Coal is a fossil fuel that has been around for centuries. From Marco Polo to the middle ages, evidence of prominent and frequent coal consumption exists in various artifacts and texts around the world. It has been used to heat homes and power locomotives, as well as in various industries like steel and in other heating processes.

On a global scale, coal has maintained its status as the largest energy source for generating electricity. In the United States this statement held true throughout the 1990’s and early 2000’s. However, since about 2007, across America there has been little to no growth in the sale or production of coal for use in the energy industry. Instead, the economy has seen a steady increase in the supply of natural gas and a decline in the price of natural gas that has substantially stunted the development and mining of coal. In addition, during this time, wind and solar sourced electricity sales and production have also made a noticeable jump.

Coal’s Gradual Decline – By the Numbers

A recent report published by the U.S Energy Information Administration shows that between 2007 and 2015, the use of steam coal for electricity in the United States dropped 29% (from 1,045 million short tons to approximately 739). This decline can be seen in almost all states during that period of time, except for Nebraska and Alaska. The states that experienced the largest drop in coal consumption are found in areas of the Southeast and Midwest, while smaller dips in the market occurred in the Rocky Mountain region, Montana, Wyoming and North Dakota.

During this same period, the electric power sector also experienced a decrease in coal use. For example, Ohio dropped by 49%, Pennsylvania by 44% and Indiana by 37%. To provide some context, this means that these particular states experienced a drop in coal consumption from 176 million short tons to 100 million short tons.

In 2015, the coal consumption or use in states like Georgia, Alabama and North Carolina, reached half of what it was in 2007. Overall, their coal consumption reduced from 110 million short tons to 56 million short tons, whereas natural gas consumption increased from 338 billion cubic feet to 1,021 billion cubic feet.

The change in demand has also impacted the supply of coal. From 2007 to 2015, Indiana and Ohio did not receive as much coal from Wyoming and Montana’s Powder River Basin. The import of coal from Colombia to Alabama also dropped, while Central Appalachian coal in Georgia and North Carolina dropped because of the coal produced from the Illinois Basin.

What Happened?

There are several factors that have contributed to the gradual decline in coal consumption since 2007. One of the major factors is both the availability and price of other electricity generating fuels. These alternative fuels include, natural gas, and cleaner energy generation options like solar and wind. Another significant factor includes the environmental impacts mining and burning coal has had on the environment as well as the kinds of practices some companies follow during the coal mining process.

The Rise of Natural Gas

The United States energy information administration has estimated that in 2016, natural gas will switch places with coal to become the leading fuel for the generation of electricity. There are several reasons for this dramatic change in the market. The primary reason is related to supply and demand.

In 2015, the supply growth of natural gas exceeded the demand growth, which is a huge factor in helping to keep the rates or price of this fuel low. According to the Natural Gas Supply Association, only Exxon Mobil Corp., one of the top ten natural gas production companies in the United States, cut down on how many cubic feet per day of natural gas they produced. Companies like, Southwestern Energy Co., and Cabot Oil & Gas Corp., all raised production efforts by approximately 511 million cubic feet per day.

Increased production and lower rates actually help these major players to generate a profit, one that continues to help natural gas continue to succeed ahead of coal. These major natural gas production companies simply have to capitalize on new fracking and drilling technologies. These new technologies help them to better target areas or regions that will give them the highest volume of product per day. Currently, these areas include the Utica and Marcellus shales, which are located beneath New York, Pennsylvania, Ohio, and West Virginia.

Since 2012, approximately 85% of the United States growth in natural gas production is due to the discovery of these shales. For example, productive wells can produce up to 72.9 million cubic feet of natural gas per day. The result could generate or create a break-even result of $2 per 1,000 cubic feet of natural gas. These numbers encourage natural gas companies to continue meeting the current level of supply and demand.

Cleaner Energy Incentives

For the past few years, the United States government has really pushed utilities and other companies to turn to fuels that burn cleaner and have less of an impact on the environment. For example, in 2012, the state of Indiana came up with a voluntary energy portfolio standard. This piece of legislature motivates retail power generators and energy utilities to find ways to generate electricity from wind or solar technologies. It also encourages these kinds of companies to turn towards natural gas generators instead of coal.

The result of this incentive caused electric power plants in Indiana, as well as Pennsylvania and Ohio to increase natural gas use to 777 billion cubic feet by 2015.

Nearly every state offers many different initiatives for switching over to or consuming electricity generated from cleaner fuels. From tax rebates to discounts, there is a big push to comply with new legislature and change the way cities and citizens look at energy consumption practices. As a result, people have gradually started to move away from coal towards primarily using natural gas.

Environmental Coal Concerns

Another major example of why coal consumption is on the decline is because of America’s dedication and focus on addressing environmental issues like, climate change.

The affects or impacts of coal on the environment have become more and more apparent every year. While in the past it has been one of the largest sources of electric energy generation, burning coal also releases a massive amount of carbon dioxide. For example, in 2011, 14,416 million tons of coal emissions were released worldwide. While natural gas releases around 1,100 pounds of carbon dioxide coal releases nearly twice as much at 2,000 pounds.

To prevent or decrease further damage to the environment, the United States has put several policies into play to shift the focus away from coal in order to reduce its harmful impact. This shift has helped America to move towards cleaner sources of energy such as wind, solar and natural gas. While many experts believe that natural gas will continue to rise as the new dominant fuel source, alternative natural resource generated energy is expected to gain in popularity over the next few years.

Coal Mining Practices

In addition to the rise of natural gas and environmental factors, many coal companies have been brought into question regarding their past and current mining practices.

In 2010, 25 men were killed in an explosion at the Upper Big Branch mine. The plant had a history of unsafe mining practices caused by improper ventilation of methane gas. Little changed after that event, until recently, as the former chief executive was deemed accountable for the explosion and will spend 1 year in prison.

Other major mining concerns include the way in which companies treat the environment during the excavation process. Mountaintop removal mining is a practice that was endorsed by many companies. It is the process of blowing up the tops of mountains to gain access to coal that is harder to reach. This practice is devastating to forested areas, and allows toxic debris to poison water sources seep into the earth. However, coal mining companies defended this practice for years as the cheaper option as it lowered the cost of labor.

Due to the level of attention that the American government has put on coal these practices and companies have come under great scrutiny by various parties. These issues were one of the driving forces behind government changes in legislature, in making natural gas and other renewable resources the better option. As a result, three well known coal companies including, Peabody Energy, Arch Coal and Alpha Natural Resources have faced bankruptcy, one of the heavier economic impacts of this shift in fuel consumption.