Although the Senate majority leader, Mitch McConnell, may call the Obama administration’s climate change agenda a “war on coal”, King Coal is being overthrown by a fellow fossil fuel: natural gas. The two carbon-based energy sources often have similar supporters in Congress; however, like Brutus and Caesar, natural gas is driving an unexpected economic knife into coal’s back, cutting into its market share as utilities turn increasingly to cheaper and cleaner energy sources. The US EIA reports that natural gas surpassed coal in annual share of total US electricity generation for the first time in 2015.
Natural gas already the preferred investment of large financiers of new energy projects like JPMorgan Chase, Bank of America, Citigroup and Morgan Stanley. So even if clean power rule and other Obama administration policies could be blocked, the coal industry is bound to sustain further hardship and job losses as has been the case for years since new projects are almost exclusively cleaner alternatives like natural gas and wind.
Of course, political threats to the fuel are still significant. Just this month Democratic frontrunner Hillary Clinton told a CNN town hall that “we’re going to put a lot of coal miners and coal companies out of business,” while answering a question about a clean-power economy. Her comment makes for a tactless but illustrative example of her energy policy plans. Given the disarray of the Republican party and the likelihood of a Democrat winning against the divided party in November, Clinton’s commitment to continuing Obama administration policies on energy and environment will definitely be detrimental to the coal industry. Rules regarding mercury and other pollutants have already caused many coal-fired power plants to shut down and, with the Supreme Court on the brink of a liberal majority, other rules governing carbon dioxide emissions are likely to be upheld.
Adding to producers’ problems are is the lackluster performance of large-scale carbon capture and storage project, SaskPower’s Boundary Dam 3, which was to be the first case of a power plant using amine to remove CO2 directly from exhaust to be buried underground. Failure to meet emission cut targets and cost overruns are crushing the hopes of clean coal advocates.