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How Joe Manchin Aided Coal, and Earned Millions

At every step of his political career, Joe Manchin helped a West Virginia power plant that is the sole customer of his private coal business. Along the way, he blocked ambitious climate action.

This Grant Town power plant is the link between the coal industry and the personal finances of Joe Manchin, Photographs by Erin Schaff

GRANT TOWN, W.Va. — On a hilltop overlooking Paw Paw Creek, 15 miles south of the Pennsylvania border, looms a fortresslike structure with a single smokestack, the only viable business in a dying Appalachian town.

The Grant Town power plant is also the link between the coal industry and the personal finances of Joe Manchin III, the Democrat who rose through state politics to reach the United States Senate, where, through the vagaries of electoral politics, he is now the single most important figure shaping the nation’s energy and climate policy.

Mr. Manchin’s ties to the Grant Town plant date to 1987, when he had just been elected to the West Virginia Senate, a part-time job with base pay of $6,500. His family’s carpet business was struggling.

Opportunity arrived in the form of two developers who wanted to build a power plant in Grant Town, just outside Mr. Manchin’s district. Mr. Manchin, whose grandfather went to work in the mines at age 9 and whose uncle died in a mining accident, helped the developers clear bureaucratic hurdles.

Then he did something beyond routine constituent services. He went into business with the Grant Town power plant.

Mr. Manchin supplied a type of low-grade coal mixed with rock and clay known as “gob” that is typically cast aside as junk by mining companies but can be burned to produce electricity. In addition, he arranged to receive a slice of the revenue from electricity generated by the plant — electric bills paid by his constituents.

The deal inked decades ago has made Mr. Manchin, now 74, a rich man.

While the fact that Mr. Manchin owns a coal business is well-known, an examination by The New York Times offers a more detailed portrait of the degree to which Mr. Manchin’s business has been interwoven with his official actions. He created his business while a state lawmaker in anticipation of the Grant Town plant, which has been the sole customer for his gob for the past 20 years, according to federal data. At key moments over the years, Mr. Manchin used his political influence to benefit the plant. He urged a state official to approve its air pollution permit, pushed fellow lawmakers to support a tax credit that helped the plant, and worked behind the scenes to facilitate a rate increase that drove up revenue for the plant — and electricity costs for West Virginians.

Records show that several energy companies have held ownership stakes in the power plant, major corporations with interests far beyond West Virginia. At various points, those corporations have sought to influence the Senate, including legislation before committees on which Mr. Manchin sat, creating what ethics experts describe as a conflict of interest.

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As the pivotal vote in an evenly split Senate, Mr. Manchin has blocked legislation that would speed the country’s transition to wind, solar and other clean energy and away from coal, oil and gas, the burning of which is dangerously heating the planet. With the war in Ukraine and resulting calls to boycott Russian gas, Mr. Manchin has joined Republicans to press for more American gas and oil production to fill the gap on the world market.

But as the Grant Town plant continues to burn coal and pay dividends to Mr. Manchin, it has harmed West Virginians economically, costing them hundreds of millions of dollars in excess electricity fees. That’s because gob is a less efficient power source than regular coal.

Mr. Manchin declined an interview request. His spokeswoman, Sam Runyon, did not respond to detailed questions about his business interests, and whether those interests affected his actions as a public official. Senate ethics rules forbid members from acting on legislation to further their financial interests or those of immediate family members. There is no indication that Mr. Manchin broke any laws.

In the past, Mr. Manchin has repeatedly said that he has acted to protect valued industries in West Virginia, which ranked second in coal production and fifth in natural gas in 2020, according to federal data. He has defended his personal business ties to the Grant Town plant, telling the Charleston Gazette in 1996, “I did it to keep West Virginia people working.”

This account is based on thousands of pages of documents from lawsuits, land records, state regulatory hearings, lobbying and financial disclosures, federal energy data and other records spanning more than three decades. The Times also spoke with three dozen former business associates, current and former government officials, and industry experts.

