Coal isn’t getting enough respect, study says
by John Stang
The site of the proposed Gateway Pacific Terminal Credit: Courtesy of Gateway Pacific Terminal
The economic benefits of expanding Washington's coal ports are being underestimated, a Western Washington University professor's report said.
However, the study did not provide specific estimates on costs and economic benefits. Instead, the study analyzed other reports and presented general conclusions.
The Washington Farm Bureau, which supports developing the coal ports, commissioned the study and report by Steven Globerman, professor of international business at Western Washington University. The Farm Bureau unveiled the report Monday.
The report concluded that expanding coal ports would lower costs to other shippers such as farmers because they could use the infrastructure for coal ports for other exports. Farm products are Washington's second largest export industry at $11.4 billion in 2011 compared to coal and petroleum exports at No. 3 with $3.7 billion. Transportation equipment — largely Boeing airplanes — was No. 1 in 2011 at $28.1 billion, the report said.
The report also concluded that the economic benefits from the proposed coal terminals likely have been significantly underestimated.
The exportation of coal to China and other Asian nations has grown in controversy in the Pacific Northwest. One concern is that burning coal contributes to global warming and air pollution. Another concern is numerous, long coal trains routinely stopping traffic at railroad crossings for significant periods of time. Another worry is coal dust wafting from those trains.
Gov. Jay Inslee wants to study both the environmental and economic effect of coal ports and trains before deciding whether to support or oppose the concept. He has strong environmentalist beliefs, including wanting Washington to lead the struggle against global warming.
Washington and Oregon have three coal export terminal projects under consideration. These are Gateway Pacific near Bellingham, which could export up to 52.9 million tons per year; Millennium Bulk Terminals in Longview, which could export up to 48.5million tons per year; and Ambre Energy's Morrow Pacific project at Boardman, Ore., which could export up to 8.8 million tons a year.
Globerman's report said the extra infrastructure, the construction-related employment, plus the economic ripple effects from the proposed terminals would constitute an economic boon.
"While this study does not offer quantitative estimates of the economic effects of lower transportation costs on the Washington state economy, it argues that these effects are likely to be substantial and fairly widespread throughout the state's economy," Globerman wrote in the report.
His report said previous economic impact studies on the proposals have failed to take into account either short-term or long-term "catalytic" effects from increased trade the coal ports would create. He said it's impossible to quantify those effects but they generally involve efficiencies that would help workers' wages and businesses' profits.
His report does not address environmental issues.
John Stuhlmiller, CEO of the Washington Farm Bureau, said, "Dr. Globerman's report demonstrates what we believe to be true. We're very concerned that we not lose access to (overseas) markets."
Stuhlmiller, Senate Republican Caucus Leader Mark Schoesler, R-Ritzville, and Rep. Brian Blake, D-Aberdeen and chairman of the Washington House Agriculture and Natural Resources Committee, voiced concerns about potential changes in coal train-related laws rippling into and handicapping the rail transportation and port exportation of farm products.
"Businesses should know that the goal line is not going to move on them," Blake said. Schoesler added: 'The terminals are our lifeblood in getting (products) to our trading partners."
Schoesler does not anticipate legislation being introduced in 2014 to specifically address coal trains. He said sales taxes from the coal ports would be a revenue boost to the state's 2015-2017 budget.
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