Coal Craziness

One of President Trump’s promises was to bring back coal mining jobs.   The total mine workers in the coal industry is around 65,000 employees.down from peak of around 80,000 employees in 2011.

EIA website statistics

The production and  consumption over the last 15 years look pretty similar- a rising trend then a declining trend beginning in 2008.

The Energy Information Agency of the US Department of Energy, provides a comprehensive report each year.  A link to the 2016 report is provided below:

EIA Report on coal

There are really no encouraging statistics within this report.  Coal prices are down significantly.  Virginia’s coal prices were down 20%.   Productive capacity, or how much the US could produce, is definitely in decline.  There is a 5% increase in productivity,  or the tons of coal produced per employee- which might help the bottom line of mining companies, but further reduces employment.

US coal is used to produce electricity.  The reason for the decline in coal prices, production, consumption and employment is cheaper natural gas.

EIA Update on Natural Gas Prices

The trend to more power plants using natural gas is likely to continue.  The warm winter likely means less energy use.  Both natural gas and coal consumption are likely to decline in the next few months.

Deregulation is likely not to change much of the basic economics. See link:

Deregulation won’t work

Note that in the above article, they cite 200,000 jobs lost in 2 years and I state it is closer to 15,000 jobs since 2011.  My figures are strictly workers in mines, while some of the larger coal mining companies have gone out of business causing much larger job loss.

Hopefully, the employees with jobs less connected to the coal industry, can find other opportunities. Maybe in the booming solar industry- who knows

Stay tuned,

Dave

 

 

 

 

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