Energy

This bill directs West Virginia's Office of Energy to develop a comprehensive energy policy and plan covering coal, natural gas, nuclear, renewable, hydrogen, and geothermal sources. It transfers the Office of Coalfield Community Development into the Office of Energy, eliminates outdated duties like the annual coalfield report, and grants the Office new authority to hold stakeholder meetings, set energy-ready community criteria, and designate project sites. The legislation also repeals the 2023 Coal Fired Grid Stabilization Act, merging its provisions into a new "Comprehensive Grid Stabilization and Energy Security Act." The Office must submit annual reports on its findings and develop strategies for multiple energy sectors, including state energy security planning. This restructures state energy policy to embrace diverse energy sources while focusing on stability, cost, and security.

SB 686 modifies West Virginia's coal law to allow mining operations when some co-owners of coal land consent, even if others do not. It states that operators mining with consent from at least one co-owner are not committing "waste" or "trespass," and nonconsenting co-owners (including unknown or unlocatable owners) must receive a royalty payment based on their ownership share. The bill creates a new "Unknown and Unlocatable Coal Interest Owners Fund" managed by the State Treasurer to hold royalties from unlocated owners, with funds later transferred to the Special Reclamation Fund. This directly affects coal operators, surface owners, and all co-owners of coal estates, streamlining mining operations while ensuring nonconsenting owners receive compensation.

This bill reduces the severance tax rate on metallurgical coal produced in West Virginia, affecting coal mining companies that extract this type of coal. The new rates will take effect in stages starting July 1, 2026, lowering the tax from 5% to 4.5% for the first year, then to 4% the following year, and finally to 3.5% beginning July 1, 2028. Metallurgical coal is defined as coal used for making steel and other metals, distinct from thermal coal used for electricity generation. The tax reduction applies to the gross value of coal produced and includes additional local taxes that are normally part of the total severance tax.