Miami Herald
Old-school coal is making a comeback

Friday, April 18, 2014

WASHINGTON -- Coal, the former king of American energy, is making a comeback after being left for dead in favor of cleaner-burning natural gas.

For years coal has been losing market share as the American fracking boom created a flood of cheap and abundant natural gas. But natural gas prices have edged upward, and the frigid winter created unprecedented energy demands. Power plants have increasingly been turning to coal as the solution.

There’s serious doubt whether the resurgence in coal can last in America with stricter environmental rules coming. But the global outlook for coal is bright, and U.S. coal producers hope to take advantage by increasing exports to other countries hungry for cheap energy. The International Energy Agency believes coal will be the No. 1 fuel for meeting the worldwide increase in energy demand.

Coal’s renewed popularity is a result of natural gas prices more than doubling over the past two years in response to a tighter market.

Those prices allow cheap coal to compete. The use of natural gas for power generation dropped in 2013 for the first time in five years as a result.

The Arctic blasts of this year’s winter also pushed power plants to turn to coal in order to meet the nation’s record-setting heating requirements.

“The main benefactor of this extreme cold and extreme low in natural gas inventory is coal,” said Bob Yu, an analyst for Bentek Energy.