ENERGY: US Coal Exports on the rise, but what of Global Emissions Control?

The worldwide demand for coal coupled with the recent cancellation (see Jan 20, 2008 post) of many coal-fired power plants in the US has begun to drive US coal prices higher. The price for Appalachian and Wyoming coal rose 93% and 67%, respectively in the last year.

Most US utilities have long-term contracts with fixed pricing for coal. But the need for coal for utilities and steel manufacturing in developing countries (e.g., China and India) is rising. US exports rose from 5% of production in 2005 to 8% in 2006, and the trend is expected to continue. This means that sooner or later the US utilities will have to negotiate expiring contracts, the price will go up, and our utility bills will rise. Coal makes up 50% of US energy usage!

Like the discussion about global reduction of greenhouse gases, coal presents another situation where the developed world can try to preach to the developing world about becoming green (e.g., less coal-fired plants, etc.). But, the developing countries counter that we've contributed most to the current climate situation and we've had our industrial boom - why shouldn't they have theirs?

We have 27% of the world's coal reserves and we continue to sell it overseas. It makes 'green' a tough sell around the world.