Waiting for Coal’s Next Act

Even if one allows that the coal industry solves outstanding issues with carbon capture and sequestration – and it might - the rising tide of nuclear and renewable energy sources can make the coal industry look, fairly or unfairly, retrograde and outmoded. Although coal has made out pretty well in energy legislation so far, the industry clearly feels vulnerable, which leads to things like this:

The chief executive of coal mining giant Massey Energy blasted supporters of climate-change legislation and other environmental issues affecting the coal industry at a free Labor Day concert and rally in southern West Virginia.

CEO Don Blankenship said he wanted to show people at the event how government regulation is hurting the coal industry, driving up energy prices and making the country less competitive.

Well, Blankenship has to say something, and these are arguable points.

But then:

Headlining the event were Fox News personality Sean Hannity and [Hank] Williams [Jr.], while rocker Ted Nugent served as master of ceremonies and played briefly.

Sean Hannity? Ted Nugent? Uh-oh.

"Barack Obama hates the coal industry. Barack Obama hates the oil industry," Hannity said. "If they shut down the coal industry, we lose America as we know it."

You can see the whole speech on YouTube.

Massey seems have taken politically neutral situations – concern about jobs, the long tradition of coal in West Virginia – and melded them with a highly politicized message.

Massey’s employees and other concert attendees likely range from across the political spectrum (McCain took West Virginia last year 56-43, but that’s still a lot of Obama voters). Coal doesn’t care who mines it, so a 10-minute screed against the Obama administration seems off-point.

Massey should be for something, encouraging people to militate for coal on its virtues – as a lot of Congressional figures and others have done - not solely against those who are for something else. Massey’s tactic seems to start with the premise that coal is indefensible unless all alternatives are obliterated, likely not the message it wants to project. When Blankenship says:

"In Washington, they sometimes say that those of us in Appalachia need help because we're not very smart. Well, we're smart enough to know that only God can change the earth's temperature - not Al Gore."

Massey may as well say it has lost the argument on points and must now depend on Sean Hannity’s brand of demagoguery to hold together the tattered remnants. It just isn’t so – or necessary.

Now, we’re all in favor of people getting just as political as they want in order to make a point – we thought USEC got this about right a few weeks ago – but Massey could have used its rally to focus on jobs and the value of coal. We can imagine a lot of concert goers tuning out while waiting for the next act to come on.

Hank Williams Jr.

Fluor Invests in NuScale

You know, it’s kind of sad that no one is willing to invest in nuclear energy anymore. Wait, what? NuScale Power celebrated the news of its company-saving $30 million investment from Fluor Corp. Thursday morning with a press conference in Washington, D.C. Fluor is a design, engineering and construction company involved with some 20 plants in the 70s and 80s, but it has not held interest in a nuclear energy company until now. Fluor, which has deep roots in the nuclear industry, is betting big on small-scale nuclear energy with its NuScale investment. "It's become a serious contender in the last decade or so," John Hopkins, [Fluor’s group president in charge of new ventures], said. And that brings us to NuScale, which had run into some dark days – maybe not as dark as, say, Solyndra, but dire enough : Earlier this year, the Securities Exchange Commission filed an action against NuScale's lead investor, The Michael Kenwood Group. The firm "misap...

Wednesday Update

From NEI’s Japan micro-site: NRC, Industry Concur on Many Post-Fukushima Actions Industry/Regulatory/Political Issues • There is a “great deal of alignment” between the U.S. Nuclear Regulatory Commission and the industry on initial steps to take at America’s nuclear energy facilities in response to the nuclear accident in Japan, Charles Pardee, the chief operating officer of Exelon Generation Co., said at an agency briefing today. The briefing gave stakeholders an opportunity to discuss staff recommendations for near-term actions the agency may take at U.S. facilities. PowerPoint slides from the meeting are on the NRC website. • The International Atomic Energy Agency board has approved a plan that calls for inspectors to evaluate reactor safety at nuclear energy facilities every three years. Governments may opt out of having their country’s facilities inspected. Also approved were plans to maintain a rapid response team of experts ready to assist facility operators recoverin...

Nuclear Utility Moves Up in Credit Ratings, Bank is "Comfortable with Nuclear Strategy"

Some positive signs that nuclear utilities can continue to receive positive ratings even while they finance new nuclear plants for the first time in decades: Wells Fargo upgrades SCANA to Outperform from Market Perform Wells analyst says, "YTD, SCG shares have underperformed the Regulated Electrics (total return +2% vs. +9%). Shares trade at 11.3X our 10E EPS, a modest discount to the peer group median of 11.8X. We view the valuation as attractive given a comparatively constructive regulatory environment and potential for above-average long-term EPS growth prospects ... Comfortable with Nuclear Strategy. SCG plans to participate in the development of two regulated nuclear units at a cost of $6.3B, raising legitimate concerns regarding financing and construction. We have carefully considered the risks and are comfortable with SCG’s strategy based on a highly constructive political & regulatory environment, manageable financing needs stretched out over 10 years, strong partners...

NEI Nuclear Notes

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