‘What do we do about carbon?’ Wyo. governor on coal, climate

Source: By Benjamin Storrow, E&E News reporter • Posted: Friday, February 15, 2019

Wyoming is America’s least populous state, but it has an outsized influence on U.S. energy and climate policy.

It’s the country’s leading coal producer, and it’s in the top 10 for oil and gas production. The state’s renewable potential is also immense, illustrated by Anschutz Corp.’s proposed 3,000-megawatt wind farm in the southern part of the state.

All of which makes Mark Gordon one of the most important governors in America. Gordon is a rancher from the northeastern part of the state. He attended Middlebury College in Vermont and was appointed Wyoming’s treasurer in 2012. He won re-election for a full term in 2014.

Gordon, 61, emerged from a crowded primary field of Republican gubernatorial contenders in the fall. His energy and environmental credentials were a contentious topic in the race. He once served as the director of the Sierra Club’s Wyoming chapter. Since hitting the campaign trail last fall, Gordon has stressed his support for the state’s fossil fuel industries.

I covered the energy industry for three years at the Casper Star-Tribune, the state’s largest daily newspaper. And like many Wyoming energy observers, I was eager to learn how Gordon would lead Wyoming: from his perspective as an environmentalist or as a political booster of coal.

The governor offered some clues in an interview earlier this week. In a half-hour phone call, Gordon addressed everything from leading a fossil fuel-dependent state in an increasingly climate-conscious world to managing coal’s decline to his views on renewable energy.

I think people who aren’t from Wyoming see something like coal mining or oil and gas development as being in conflict with conservation or preservation. And people in Wyoming often care deeply about both of those things. How do you balance those things?

I think that the average coal miner wants to have a job, but they also love being able to go hunt, and I don’t think that there’s necessarily a conflict there. There’s certainly been battlegrounds in the past over issues like coalbed methane and things like that. But you look at something like this Thunder Basin Grassland Prairie Ecosystem alliance — that’s a mouthful — that’s a group of ranchers and oil and gas folk, [nongovernmental organizations] and coal that have gotten together to talk about protecting the sage grouse. And there’s real desire to maintain the kind of landscape and other things.

So I think that there is a desire in Wyoming to try to do the best by both, and the fact it’s kind of a sweet spot, just to sort of pivot a little bit, that’s sort of the sweet spot that I’m trying to advance the conversation.

The point I’ve been trying to make consistently has been that we need to advance the conversation about energy supply beyond fossil bad, renewable good. What do we do about carbon?

So as you know, [former Republican] Gov. [Matt] Mead, one of his really crowning achievements was getting the integrated test center, the ITC, up and running and then attracting the carbon XPrize. My view is that if you look at the whole equation, Wyoming can really lead the way toward carbon-negative types of projects.

Carbon capture and sequestration [CCS] is a critical technology for the future. Everybody agrees with that. I have known Amory Lovins [co-founder of the Rocky Mountain Institute] since I was 14 years old. As you know, I kind of went through a little bit of a dusting, I guess, from my opponents [during the 2018 gubernatorial primary] because they were unclear about my motivations, whether I was a greenie or not.

I’m fully familiar with all of the arguments for renewables and so on, and I’ll get back to that in a second. But we need to do something about carbon in the atmosphere, and there are technologies that are setting about trying to do that.

One you’ve probably heard about is some sort of giant vacuum cleaner that would suck CO2. If you do that, you still got to sequester it somehow, and you think about those volumes of air you’ve got to move to make a meaningful change. And so in Wyoming, taking something like the Dave Johnston plant just southeast of Casper and inputting something like that, the technology is called VEX.

I’m not familiar with it.

What VEX does is it incorporates a certain amount of biomass with burning coal and then doing carbon capture and sequestration at a concentrated source.

The difference there is you’re actually taking the carbon that biomass has collected and sequestering it. So you now have a carbon-negative project that revamps an almost depreciated asset, and you’re leading the way toward its carbon-negative types of technologies.

And most people come back and say, “Well, CCS doesn’t have commercial viability.” We have to start with something, and I’m old enough to remember in the late ’70s when Boeing was standing up their first wind generating projects south of Medicine Bow [in central Wyoming] and they couldn’t keep blades on it. It takes time to get technologies to market and a certain amount of commitment, and that’s certainly the commitment we showed when we subsidized, you know, gave the tax incentives to wind generation.

Do you need to acknowledge climate change to justify the investment in CCS? Is climate change a problem that Wyoming needs to be solving for?