The documents and interviews show that at every level of Mr. Manchin’s political career, from state lawmaker to U.S. senator, his official actions have benefited his financial interest in the Grant Town plant, blurring the line between public business and private gain.

Tom Brenner for The New York Times

Mr. Manchin and his wife owned assets worth between $4.5 million to $12.8 million in 2020, according to Senate financial disclosure forms, which provide only a range with few specifics. Mr. Manchin, who drives a silver Maserati Levante, reported dozens of assets, including bank accounts, mutual funds, real estate and ownership stakes in more than a dozen companies.

But the bulk of Mr. Manchin’s reported income since entering the Senate has come from one company: Enersystems, Inc., which he founded with his brother Roch Manchin in 1988, the year before the Grant Town plant got a permit from the state of West Virginia.

Enersystems Inc. is now run by Mr. Manchin’s son, Joseph Manchin IV. In 2020, it paid Mr. Manchin $491,949, according to his filings, almost three times his salary as a United States senator. From 2010 through 2020, Mr. Manchin reported a total of $5.6 million from the company.

Mr. Manchin describes Enersystems in disclosure forms as a “contract services and material provider for utility plants.”

The privately held company has no website. Its headquarters consist of a cluster of small rooms on the ground floor of a brick office complex in Fairmont, W.Va., that bears Mr. Manchin’s name. It has just two employees, according to filings with the West Virginia secretary of state.

When a reporter recently visited, Mr. Manchin’s son was the only person there. “We’re not doing interviews,” he said. “No comment.”

Data from the U.S. Energy Information Administration shows that Enersystems supplies a specific type of coal burned to generate electricity. And since 2002 — as far back as that data goes — Mr. Manchin’s company has had just one customer: the Grant Town power plant.

The community of Grant Town was built around one of the largest underground coal mines in the world. But since the mine closed in 1985, every other business has shuttered, along with the school. Many of the buildings have been condemned.

Despite its struggles, the community had something valuable to outsiders: mountains and mountains of gob.

Gob, an acronym for “garbage of bituminous,” is waste coal — low-quality material dug from a mine that is mixed with rock and clay, making it harder and less efficient to burn. For decades, dark gray gob piled up on the ground outside coal mines in West Virginia, barren heaps often reaching several stories high.

But in 1978, worried about the country’s dependence on foreign oil, Congress passed a law to encourage alternative energy sources. That led to the opening of several gob-burning plants, including Grant Town.

The developers who planned the Grant Town plant created American Bituminous Power Partners, or AmBit, to build the plant. AmBit signed a long-term contract with the local utility, Monongahela Power, to buy the electricity it produced from gob.

But before AmBit could start construction, federal agencies raised environmental concerns. The company got help from Joe Manchin.

Mr. Manchin grew up in politics. His father and grandfather both served as mayor of his hometown. His uncle, A. James Manchin, was West Virginia’s treasurer. Mr. Manchin’s father was close friends with Arch A. Moore Jr., a three-term West Virginia governor whose daughter, Shelly Moore Capito, is currently the state’s Republican U.S. senator.

Those ties helped Mr. Manchin get things done, said Jack Spadaro, then a supervisor for West Virginia and neighboring states with the U.S. Office of Surface Mining Reclamation and Enforcement, which regulates coal mines.

“He could control a bloc of votes in northern West Virginia,” Mr. Spadaro said. “If you got the Manchins behind you, you could really do something.”

Mr. Manchin used that influence on behalf of AmBit.

Trucks being loaded at the Humphrey No. 7 Mine in Maidsville, W. Va. 

Trucks being loaded at the Humphrey No. 7 Mine in Maidsville, W. Va. 

The Environmental Protection Agency was concerned the Grant Town plant would be too close to an existing coal-burning plant, resulting in excessive levels of sulfur dioxide, a threat to human health and plant life, according to documents obtained through a public records request.

Dale Farley, the West Virginia state official in charge of issuing air pollution permits at the time, recalled in an interview that Mr. Manchin approached him about approving the Grant Town plant. “He was pretty smooth about it,” said Mr. Farley, now 72 and retired. “But he let it be known that he was definitely interested in the project going forward.”

