The Wall Street Journal explains why the the U.S. coal industry is too dirty for America, and thus is being forced to send its product overseas.
Even as it faces increased regulatory scrutiny at home, America's dirty and unwanted coal is being embraced in one of the world's cleanest energy markets: the European Union.
Much of it is high-sulfur coal from under the plains of Illinois and Indiana—exactly the kind of high-emission, power-plant fuel receiving closer scrutiny from U.S. regulators and courts. Last week, the Supreme Court ruled in favor of enforcing regulations that require power plants in 28 states to cut coal emissions that blow across state lines.
Many U.S. power plants were already reducing emissions in anticipation of tougher Environmental Protection Agency rules that take effect in 2015. Now, the Supreme Court ruling could affect 1,000 power plants in the eastern U.S. that might need to install additional pollution controls or cut back on coal consumption.
Mr. Docker says the Illinois and Indiana coal, shunned in some places in the U.S. because of its high sulfur content, offers a less-expensive alternative than coal from nearby European mines—even including transportation costs.
Unfortunately for the U.S. coal industry, there are several major flaws with this strategy: 1) the U.S. is almost certainly not the "Saudi Arabia of Coal", as "current production levels may be unsustainable and, if anything, create a false sense of security;" 2) the increase in European coal demand is likely to be short lived, "as EU regulations will make it unattractive in Europe in the long run"; and 3) the urgent problem of climate change, which dirty coal only exacerbates. Other than that, U.S. dirty coal exports to Europe sounds like a brilliant plan...