Thursday, October 11, 2012

GPT: EIS Scoping Comment No. 18

GPT: The Liability Labyrinth Linchpin

The GPT Application is notable for what it asserts regarding SSA-Marine's own liability, but that is nothing compared to what is NOT said.
For example, the statement that GPT will not OWN any of the coal it plans to handle is technically true, but that begs the question; 'WHO DOES OWN THE COAL?'
Certainly someone does, and at every step of the inextricably connected chain of events, beginning with leasing public land and mining the coal, right through to delivering the coal to a customer who will then burn it, releasing millions of tons of pollutants into the same atmosphere that everyone on earth shares.

It seems reasonable to expect that the principle of 'they who benefit, ought to pay' should apply to this entire scenario.
But, the only way that goal can possibly be achieved is to use full-cost accounting methods to account for both ownership and liability for the coal at every step of the leasing/mining to combustion chain of custody. 
Only a comprehensive treatment - necessarily including all the factors that GPT and its partners wish to externalize - of costs & benefits can begin to even approximate the actual ratio of costs versus benefits to the public, which is critical to justify approval of this Application in any variant form.

The dirty little secret, which GPT would rather the EIS ignore, is this; Peabody Coal will own the coal until it's customers actually take possession of it. 
Even then, the chain of impacts will not be broken because burning the coal will create pollution that the global public will have to accept, without any recourse to effective mitigation in any form. 
If one understands and  believes that global warming and climate change are rapidly happening, largely due to humans burning fossil fuels, then there is clearly additional cause for concern as a result of GPT's proposal.
But, if one chooses to disbelieve these scientific facts, they are ignorantly -even willingly- dooming the rest of us to the same fate that they, and their descendants, will have no choice but to experience; the very harmful effects that will very certainly occur in the future.

So, by GPT asserting that it's parent -PIT- and it's parent -SSA-Marine, and it's parent -Carrix- and it's 49% owner -Goldman Sachs- and the other private owners of the other 51%- will have no ownership in the coal they will handle is technically 'true', but only according to the strained logic and  legal loopholes being so cleverly employed. 
One has to do work on 'peeling this onion' to even begin to understand what each corporate entity is deliberately shielding.
But, do these legal gimmicks actually excuse each of the parties from actually having at least a degree of liability?
Surely, some portion of the 54 million metric tons of coal that GPT believes it will only 'handle' for a fee, will escape -on GPT premises- as dust, spillage or sediment from storm water collection. 
Who will own that? 
What will be the mandatory method of mitigation? 
Of disposal?
Who will pay what, to whom, and when?

The same questions apply to the owner/seller, Peabody Coal and each of its chosen transporters.
What responsibility will be assigned to BNSF for its dust, spillage and loss of coal due to derailments? 
Will BNSF own this dust, spillage and loss? 
If so, to what limits and conditions?
What about the ancillary pollution from burning diesel fuel, specifically to transport the Peabody coal? 
Would there be any reason to burn this fuel -and create other impacts- were it not for its voluntary contractual responsibilities to Peabody?

Likewise, should not these same questions need to be asked about the various and sundry owners and operators of the huge bulk carriers that will take delivery of coal from GPT and transport it to Peabody's customers
Depending on the form of purchase, either Peabody or its customer could own the coal during its long ocean voyage to its ultimate destination.
�� Cost, Insurance and Freight (CIF) – An international trade term of sale in which, for the quoted price, the seller/exporter/manufacturer clears the goods past the ship’s rail at the port of shipment (not destination). The seller is also responsible for paying for the costs associated with transport of the goods to the named port at destination. However, once the goods pass the ship’s rail at the port of shipment, the buyer assumes responsibility for risk of loss or damage as well as any additional transport costs. The seller is also responsible for procuring and paying for marine insurance in the buyer’s name for the shipment. The Cost and Freight term is used only for ocean or inland waterway transport. 
�� Free On Board (FOB) – An international trade term of sale in which, for the quoted price, the seller/exporter/manufacturer clears the goods for export and is responsible for the costs and risks of delivering the goods past the ship’s rail at the named port of shipment. The Free On Board term is used only for ocean or inland waterway transport.
All the hazards and pollution involved in such vessel transport also need to be fully accounted for, with liability assigned and public surety guaranteed to pay for any accidents or cleanup costs incurred. 
The very vessels involved burn heavy residual petroleum oil as fuel, which contains significant concentrations of known toxic substances in the form of sulfur, nitrogen, arsenic, mercury and other heavy metals which are released into the air at volumes that almost rival that of actually burning their coal cargoes. 
At least one recent, reliable report indicates that air pollutants emitted from the residual fuel oil powering these large vessels adds another 80% on top of the total air pollutants [per ton] released from actually burning the coal! 
That heavy residual fuel oil would not be burned at all unless the vessels are first contracted to carry this coal, meaning that NOT shipping coal would eliminate this additional large source of air pollution, likely representing the only mitigation possible.

