There were many warnings that it wasn’t going to be business as usual – that a boom wasn’t going to turn things around. Global trends, research and development, and public opinion pointed toward a future where Wyoming wasn’t positioned to thrive. Most of our eggs remained in the energy basket even as others warned it wouldn’t be as popular or profitable as before, but that was OK because things have to go down before they can rocket back up.
Meanwhile, low energy prices impacted the demand and rate of all fuels. Last year, natural gas surpassed coal as the primary power source of electrical plants. While U.S. crude oil output has reached a record high, the cost of oil is a fraction of the highs it used to demand. Amid low ore prices, uranium producers and nuclear plants are begging for a government bailout. Banks and power companies are reorganizing their investments to include more renewable energy and fewer fossil fuels. There have been five coal bankruptcies in the Powder River Basin, home of some of the best coal deposits. Many competitors crunched the numbers and decided they couldn’t turn a profit on a rescuing bet on Blackjewel, and even now one buyer is tied up by permit complications.
It was tempting to deny or ignore these red flags, because that means we wouldn’t have to make personal changes. Besides, there were plenty of people offering assurances that the downturns were fleeting. Smoke blowers crafted comforting visions, swearing we’d return to the heights of the past.
However, the sobering arrival of harsh reality checks reveals these promises to be hollow and insincere. In less than a week, we’ve seen two energy companies announce layoffs and closures that are going to hit hundreds of families. These blows, plus more that have been hinted at, pose a serious challenge to individuals and the community.
It’s one thing to scale back on employees or delay expansion; it’s another to announce that the show is canceled. These moves are not being described as short-term or temporary. Plans are based on this being the new norm, and the way companies redeploy billions of dollars in assets has the power to make this a self-fulfilling prophecy.
PacifiCorp plans to retire two-thirds of its coal fleet by 2030, including Units 1 and 2 at the Jim Bridger Power Plant by no later than the end of 2023. Units 3 and 4 are projected to operate through 2037, though we know many cases where closures were completed sooner than the original estimates.
Instead of relying on coal, PacifiCorp is ramping up green production, investing in the infrastructure to draw more electricity from the sunshine and winds that grace Wyoming. Some critics have asked, “Where will the power come from when the sun goes down and the wind has stopped?” The power company says the answer is better batteries. It believes technology will advance so extra power can be efficiently stored even when production lulls, which further diminishes the need for coal.
Earlier this week, Halliburton announced it will lay off about 650 employees in Wyoming, Colorado, North Dakota and New Mexico. The company said it offered most employees a chance to transfer to other operating areas “where more activity is anticipated.” That means the workforce loss will be even greater just than the eliminated positions, as other workers and their families will transfer elsewhere.
This isn’t the first Halliburton reduction, as in February 2016, it laid off an unspecified amount of workers in Casper and Rock Springs as part of a larger, 5,000-worker job cut, the Casper Star-Tribune reported. If other companies follow the lead of PacifiCorp and Halliburton, local hardships will be magnified.
Wyoming has survived massive seismic shakeups in the past. When railroads stopped relying on steam engines, businesses pivoted to using coal to generate electricity, which opened up new jobs and opportunities. We need to do something similar, such as offering more wind or solar power, or adding more tourism and manufacturing.
If we want to reach the benefits of the booms we’ve enjoyed in the past, we’ve got to build a new set of tracks, because the old structure is flattening out and seeing less differences between the highs and lows. Energy executives changed their focus based on the writing on the wall, and workers should do the same. That means they should identify strengths and weaknesses, and take advantages of opportunities to retrain. They shouldn’t wait for a boom, because you can’t live off promises.
The community must step up as well. Business and political leaders need to pursue the long-lauded diversification. They need real economic development — the kind that attracts and keeps quality jobs that provide enough benefits to support a family. The revitalization campaign can be aided by school districts and Western Wyoming Community College providing the instruction needed for newly created or identified in-demand positions. Neighbors should also be willing to share more resources with those experiencing difficulties during the transition.
Coal will always be around, but we need to stop expecting it to provide the same paychecks and positions. Our communities owe their existence to coal, but that doesn’t mean we have to put it first. In the past, Wyoming found new ways to thrive when it threw out the old playbook when the rules were revised. Today we need a similar, game-changing vision.
It will take creativity and bravery to leave the old boom-and-bust pattern behind, but this will allow us to escape a doomed cycle that only offers diminishing returns. In its place we can build something that’s more stable and doesn’t rely on drastic changes. You don’t need a boom if your model is sustainable, and perhaps we’ll look back and remember that this bust was unique in that it was our last.