LOUISVILLE, Ky.—Arch Coal will lay off more than 500 miners in the struggling coalfields of eastern Kentucky, a coal industry executive said Thursday, in the latest setback for an industry increasingly being pushed aside as utilities switch to cleaner and cheaper alternatives.
Bill Bissett, president of the Kentucky Coal Association, said he was informed of the layoffs by an Arch executive. Arch spokeswoman Kim Link said the company planned a late-afternoon announcement, but she would not comment further. The St. Louis-based company describes itself on its website as one of the world’s top five coal producers.
In layoff notices sent to the state this week, Arch cited a “continuing decline in demand for steam coal in the central Appalachian market” for its decision to idle several Kentucky mines effective Aug. 20.
“We regret this action; however, it is a necessary step that we are forced to take in response to a difficult business environment,” the company said in the notices dated Wednesday that were sent to the state’s Office of Employment and Training.
The layoffs at the largest mining operations will occur in stages, the company said. Laid-off employees can apply for vacant positions in Arch, but there’s no guarantee they’ll be chosen.
“No ‘bumping rights’ exist at the mine, and these terminations are expected to be permanent,” the company said in the notice.
Harlan County Judge-Executive Joe Grieshop said the coal industry is reeling from stricter government regulations.
“It appears to be quite a battle that is very difficult for us to win in the coal-producing counties,” he said in a telephone interview. “This is probably the most severe blow ever dealt to the coal industry.”
A pair of clean air rules enacted by the Environmental Protection Agency over the past year tightens limits on power-plant emissions of sulfur dioxide and nitrogen dioxide, and place new limits on mercury, a poison found in coal.
In what could be an even bigger environmental blow to coal, the EPA in March issued guidelines that could limit greenhouse gas emissions from new power plants as early as 2013.
In Kentucky, Perry County Judge-Executive Denny Ray Noble said he was told by an Arch executive that the layoffs will hit his county. He said the southeastern Kentucky county has lost nearly one-third of its mining jobs in the last year.
“This is just a start, I think,” he said in a phone interview.
Grieshop said his county had already lost between 150 and 200 coal jobs in the last year before Arch’s announcement.
He said remaining coal jobs now number fewer than 1,000 in the county where thousands once toiled in the mines. He predicted a bleak outlook for the remaining mines in the county.
Noble said the layoffs are a result of utilities switching to alternative fuels.
The share of U.S. electricity that comes from coal is forecast to fall below 40 percent for the year—the lowest level since the government began collecting this data in 1949. Four years ago, it was 50 percent. By the end of this decade, it is likely to be near 30 percent.
Bissett said layoffs will result in “an incredibly difficult time” for the affected miners and their families.
“Our hearts go out to them and the hope is that new mining activities will occur in the future to allow these folks a good opportunity in eastern Kentucky,” he said.