Coal / Mountaintop Removal

Coalface cracks under pressure from cheap gas

NEW YORK, NY — “This coal-to-gas switching is one of the few things supporting gas prices. Deutsche Bank estimates it is boosting U.S. gas demand by up to 5.6 billion cubic feet a day, equivalent to about 8% of demand. But that eats into coal demand. Friday, Alpha Natural Resources became the latest coal miner to announce cutbacks to cope.

Unfortunately for miners, there is ample scope for gas-fired plants to work harder. The legacy of the late 1990s’ ‘dash for gas’ remains. Nationwide, 39% of generating capacity is gas-fired, versus 31% for coal, says Morgan Stanley, yet gas-fired stations are used far less than ones burning coal.

…Coal miners have had a few breaks go their way. The delay to implementation of new pollution rules—which would force some coal-fired plants to shut altogether—provides some breathing room.

But just as gas inventories have ballooned, taking prices down, so coal stockpiles are starting to rise.”

— Liam Denning Wall Street Journal

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