Issue
Inafutureworldof8.5billionpeoplein2035,theEnergyInformationAdministrations(EIA)projected50%increasein
energyconsumptionwillrequiretruealloftheaboveenergyresourceusefromoil,gas,renewables,nuclear,andcoal.
Inparticular,coalwillcontinuetobetheworldsenergycornerstone,providingmoreincrementalenergyoverthatsame
timeperiodthananyothersinglefuel.
Coalhaslongbeenacenterpieceofalowcost,highreliabilityelectricitygrid.Todaythereare1.3billionpeopleacross
theglobewithoutaccesstoelectricityand2.7billionpeoplewhodonothavecleancookingfacilities.Theproblemis
spreadacrossthedevelopingworld,butitisparticularlysevereinsubSaharanAfricaanddevelopingAsia,which
togetheraccountfor95%ofpeopleinenergypoverty.Withoutacommitmenttoachieveuniversalenergyaccessithas
beenestimatedthatby2030,therewillbeanadditional1.5millionprematuredeathsperyearcausedbyhousehold
pollutionfromburningwoodanddungandthroughalackofaccesstocleanwater,basicsanitationandhealthcare.
Modernenergysourcesareessentialtomeetingthesechallenges.1
Figure1.GlobalEnergyPoverty
Coalcurrentlysuppliesaround30%ofprimaryenergyand41%ofglobalelectricitygeneration.From2001to2011,
globalconsumptionofcoalrose56%,asoilconsumptionslowed.Coaluseisforecasttocontinuetoriseover50%by
2030,withdevelopingcountriesresponsiblefor97%ofthisincrease,primarilytomeetimprovedelectrificationrates.2
Coalisthemostwidelyavailablefossilfuelenergyresource.Unlikegasandoil,itiswidelydistributed,both
geographicallyandintermsofresourceownership.Itsabundanceprovidesenergysecuritytomanycountriesbecause
itssupplywilllastsignificantlylongerthangasoroil.
1
2
Figure2.GlobalElectricalPowerGenerationbySource
Almosthalfoftheworldsenergydemandoverthepasttenyearswasprovidedbycoal(Figure3).Allotherfuels
combined,includingoil,naturalgas,renewablesandnuclearenergy,accountedfortheotherhalf.Infact,everyyear
overthelastdecadecoalhasbeentheworldsfastestgrowingenergysource,drivenbyAsiandemandandregional
abundanceofthefuel.
China'smarketforthecommodityisprojectedtodoubleinthenextfewyears.MorethanthreefourthsofChina's
energyproductioncomesfromcoal,makingittheworld'sNo.1coalconsumer.Chinaimportedonlyabout5.5million
tonsofcoalfromtheUnitedStatesin2011,whichaccountedfor3percentofits182milliontonsofimports,according
toareportbytheCarnegieEndowment.
Morethananyothernation,Americacancontrolitsownelectricalenergydestiny.Coalcanbethefoundationofthat
control.Almost30%oftheworldscoalreservesareintheUnitedStates.Theabilitytoutilizedomesticcoalreservesto
addressproblemsofenergyaccessreducesrelianceonimportedenergy,particularlyoilandgas,whichareoften
sourcedfromunreliableandunstablemarkets.Utilizationofcoaltocomplementrenewableenergysources,particularly
wind,reducestheriskofanintermittentsupply.
TheNationalCoalCouncil3hasidentifieditsvisionforU.S.coal.First,coalsabundanceandwidespreaddistribution
presentthemeanstoproduceelectricityreliablyandaffordably.Second,coalsversatilityallowsconversiontoliquid
transportationfuels,naturalgas,andchemicals.Third,improvingcoalsenvironmentalperformancethroughadvanced
coaltechnologiescoupledwithCO2captureandstorage,includingenhancedoilrecovery(EOR),willnotonlymakeit
possibletomeetclimatepolicygoals,butalsoopenmoredoorstothebeneficialuseofCO2.Finally,thedynamicactivity
associatedwithdeployingadvancedcoal,carboncaptureandEORtechnologieswillstimulatetheeconomy,provide
jobs,reviveestablishedindustries,andcreatenewones.
Harnessing Coals Carbon Content to Advance the Economy, Environment, and Energy Security, National Coal Council, June 2012.
