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Monday, October 06, 2014

'War on coal' line obscures other reasons industry suffers; expert estimates half regulation, half gas

Coal industry advocates have pointed the finger at the Obama administration rules and environmentalists for the troubles, "but the truth lies somewhere in between, relying on a complex set of factors that are largely absent from the current debate over whether there is a 'war on coal'," Manuel Quiñones reports for Environment & Energy News.

While coal advocates call the rules an attack on the industry, that doesn't tell the whole story "because of American's newfound natural gas wealth," Quiñones writes. "Hydraulic fracturing technology has made it easier for energy companies to reach tough deposits in Pennsylvania, West Virginia and elsewhere."

James Stevenson, director of North American coal for the research organization IHS Energy, told Quiñones, "It is, I would say, probably a 50-50 split. The tipping point has really been caused by cheap gas." Quiñones writes, "In other words, Stevenson said in an interview, new regulations and market forces would probably not be having such an impact on coal if it weren't for the natural gas alternative."

"Coal used to account for more than half of U.S. power production," Quiñones writes. "But in 2012, low natural gas prices pulled that number down to roughly 32 percent. For the first time in recorded history, natural gas and coal were tied in fueling the country's power plants. Higher natural gas prices recently have driven a partial recovery in coal generation. The fuel accounted for roughly 40 percent of power production for 2013, according to the U.S. Energy Information Administration." (Read more)

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