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Bay area owners feel heat of distant coal operations

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By ROBERT TRIGAUX, Times Business Columnist

© St. Petersburg Times
published August 16, 2002


Sure, Tampa Bay businesses are well known for their expertise with retirees and tourists. But coal mining?

Strange as it seems, Tampa's TECO Energy and Walter Industries, and St. Petersburg's Florida Power (now part of North Carolina's Progress Energy Corp.) all own coal mining and transportation subsidiaries that make them part of the powerful interests known as Big Coal.

Now all three companies are suffering legal and publicity backlashes from their distant coal operations.

Locally, none of these businesses bother to hype their coal holdings. The mining industry is rough, dangerous and environmentally disruptive. And, frankly, not a big part of the strategic futures at any of the three companies.

All of the coal industry's nastiness conveniently takes place out of sight, far from Florida's tranquil gulf coast, in such rural places as Appalachia. That's where coal mining still offers some of the best paying jobs. And causes some of the greatest pain.

But here's a look at what our Tampa Bay companies are up to in the coal fields:

TECO Energy: In rural Kentucky, the Premier Elkhorn coal business owned by TECO was the subject of a grand jury investigation last summer of its mining practices and operations, which neighbors claim has damaged their homes and health. No charges were brought. But TECO was criticized for failing to help area residents by washing their homes or controlling coal dust.

"Such actions by TECO mining would no doubt be well received by these residents and would go a long way toward improving the negative perception of TECO mining held by these citizens," the grand jury said.

A year later, that negative perception has not changed much. TECO remains the target of angry Kentucky residents in and around the rural town of McRoberts. Their complaint? That TECO's nearby mining business is using a damaging technique named mountaintop removal. By grinding away the tops of hills with earth-shaking blasts and stripping the area of vegetation, they say TECO is increasing the frequency and intensity of local flooding and mudslides.

The Bush administration, eager to increase domestic sources of energy, is a strong supporter of TECO's style of surface strip mining, in which mountaintop ridges are sheared off and the dirt and rock pushed into nearby streams. Legal challenges and local protest groups have slowed the mining practice, but certainly not halted it.

Walter Industries: In Alabama, a coal mine owned by Walter was the site last September of two underground methane gas explosions that took the lives of 13 Alabama coal miners. The Brookwood accident at Blue Creek Mine No. 5, America's deadliest since 1984, has resulted in at least 11 wrongful-death lawsuits against Walter and its coal mining unit, Jim Walter Resources.

Last month, workers began clearing a site adjacent to the mine for a memorial honoring the 13 coal miners. A dedication of the polished black marble memorial is set for Sept. 23, the one-year anniversary of the blast. The mine has reopened, but the government has yet to issue its report on the investigation of what happened.

Progress Energy: In West Virginia, the daughter of a woman killed in an accident involving two coal trucks this month sued Kanawha River Terminals, Florida Power's former coal dock now owned by Progress Energy, where one of the trucks was headed. One grossly overloaded coal truck -- weighing 165,000 pounds, more than twice the legal limit of 73,500 pounds on the state road -- was headed for Progress Energy's coal dock.

That lawsuit alleges Kanawha River Terminals "entered into a joint enterprise with (trucking) companies . . . to truck illegally overloaded coal trucks over the roads of West Virginia for a profit." The Progress Energy subsidiary accepted overweight coal shipments, the suit also alleges, "out of their greed for profits."

All three of these coal-owning companies deny they did anything wrong. Mining and transporting coal are risky businesses. Anybody who has driven winding Appalachian roads or the coal-country interstates can attest to the 24/7 zeal of local coal trucks barreling along just inches from your back bumper.

And all three prefer not to be known for their coal ties.

Walter Industries never really intended to be a player in the coal business. It backed into the ownership of coal mines while expanding as a conglomerate. Now its strategy is to slim down, focus on home building and development, and eventually divest its coal and other unrelated businesses. But few others want to be in the coal business either.

TECO, the parent of Tampa Electric Co., spent most of the 1990s crowing to Wall Street about its heavy use of cheap coal to fire the power plants that produced electricity for Hillsborough County and nearby customers. But TECO has since changed its message, in part because the coal-dependent power company was identified as one of the country's major air polluters.

Progress Energy inherited substantial holdings of coal (including Kanawha River Terminals) when it acquired Florida Power two years ago. So far, Progress Energy has benefited the most from turning coal scraps into a briquet-shaped byproduct called synfuel that allows the company to receive federal tax credits.

Is there a lesson here among the palm trees for our owners of distant coal? Sooner or later, there's a heavy price to pay. Some of those bills are coming due.

-- Robert Trigaux can be reached at trigaux@sptimes.com or (727) 893-8405.

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