrastructure work—creating numerous jobs that could not be outsourced.
Such a major shift will require significant political will. For instance, federal lawmakers would need to extend the Production Tax Credit for wind power, otherwise set to expire this month. Given the power of the fossil fuel industry, this will be a tough row to hoe, as Clinton acknowledged in his speech. But, he said, that’s no reason not to try.
“You all should make a much bigger deal about the contributions you make to the economy,” Clinton told the clean energy advocates in the room, as I reported for Midwest Energy News. “Let’s take workers out of mines and put them in these [renewable energy-related] factories.”
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Kari Lydersen is a Chicago-based reporter, author and journalism instructor, leading the Social Justice & Investigative specialization in the graduate program at Northwestern University. She is the author of Mayor 1%: Rahm Emanuel and the Rise of Chicago’s 99%.
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