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New West Daily Roundup for Sept. 26, 2016

Today in New West news: the Powder River Basin coal bust, understanding the Yellowstone River fish kill, and how veteran Boulder tech companies keep up with changing Internetscape.

For most of 2016, the news out of Wyoming’s Powder River Basin has been abysmal. Three of the largest coal companies (including top dog Peabody Energy Corp.) operating in the 300-mile stretch of coal country declared bankruptcy this year, shedding hundreds of jobs.

According to Matt Preston, a research director at consulting firm Wood Mackenzie Ltd., speaking to Bloomberg News, “This year is a total collapse.” Indeed, in the four decades since Powder’s ascent in the coal industry, there has never been a “real bust,” per Preston. Indeed, the Powder River Basin was going strong even as its main competitor—Appalachia—was reeling from a terminal bust as early as 2011, prompting coal workers to flock to the tech sector. From Bloomberg:

The changes “have caused folks to think about ‘Economy 2.0’ and how do we get there, conversations that I’ve never actually had in Wyoming,” said Shannon Anderson, a lawyer for the Powder River Basin Resource Council, a community organizing group. “People are starting to think about it in a way that I think folks have never thought of it before.”

For Anderson, the issue came into sharp focus in the spring, she said, as she drove north of Gillette, the hub of the coal region. At one spot, she expected to see a sight that had been a standard for a generation in the area: freight trains lined up, laden with coal. Instead, “there wasn’t a single train,” she recalled. “It was somewhat shocking.”


Coal has a long history in the Powder River Basin. With Appalachian coal closer to the big city populations of the northeast, though, the region early on mostly served its surrounding area.

That changed in the 1970s, when approval of the Clean Air Act combined with cheaper shipping rates from railroad deregulation to smooth the way to eastern markets. Before long, power plants as far away as Georgia were deciding whether to install expensive “scrubbers” to reduce sulfur dioxide under the new clean-air rules, or buy the Powder River Basin’s suddenly cheaper low-sulfur coal. Production soared.

The basin offers two key advantages. Having developed under fresh-water conditions dating to the age of dinosaurs, the basin’s coal has a sulfur content that’s less than a fourth of the variety that formed even earlier beneath salt water in much of competing Appalachia and Illinois.

Secondly, while the region’s coal has less carbon per ton than Appalachia’s product, forcing plants to burn 50 percent more to generate the same electricity, it makes up for that with its sheer abundance. The coal is located close to the surface, eliminating the need for deep mines. Instead, the region depends on cheaper open-pit mining, using hulking excavators.

Companies still operating in the Basin, such as Cloud Peak Energy Inc., are responding to the bust by trimming expenses, letting go of employees, and cutting ties with utility customers who are buying out of coal contracts, utilities, in turn, are looking to their coal stockpile and monitoring natural gas prices. According to Bloomberg, U.S. utilities have over three months of coal stockpiled; however, when that stockpile is reduced, utilities may not be able to obtain more coal fast enough from the Powder River Basin.

The Obama administration’s Clean Power Plan could also cut away Powder’s advantage—its low sulfur content. Although the Plan is currently on hold, power plants have responded to the plan and have started implementing some of its regulations and requirements, including scrubbers to remove the pollutants that made Appalachian coal less desirable than Powder’s “cleaner” coal.

Up in Montana, state biologists have started studying how the Yellowstone River fish kill affected both the fish population and overall river health. Montana FWP closed 183 miles of the river after thousands of whitefish were felled by a microscopic parasite closely related to jellyfish. With the closure ceased, according to the Bozeman Daily Chronicle, residents and recreationists are looking to the agency to explain just what happened:

“What I’d like to see is FWP answer the question of to what extent is the population damaged,” said Pat Byorth, the director of Trout Unlimited’s Montana Water Project.

Throughout the fish kill, FWP officials said they assumed they were only seeing about 10 percent of all the dead fish, if that. Agency staff saw more than 4,000 dead whitefish and a handful of trout, but they didn’t see the ones that floated ahead of them, or that sunk to the bottom. FWP’s regional fisheries manager Travis Horton has said he expects the impact to the population to be fairly significant, but it’s going to be hard for them to answer how significant it is.

They won’t be able to offer a grand total of dead fish, but they can try to figure out what the population looks like. With trout, some of which were affected by the parasite, they will be able to compare population numbers from next spring to numbers gathered this past spring.

But with whitefish, that’s going to be a lot tougher. Data on the species is far more scarce. They aren’t exactly sure what the Yellowstone River’s whitefish population looked like before the fish kill.

“Ideally we’d like to have a quality estimate that we could go and look at,” Horton said. “But we don’t have that.”

Indeed, whitefish in the Yellowstone River have always played second fiddle to the trout—so much so that the agency hasn’t conducted a sample of the whitefish population since 2003. And said samples were marred by inaccuracies and overestimations. Nonetheless, whitefish are essential for understanding fish health in the river as a whole. Some biologists describe them as the “canary in the coal mine,” especially as biologists compare the Yellowstone River fish kill to the one that’s beset Idaho’s Snake River for several years.

Finally, down in Colorado, according to the Boulder Daily Camera, veteran tech firms EarthNet and Indra have been following changes in the Internet for over 20 years. Indeed, the firms were among the first to push for dial-up Internet access to Boulder, providing customers with access and other services, such as email. Some still use their email addresses. Nonetheless, despite being “in lock-step” with the industry all this time, both firms admit they’re at a slight disadvantage. Working apart, that is. From the Camera:

EarthNet has moved almost exclusively into the data center business, offering local companies easy access to the cloud and to servers they can physically “park” at EarthNet’s center.

In yet another transition, EarthNet announced last week that it has acquired Indra’s colocation and DSL business.

“We had a small group of colocation customers,” [Indra CTO Spike] Illacqua said, “but not enough to be profitable.”

What’s next for these two vintage firms who have proven adept at harnessing everything cutting edge is anyone’s guess.

But as they’ve done from the beginning, each is looking for the next new thing.

About Sean Reichard

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