Yeah. You know, what I’m going to say is we can move technology forward under all circumstances and on a fair playground. I know there are those who would like to argue about climate change, and I guess I’m trying to get past that argument to talk about just technological improvement. Let me just be straight-up about you’ve got technologies in China where they’re capturing carbon off of — it’s not broad-based — they’re still there capturing CO2, and they’re running it through algae tanks and building biofuel from it. These are just good ideas. And they happen to sort of drive us in a carbon-conscious direction. So from my standpoint, this is just pairing technologies and improving technologies.

So getting back to that whole renewables stance: You know, my problem is the way I think our culture goes about solving big issues like climate change. We want to make sure some poor bastard somewhere else doesn’t do whatever it is they’re doing that we see as bad for the world. I don’t know if you watched the Super Bowl. It was a great metaphor for the world we’re building. It was that Budweiser ad where the horses that normally went out in this beautiful stuff suddenly were going out in this terrain that was completely littered with pinwheels.

You’ve probably taken a look at what the concrete component for those towers is, and I’m not sure we have fully appreciated the carbon sunk into those or the metals for the towers or the composites in the blades or any of that stuff. So a net accounting of all that stuff might give us a better way to sort of solve for these issues.

That raises the question of how you see the role of renewables in Wyoming. I mean, you have some really massive projects proposed up there.

Yeah. I think it’s great that we have the projects we do. But you started with a little bit of a conversation about open space. Clearly, it’s one of the other issues that we’ve got to think about. I think there’s a great role for renewables going forward. We’re starting to see some solar projects that are showing up.

One of the things that I’ve been very eager to work on is how do we do the planning for a variety of energy that is going to be generated in Wyoming? So, for instance, if we have a solar project that takes up a section but there’s also oil and gas available there, how do we build the regulatory structure that allows for both to happen, but at the same time also takes into account the wildlife populations and other aspects of that, as well? So I think we’re going to have plenty of work to do.

What I would say is different, and I don’t know exactly how we bring a national policy discussion to this, but it’s certainly one I’m wanting to engage in. When we lease federal minerals, there has been from almost, I think, the ’20s, a notion that a portion of those royalties should accrue back to the state to take things like roads and infrastructure, schools, police, and all the stuff that’s attendant with energy development. And yet when we stood up to the subsidy for wind generation, none of that benefit came to the state, and yet the impact is quite similar.

State Sen. Cale Case was my neighbor when I lived in Lander, and we used to talk all the time about this. He would raise this exact point. It sounds like you share a lot of his thinking about that.

Editor’s note: Case, a Republican, has led efforts in Wyoming to increase taxes on wind generation(Climatewire, Jan. 28).

I think that they’re all things that we should bear in mind. I think you know the general public opinion of renewables at this moment is that they’re completely benign. And there is an impact that should be considered in any equation.

What do you think of the proposals to raise the tax on wind generation?

I think there’s more study that needs to go into what an appropriate tax ought to be. As you know, we have a tax, so I see no reason to take that tax off. And I’m fully supportive of looking at what the tax consequences might be for a different tax policy. In fact, you may know that Gov. Mead had a group he called ENDOW — that is, “economically needed diversification options for Wyoming.”

I’ve met with them, and one of the things that I’d like them to try to explore is a variety of taxes going into the future, just to your point. So if we see more renewables, what is their contribution going to be? If we see a decline in coal, we know that. What does that mean? I want the people of Wyoming to have a full understanding of what that tax schedule means so that we can have a robust conversation about where Wyoming needs to be five, six years out.

You mentioned the decline of coal. Peabody Energy said it would reduce production at North Antelope Rochelle by 10 percent in 2019. How does Wyoming plan for that?

Editor’s note: North Antelope Rochelle, in Wyoming’s Powder River Basin, is America’s largest coal mine.

Right. Well, that’s exactly the point that we’ve been talking about. It is declining. We know that. You can see that in Peabody; you can see that in general production. We haven’t seen new leasing; there’s a lot of issues related to that.

So I think that’s going to be one of the premier challenges for Wyoming and for my administration is how do we pivot so that we do continue to have a strong economy and move beyond that just being [an energy] colony to being a center for technology, and I’m talking about energy types of technologies. How do we capitalize on the fact that we were the first state to really get the policy framework correct for fossil carbon capture and sequestration? How can we advance burner technologies?

It’s being done around the world. We’ve talked a little bit about China, but [South] Korea and Japan both have advanced fleets that if we could actually export some Powder River coal to places like Japan, reduce carbon emissions, I think it’s good. Our challenge is going to be, how do we become thought leaders in the energy mix? And I guess I feel that we can do that.

This interview has been edited for clarity.