Mr. Farley struck an agreement with Monongahela Power, also called Mon Power, to limit emissions from the nearby plant, allowing the Grant Town plant to proceed. He informed the E.P.A., copying Mr. Manchin on the letter, and issued the permit for Grant Town. (Mr. Manchin’s intervention was reported by the Charleston Gazette in 1996.)

Had he known at the time that Mr. Manchin planned to have a financial relationship with the plant, “it would have bothered me,” Mr. Farley said.

After helping to win the permit for the plant, Mr. Manchin began to profit from it.

On Oct. 5, 1989, one of Mr. Manchin’s companies, Transcon Inc., bought an old coal mine in Barrackville, five miles south of Grant Town, for $380,000, according to records in the Marion County Courthouse. That same day, he sold the property and its gob piles to AmBit for $500,000 — a profit of $120,000.

But Mr. Manchin was not only a supplier of fuel to the Grant Town plant. He also got a share of its revenue.

Shortly before the plant opened, he signed another deal with AmBit, involving yet another old coal mine that Mr. Manchin owned, this one south of Farmington, Mr. Manchin’s hometown. He leased that mine, along with the gob on that property, to AmBit. In return, AmBit agreed to pay not just rent to Mr. Manchin, but also one percent of the gross revenue from electricity generated by burning gob from Mr. Manchin’s old coal mine, according to a copy of the lease at the courthouse.

Those terms, while not unheard-of, were generous to Mr. Manchin, said Stefanie Hines, a lawyer who teaches at West Virginia University and specializes in mineral rights. “These aren’t deals you give to everybody,” Ms. Hines said.

Once the Grant Town plant opened, Mr. Manchin urged his fellow state lawmakers to back a tax credit for power plants that burn gob, according to an account at the time in the Charleston Gazette. It passed the following year.

Just three plants in the entire state burned gob; Grant Town was one of them. At the time, Mr. Manchin dismissed suggestions of self-dealing, noting that he had broken no rules.

As the Grant Town plant continued to buy Mr. Manchin’s gob, his political ambitions grew. He was elected secretary of state, in 2000. Four years later Mr. Manchin rode a landslide into the governor’s mansion in Charleston. From that position, he helped the power plant win an even more coveted prize.

Shortly after the Grant Town plant began burning gob, AmBit said the operating costs were higher than expected, and the company was going to need more money for the electricity it was supplying to Mr. Manchin’s constituents.

Company executives sought approval from the West Virginia Public Service Commission, which balked, in part because the utility, Mon Power, opposed the request.

In 2006, with Mr. Manchin now occupying the governor’s office, AmBit again sought a rate increase. But this time, Mon Power supported its request.

The change in position followed Mr. Manchin’s involvement, according to people involved at the time.

AmBit enlisted help from Stanley Sears, whose company, Horizon Ventures, owns the land on which Grant Town sits. Mr. Sears knew Mr. Manchin and his family, and paid the governor a visit.

Speaking at the 35th Annual West Virginia Mining Symposium in 2008 while governor.Credit...Jeff Gentner/Associated Press

“Mr. Joe Manchin assigned his chief of staff, Mr. Larry Puccio to our — to help us,” Mr. Sears said, according to testimony that Mr. Sears gave in 2018 as part of a legal dispute between Horizon and AmBit. “Larry Puccio intervened with Monongahela Power Company and their lobbyists.”

After that meeting, Mr. Sears testified, Mon Power supported the rate increase. The Public Service Commission, led by a Manchin appointee, approved it.

The consequences of that rate increase turned out to be enormous. Since 2016, Grant Town has cost Mon Power $117 million more than it would have spent to buy that power from other sources, according to documents filed last year with the Public Service Commission. The utility had little choice but to buy the electricity; its contract with Grant Town doesn’t expire until 2036.

Mr. Puccio didn’t respond to requests for comment. Reached by phone, Mr. Sears declined to comment. A spokesman for Mon Power, Will Boye, said the utility “put the request in front of regulators and other stakeholders who could evaluate whether the rate increase and preservation of Grant Town were in the best interests of customers and the state.”

