At a lease sale today in Wyoming of taxpayer-owned coal, the single and winning bid was about $1.10 a ton. That’s dirt-cheap. Or actually, I should say it’s cheaper than dirt. According to costhelper.com, and ask.com, a ton of dirt costs between $8-$30 a cubic yard, and a cubic yard weighs between 2,000 and 2,700 pounds.
Yet the largest privately-held coal company in the world, St. Louis-based Peabody Energy, was able to pick up 721 million tons of coal for about $1.10 a ton today under a scandalous lease program operated by the Department of Interior’s Bureau of Land Management (BLM), at cost of $1.2 billion in lost taxpayer revenue (see below). This is supposedly ‘fair market value,’ according to the BLM. However, these taxpayer-owned assets now sell on the open market in the United States for between $8-$14 a ton, and between $80-$122 a ton overseas.
That’s a scam, a giveaway to Big Coal by the federal government at taxpayer expense in a time of very tight economic belts.
It’s also particularly disturbing coming only four days after The Washington Post ran an exclusive story highlighting how this government program has cost state and federal taxpayers nearly $30 billion dollars over the last 30 years. The story is based on a report issued by the Institute for Energy Economics and Financial Analysis (IEEFA).
You can read my blog about it here. The BLM says its program is fair, yet the Department of Interior’s (BLM is part of Interior) office of the Inspector General just opened an investigation into the program, and the Government Accountability Office has two going.
According to a press release from IEEFA issued today about Thursday's lease sale:
Competitive" Bid Process With Only One Company Underscores Deep Flaws in BLM "Giveaway" Process; Approved Price for U.S.-Owned Coal Well Under Half of Fair Market Value.
U.S. taxpayers will lose an estimated $1.2 billion now that the federal Bureau of Land Management (BLM) has reportedly accepted Thursday's bid from Peabody for 721 tons of federally owned Powder River Basin (PRB) coal, according to preliminary calculations announced today by the Institute for Energy Economics and Financial Analysis (IEEFA).
The BLM lease came just days after IEEFA released a major new report "The Great Giveaway: An Analysis of The United States' Long-Term Trend of Selling Federally Owned Coal for Less Than Fair Market Value" available online at http://www.ieefa.org.
Go figure.