How’s this for news: An agency partially funded by coal has set up an incentive program to try to attract renewable energy firms to Southwest Virginia.
Yes, you read that right. The world is a more complicated —and far more interesting — place than some bumper-sticker slogans would lead you to believe.
The Virginia Coalfield Economic Development Authority hasn’t just set up a Renewable Energy Fund, it’s using coal tax credits to do so. For fiscal year 2020, the authority received $853,112 in coal tax credits — about 20% of its budget. The new Renewable Energy Fund is set at $1 million, which means the authority is using more than a year’s worth of coal tax funding to try to lure green energy companies to the coalfields.
This is significant on many levels.
First, the stereotype of the coal counties clinging to a dying industry is wrong, and this is but the latest example. The Republican legislators from that region deserve more credit than they’ve gotten for trying to lead the region in a different direction. They’ve established the Southwest Virginia Energy Research and Development Authority, with a goal of trying to make a region that once was an energy capital for an old form of energy into an energy capital for new forms of energy. They’ve tried to persuade Dominion Energy to locate a pumped storage hydroelectric project in the region. They’ve established InvestSWVA, an economic development group that has set out to create connections with the technology community in Northern Virginia. Building a new economy is a generational process, but that process has begun. This move by the region’s main economic development agency is but a piece of that larger effort, but a significant one because it constitutes an official recognition of where the economy is headed — more and more companies are demanding renewable energy, which means if you don’t have any to offer you’re not really in the game. Plus, in many ways, coal country is uniquely suited to become green energy country for reasons we’ll talk about later.
Second, let’s talk about those state funds — specifically coal tax credits. Some Democrats have been trying to eliminate those for years. When Terry McAuliffe was governor, he tried and failed. Democrats got a new talking point in September when the General Assembly’s auditing arm, the Joint Legislative Audit and Review Commission, produced a report that concluded the coal tax credit actually costs the state more jobs than it saves. A vote against the coal tax credit is an easy vote for Democrats: Why would they want to prop up a fossil fuel industry that’s in decline anyway?
Now here comes a twist: Some of those coal tax credits are now being used to promote renewable energy. Is this some clever maneuvering to try to save those credits? Maybe. But it also underscores an inconvenient point for Democrats who want to mount a new challenge to those tax credits: Southwest Virginia doesn’t exactly have a lot of tools to work with. Some of those tax credits are, by law, directed to the Virginia Coalfield Economic Development Authority. If the General Assembly abolishes the coal tax credits, will it come up with some other way to fund economic development in the region? That’s probably one of those questions that answers itself. Democrats hate it every time we say this but we’ll keep saying it because it’s true: The party has shown scant interest in helping Southwest Virginia build a new economy.
Politically, we understand that: There are few votes available for Democrats in that part of the state. Still, you’d think a party that makes social justice and economic justice key parts of its identity would be more interested in a part of Virginia that suffers a deficit of both. The past two years, state Sen. Bill Stanley, R-Franklin County, has proposed a bond issue for school construction — some of the textbook examples of dilapidated schools are in Southwest Virginia — and not a single Democrat has voted in favor. Ditto his proposed constitutional amendment to mandate “equal educational opportunities.” When did Democrats become the party that’s maintaining school disparity? When he was running for governor, Ralph Northam proposed turning the University of Virginia’s College at Wise into a research university with emphasis on research into renewable energy. We thought that was a foresighted idea — it’s also one we haven’t heard mentioned since.
One of the signature achievements of the new Democratic majority in the General Assembly is the Clean Economy Act, which requires Dominion Energy Virginia to be 100% carbon-free by 2045 and Appalachian Power to be 100% carbon-free by 2050. That’s good for the climate, but not good for coal — or the part of the state where coal has been a key part of the economy. That’s not an argument to keep burning coal but it should be an argument to figure out how to build a new economy in that part of the state. Instead, the Clean Economy Act offers no such thing — just some vague language about how utilities should give priority to “historically economically disadvantaged communities” when building new facilities and how certain monies should be directed to “job training programs in historically economically disadvantaged communities.” All that sounds nice, but doesn’t really do anything. Job training programs don’t do much good if there aren’t jobs to be trained for in the first place.
With this Renewable Energy Fund, we see an agency in the coal counties taking some concrete steps. For instance, the authority has been targeting companies making batteries for electric cars. “Our region actually has a long history in battery technology and electrification, because batteries and electrical components are used extensively in the mining industry,” says Jonathan Belcher, the authority’s executive director. That’s a creative way to leverage the region’s assets to transition from one era to another. Environmentalists are right that renewable energy is creating a lot of new jobs; the trick is to see if some of them can be directed to the communities losing fossil fuel jobs. If so, that would be the true Green New Deal. Ironically, here it might be funded by coal.