The extra costs were passed on to residents, burdening ratepayers in one of the poorest states in the nation.

Being sworn in to the U.S. Senate by Joe Biden in 2010.

Being sworn in to the U.S. Senate by Joe Biden in 2010.Credit...Drew Angerer/The New York Times

After Mr. Manchin ascended to a position where he could influence national policy, his family business began earning more revenue from AmBit.

In the middle of his second term as governor, Mr. Manchin handily won a special election in 2010 to fill the U.S. Senate seat vacated by the death of Robert Byrd. From a seat on the Senate Committee on Energy and Natural Resources, Mr. Manchin had an ability to shape federal policy governing oil, gas and coal.

He became one of the most vocal opponents to the E.P.A.’s proposed limits on emissions of mercury and other hazardous substances from power plants. The mercury regulations, which eventually took effect, were particularly threatening to plants like Grant Town, because gob generates more mercury per kilowatt of electricity when burned than traditional coal, according to Lisa Evans, senior counsel at the environmental advocacy group Earthjustice.

Mr. Manchin also sought to protect coal plants from more stringent regulation of coal ash, which gob-fired plants generate in higher volumes than conventional coal-burning facilities. He sponsored legislation in 2016 that gave regulatory authority over coal ash to states, rather than allowing federal regulators to dictate terms.

Mr. Manchin easily won a full Senate term in 2012 and re-election in 2018, and became a top recipient of campaign contributions from the mining, oil and gas industries.

Meanwhile, AmBit increasingly bought its fuel from Mr. Manchin’s company, to the point that it got 80 percent of its coal waste from the Manchin family business in 2020, compared to one-quarter when he first entered the Senate.

Reached by phone, AmBit’s executive director, Kenneth Niemann, agreed to answer written questions for this article but then did not respond to them.

On the surface, Mr. Manchin has a business relationship with a single power plant in West Virginia.

But determining the players behind AmBit, the owner of the Grant Town power plant, is a bit like handling a set of Russian nesting dolls.

At various points, three major companies — Edison International, NRG Energy and Tokyo-based Sumitomo — owned a significant share of AmBit, through a series of holding companies that had the effect of obscuring their involvement, records show.

And while all three companies partly owned the Grant Town plant, which was paying Mr. Manchin, their representatives lobbied the Senate on dozens of bills handled by the committees on which Mr. Manchin sat, according to Senate lobbying disclosure forms. Lobbyists are not required to identify specific pieces of legislation or name lawmakers with whom they meet.

Mr. Manchin’s AmBit ties put him in a position to help craft, support or block legislation that affected Edison, NRG or Sumitomo. And through their ownership of the Grant Town plant, those companies had influence over decisions that could affect Mr. Manchin’s income.

Mr. Manchin’s AmBit ties put him in a position to help craft, support or block legislation that affected Edison, NRG or Sumitomo. And through their ownership of the Grant Town plant, those companies had influence over decisions that could affect Mr. Manchin’s income.

When asked if Sumitomo or its subsidiaries had lobbied Mr. Manchin or his staff from 2010 through 2020, Sumitomo spokeswoman Amy Babcock said, “No, not to our knowledge.” A spokeswoman for NRG, Laura Avant, said the company’s lobbying “was not targeted” at Mr. Manchin during 2014 when NRG owned a stake in the Grant Town plant.

Edison would not say whether it had lobbied Mr. Manchin while the company owned part of the Grant Town plant. “Edison International has a responsibility to work with legislators on policies that best serve our customers,” said Jeffrey T. Monford, a spokesman for Edison. “We abide by all rules around those communications.”

Ms. Runyon, the spokeswoman for Mr. Manchin, would not say whether Mr. Manchin had ever been lobbied by Sumitomo, NRG or Edison while those companies owned a stake in Grant Town. “Throughout the entirety of Senator Manchin’s public service career, he has always been in full compliance with ethics and financial disclosure rules,” Ms. Runyon said in a statement.