Society for Mining, Metallurgy and Exploration, Inc. | 12999 East Adam Aircraft Circle, Denver, CO 80112 303 948 4250
Figure3.IncrementalWorldPrimaryEnergyDemandbyFuel,20002010(Mtoe)
Background
Coalisastrategicresourcethatiswidelyrecognizedasessentialforamodernqualityoflife,isakeycontributorto
sustainabledevelopment,andanessentialelementinenhancedenergysecurity.TheInternationalEnergyAgency(IEA)
estimatesthatglobalelectricitydemandcoulddoubleby2035,asmorepeoplegetbasicaccesstoelectricityaroundthe
worldandhouseholdenergyconsumptiongrowsinthedevelopingworld.Thepercentagesofnationalelectrical
productionfueledbycoalpresentedinFigure4supportthisestimate.Globalcoaldemandwillincreasesubstantially
overthecomingdecades.Globalcoalproductionincreasedforthe12thstraightyearin2011,bymorethan6percent,
accordingtoEIA.Morethan90gigawattsofnewcoalfueledpowercapacitywillcomeonlinein2012,largelyinthe
developingworld.
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Figure4.CoalinGlobalElectricityGenerationbyCountry
France
Canada
Russia
Vietnam
Netherlands
Japan
Turkey
United Kingdom
Germany
Korea
USA
Zimbabwe
Denmark
Morocco
Czech Republic
India
Kazakhstan
Australia
China
Poland
South Africa
Mongolia
Botswana
0%
20%
40%
60%
Provencoaldepositsexistoneverycontinent.TheUnitedStateshastheworldslargestsupplyofknownrecoverable
reserves,orabout24percent.Coalisfoundin38U.S.states,andnearlyoneeighthofthecountryliesovercoalbeds.
Topcoalminingstatesbytonnageinclude:Wyoming,WestVirginia,Kentucky,Pennsylvania,Montana,Texas,Indiana,
Illinois,NorthDakota,Ohio,andColorado.
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Figure5.CoalReservesintheU.S.(Source:USGS2012)
CoalsuppliesintheU.S.arefarmoreplentifulthandomesticoilornaturalgas;theyaccountfor95percentofthe
countrysfossilfuelreservesandmorethan60percentoftheworldsfuelreserves.TheU.S.hasabout240billiontons
ofrecoverablecoal,whichcouldlastabout235yearsifconsumedatthesamerateastoday.Tomeetenergyand
metallurgicalneeds,theU.S.minesaboutonebilliontonsofcoalperyear.In2011,worldproductionofcoalwas7.7
billionmetrictons.
Figure6.CoalReservebyCountry
Source: BP 2008
Ithasbeenestimatedthatthereareover860billion
tonsofprovencoalreservesworldwide(Fig6).Some
depositsareestimatedtohaveasmuchas400yearsof
productionremainingandnewtechnologiesforutilizing
coalresources,suchasundergroundcoalgasification,
arelikelytoboostcoalsfutureroleinenergysupply
evenfurther.Coalreservesareavailableinalmostevery
countryworldwide,withrecoverablereservesinaround
70countries.ThelargestreservesareintheU.S.,Russia,
China,AustraliaandIndia,respectively.Importantly,
manycountrieswithsignificantenergypoverty
challengesalsohavesignificantcoalreserves.
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EMPLOYMENT&PRODUCTION
NearlyhalfofU.S.electricityand40%ofglobalelectricityisgeneratedfromcoal.
9outofevery10tonsofcoalminedeachyearintheU.S.isusedfordomesticelectricitygeneration(steamcoal).
Thereisagrowingexportmarketforbothmetallurgicalcoal(formakingsteel)andsteamcoal.
EachpersonintheU.S.uses3.4tonsofcoalannually.Theglobalaverageislessthan1tonperyear.
CoalisoneofthemostaffordablesourcesofpowerfuelpermillionBtu,historicallyaveraginglessthanonequarter
thepriceofpetroleum.
TheU.S.producesabout1billiontonsofcoalannually,whereasglobalproductionofcoalisabout7.7billiontons
peryear.