The whole point of this concern is that someone always owns the coal being shipped, and those parties need to bear full responsibility for any liabilities incurred throughout the entire continuum of the cradle-to-grave logistics train involved, of which GPT is the critically important link that actually enables it. 
Because GPT is the linchpin upon which this entire process depends, then surely any truly comprehensive EIS scope could not reasonably ignore the much wider, connected impacts as described above. 

If the MAP Team concludes a much wider scope than that desired by the Applicant [e.g. only the 350 acres at the GPT site] is more appropriate, the essential full-cost accounting approach will be much more sufficiently fulfilled. 
Should that result in an analysis and evaluation that recommends the GPT project should proceed, then so be it.
But, even in that case, each participating party needs to be apportioned it's fair share of responsibility and liability, and required to post adequate bonds or other appropriate insurance to cover its share of costs of mitigation for accidents, spills and impacts wherever they may occur. 

It would be unfair -to the point of being grossly irresponsible- if this essential financial determination and apportionment were not timely made, and in a form likely to be effective in both protecting the public and the ecological systems that humans rely upon for their sustained well being.

However, if the cost-benefit analysis shows public costs exceed the benefits, this Application should be summarily denied
In either case, it is requested that this assignment of responsibility during each step of the logistics train be undertaken simultaneously with the EIS evaluation, so that public interests are matched with both the evaluation process and its conclusion.
Finally, I believe that all federal agencies, including the U.S. Army Corps of Engineers (USACE), have an obligation to demonstrate that projects authorized or facilitated by that agency are justified on the basis of net public benefits. This net public benefits accounting framework is essential to sound decision making. As part of this, tracking externalized costs is a standard requirement for evaluating all public expenditures. Additionally, natural resource damage assessment (NRDA) procedures probably need to be applied.
For comparison purposes, the 54 million metric tons of coal the GPT proposal wishes to handle would fuel eight [8] 1000 megawatt coal-fired power plants, or sixteen [16] times the case study shown below:

A Case Study: The Side Effects of a Coal Plant
A 500 megawatt coal plant produces 3.5 billion kilowatt-hours per year, enough to power a city of about 140,000 people. 
It burns 1,430,000 tons of coal, uses 2.2 billion gallons of water and 146,000 tons of limestone.
It also puts out, each year:
  • • 10,000 tons of sulfur dioxide. Sulfur dioxide (SOx) is the main cause of acid rain, which damages forests, lakes and buildings.
  • • 10,200 tons of nitrogen oxide. Nitrogen oxide (NOx) is a major cause of smog, and also a cause of acid rain.
  • • 3.7 million tons of carbon dioxide. Carbon dioxide (CO2) is the main greenhouse gas, and is the leading cause of global warming. There are no regulations limiting carbon dioxide emissions in the U.S.
  • • 500 tons of small particles. Small particulates are a health hazard, causing lung damage. Particulates smaller than 10 microns are not regulated, but may be soon.
  • • 220 tons of hydrocarbons. Fossil fuels are made of hydrocarbons; when they don't burn completely, they are released into the air. They are a cause of smog.
  • • 720 tons of carbon monoxide. Carbon monoxide (CO) is a poisonous gas and contributor to global warming.
  • • 125,000 tons of ash and 193,000 tons of sludge from the smokestack scrubber. A scrubber uses powdered limestone and water to remove pollution from the plant's exhaust. Instead of going into the air, the pollution goes into a landfill or into products like concrete and drywall. This ash and sludge consists of coal ash, limestone, and many pollutants, such as toxic metals like lead and mercury.
  • • 225 pounds of arsenic, 114 pounds of lead, 4 pounds of cadmium, and many other toxic heavy metals. Mercury emissions from coal plants are suspected of contaminating lakes and rivers in northern and northeast states and Canada. In Wisconsin alone, more than 200 lakes and rivers are contaminated with mercury. Health officials warn against eating fish caught in these waters, since mercury can cause birth defects, brain damage and other ailments. Acid rain also causes mercury poisoning by leaching mercury from rocks and making it available in a form that can be taken up by organisms.
  • • Trace elements of uranium. All but 16 of the 92 naturally occurring elements have been detected in coal, mostly as trace elements below 0.1 percent (1,000 parts per million, or ppm). A study by DOE's Oak Ridge National Lab found that radioactive emissions from coal combustion are greater than those from nuclear power production.
The 2.2 billion gallons of water it uses for cooling is raised 16 degrees F on average before being discharged into a lake or river. By warming the water year-round it changes the habitat of that body of water.----------------------------