Mr. Manchin’s ties to AmBit left him in a complicated position, according to Kathleen Clark, a law professor at Washington University in St. Louis who specializes in government ethics. He was in a position to help craft, support or block legislation that affected Edison, NRG or Sumitomo. At the same time, through their ownership of the Grant Town plant, those companies had influence over decisions that could affect Mr. Manchin’s income.

Mr. Manchin’s case demonstrates the need to tighten ethics rules, Ms. Clark said. “We care where the income stream comes from,” she said. “What you don’t want is essentially members of Congress to own companies that then become methods or mechanisms for the Sumitomos of the world to get in good with members of Congress.”

Demonstrators gathered near Senator Manchin’s yacht at the Wharf Marina in Washington in October.

Demonstrators gathered near Senator Manchin’s yacht at the Wharf Marina in Washington in October.Credit...Kenny Holston for The New York Times

In 2020, Mr. Manchin’s power reached new heights.

Mr. Biden was elected president in part on a promise to address climate change. Making good on that pledge hinges on moving legislation through a Senate that is split 50 Republicans to 48 Democrats and their two Independent allies. With Republicans unanimously opposed to most legislation introduced by Senate Democrats, any single Democrat can stop a bill by withholding support.

Last summer and fall, Mr. Manchin blocked the spending bill that contained Mr. Biden’s climate proposals, which had included penalties for power companies that did not reduce their coal use. But as those negotiations were underway in Washington, a different dispute was unfolding in West Virginia — one that may have affected Mr. Manchin’s incentives for ultimately opposing the federal climate bill.

For years, AmBit had warned that tighter greenhouse gas regulations could shutter the Grant Town plant. The company said it needed cash partly as a cushion against any new government limits on pollution. Last May, AmBit asked Mon Power to cancel the remainder of its contract, which expires in 2036, in exchange for a payment from Mon Power of as much as $200 million or more. That would allow Mon Power to find another source of electricity, maybe at a lower cost, and AmBit could try to find another customer for electricity from its Grant Town plant.

The stakes for Mr. Manchin were high. Grant Town was the only remaining power plant in his state that burned gob. If new federal climate rules put Grant Town out of business, his company would have no other potential customers for its waste coal.

Mon Power refused the request for a buyout. So AmBit turned to the Public Service Commission, asking it to force Mon Power to reconsider. In November, just as discussions between Mr. Manchin and the White House over the climate bill were reaching their peak, the commission held a hearing in Charleston to consider AmBit’s request.

In a filing to the commission, Richard J. Halloran, a founder and owner of AmBit, said that failing to get a buyout “will give us less protection against the anti fossil fuel (coal) sentiment and legislation and taxation.” (Mr. Halloran declined to comment.)

The commission’s chairwoman, Charlotte R. Lane, expressed skepticism, noting that just a few years had passed since the commission had granted the company its latest rate increase. “Now you’re back,” Ms. Lane said, according to the transcript. “I am somewhat perplexed at what you are doing.”

On Dec. 29, the commission rejected AmBit’s request, and with it the chances of a financial buffer against tighter climate rules for Mr. Manchin’s most important customer.

Ten days before the Public Service Commission announced its decision, Mr. Manchin said in a statement that he could not support the president’s bill, effectively dooming it.

Ms. Runyon, the spokeswoman for Mr. Manchin, did not directly respond to a question about whether Mr. Manchin’s ties to Grant Town influenced his decision to oppose the bill. “From the beginning, Senator Manchin has clearly articulated the reasons he could not support [the legislation] — rising inflation, the global pandemic and geopolitical unrest around the world,” Ms. Runyon said in a statement.

But among the reasons Mr. Manchin gave at the time was the bill’s effect on the power sector.

“We have invested billions of dollars into clean energy technologies so we can continue to lead the world in reducing emissions through innovation,” Mr. Manchin said in December. “But to do so at a rate that is faster than technology or the markets allow will have catastrophic consequences.”

The statement made no mention of Mr. Manchin’s ties to Grant Town.

-Kitty Bennett, Dionne Searcey and Steve Eder contributed reporting.