King Coal Leaves America for Europe

Thanks to the shale boom, US coal exports reached an all-time high last March. The Energy Information Administration (EIA) credits increased Asian demand—Chinese demand, in particular—with the uptick, but the broader explanation involves shale energy and Europe’s green policies.

The shale boom is displacing coal in America: coal is cheap, but the US glut of natural gas extracted from shale is often cheaper. Because of this, American coal producers are increasingly looking to market their product abroad. While China is the largest single destination for US coal exports (the country consumes nearly half of the world’s coal), the continent of Europe takes the lion share of the dirty energy source. Indeed, Europe imports more coal from the US than the rest of the world combined.

As you might expect, misguided green policies are largely to blame. Europe’s greens have been slow to embrace shale, but its solar and wind farms can’t power anything when the sun isn’t shining and the wind isn’t blowing. And with many nuclear plants shuttered in the wake of the Fukushima disaster, the continent has no option but to turn to fossil fuels. American coal is cheaper than Russian gas, so Europe imports coal, a fossil fuel that burns much dirtier.

America is decreasing its emissions by embracing shale, while it took an economic disaster for Europe to curb its own greenhouse gas contributions. Green energy policy has been a catastrophic failure in Europe, hampering the continent’s global competitiveness without making the continent any greener.

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  • Nick M.

    I don’t mind buying cheap trinkets from China. I also don’t mind them buying up our excess coal due to them needing it so badly for their energy requirements.

    Why? If a major crisis disrupts trade between us, the US may feel some discomfort as we get some poor 3rd world nation to make cheap trinkets for us. Lots of nations need our coal for energy/heat so finding a new place to export won’t be as difficult.

    And in turn, let China burn their trinkets for energy/heat. And let them starve trying to find cheap coal that the rest of the world is fighting over.

  • Atanu Maulik

    Americans have the GOP. That’s make all the difference.

  • S.C. Schwarz

    But the greens are already hard at work to block coal exports (see

    And the Obama administration is also hard at work to raise electricity prices (see

    Don’t laugh at Europe, we’ll catch up soon.

  • SLEcoman

    The data for this story is a bit dated. In April 2012 coal and natural gas each provided 32% of US power production, but by November coal’s market share had risen to 42% and natural gas’s market share had fallen to 26%. Coal regained market share as natural gas cost for power generation increased by 58% from $2.68/MMBtu in April to $4.23/MMBtu in November. During this same time period coal cost declined by 5% to $2.38/MMBtu. Since November 2012, natural gas cost has risen further while coal cost has remained essentially unchanged. (source EIA Electric Power Monthly)
    So let’s stop with this silly idea that the natural gas fracking boom in the US will allow the US to shift from coal to natural gas for power generation and reduce electricity rates.
    Comparatively low priced US natural gas (vs. international seaborne LNG prices) does provide some real economic opportunities, as evidenced by the resurgence of the US petrochemical industry.
    In the last several months, US coal export volumes have declined markedly as international steam and metallurgical coal prices have declined.
    Note: to convert $/MMBtu to an equivalent $/bbl price, multiply by 6 (i.e. $4.00/MMBtu = $24/bbl oil).

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