Approximatelytwothirdsoftoday'sdomesticcoalproduction,bytonnage,resultsfromsurface,ratherthan
undergroundmining.MountaintopmininginAppalachiacontributesapproximately10percentofallcoalminedin
theU.S.andisroughly40percentofthecoalminedinWestVirginiaandKentucky.
Foreachcoalminingjob,anadditional3.5jobsarecreatedelsewhereintheU.S.economy.
U.S.coalminingdirectlyemploysabout142,000peoplewithanaveragewageof$73,000peryear.
Coaldirectlyprovidesmorethansevenmillionjobsworldwideandindirectlysupportsmanymoremillions.
In2010,thecoalindustryinvestedmorethanUS$7billionincapitalexpendituresindevelopingcountries.
ECONOMIC,ENVIRONMENTAL&SOCIALCHALLENGES
ChallengestotheU.S.coalindustryincludestrivingforzerominefatalities,maintainingcompliancewithstrictermine
safetyrules,reductionsinU.S.thermalcoaldemandduetocompetitionfromlowpricednaturalgas,stricter
environmentalregulationsaffectingthecostofproducingandusingcoal,andweakerinternationalanddomestic
economies.
Minesafetyandworkerprotectionmustremainatoppriority.
Thecoalindustrymustdevelopandimplementnewtechnologiestomitigateconcernsrelatedtosubsidence,
acidrockdrainage,properlyengineeredcoalashretentionstructures,andAppalachiancoalminingtechniques.
TheU.S.EPAhasissuedregulationsgreatlyreducingthenumberofnewcoalfiredpowerplantsthatwillbebuilt
inthecomingdecadeswithoutcarboncaptureandstorage.However,fullscale,commercialcarboncaptureand
storageisstillintheresearchanddevelopmentstage.
IntheU.S.,theshareofelectricpowergenerationfueledbynaturalgasisprojectedtoincreasefrom24%in
2010to27%by2035,whiletheshareofrenewableenergywillgrowfrom10%to16%overthatsameperiod.
Coalfiredpowergenerationwillfallto39%ofpowergeneration,butremaintheleader.
DuetotheescalatingcostofimportedliquefiednaturalgasinEuropeandotherregionscoupledwiththe
declineofdomesticcoalusageinbasepowergeneration,majorcoalandenergycompaniesintheU.S.are
investingintheexportsupplychain.TheNetherlands,UnitedKingdom,SouthKorea,Japan,China,India,Brazil,
Canada,MexicoandMoroccoaretopexportdestinationsforU.S.metallurgical(steelmaking)andsteamcoal
(electricalpowergeneration).
Currently,U.S.coalcompaniesareinvestingmorethan$500milliontoincreasethecoalexportsupplychain
capacitytomeetrisingoverseasdemand.
Westerncoal,includinglowsulfurcoalfromthePowderRiverBasinofWyomingandMontana,isexpectedto
becomeanincreasinglyimportantpartoftheU.S.exportmarketasportfacilitiesontheWestCoastare
permittedandbuilt.
Society for Mining, Metallurgy and Exploration, Inc. | 12999 East Adam Aircraft Circle, Denver, CO 80112 303 948 4250
SUMMARY
Allenergysources,includingnuclear,hydro,wind,solarandotherrenewables,havesomeroletoplayincontributingto
theelectricalpowergrid.However,fortheforeseeablefuture,baseloadpowergenerationthroughtheuseoffossil
fuels,andespeciallywithcoal,isthemostcosteffectivewaytoprovideaffordable,safeandreliableelectricityatthe
scalethatisneededtoachievegenuineaccesstomodernelectricityservicesworldwide.Coalis,andwillcontinuetobe,
thebackboneofglobalelectricitygeneration.ExportofU.S.coaltoenergyresourcepoorcountrieswillcontribute
significantlytoreducingglobalenergypoverty.Further,intheU.S.,distinctenvironmental,economicandsocial
challengestothecontinueduseofcoalmustbebalancedwithanacknowledgmentbypolicymakersthatcoalisstilla
viableenergysource,isessentialtonationalsecurity,andshouldbeincludedinanydiscussionofalongtermallofthe
aboveenergypolicy.
Society for Mining, Metallurgy and Exploration, Inc. | 12999 East Adam Aircraft Circle, Denver, CO 80112 303 948 4250