Pressure on CO2 and falling gas prices make Natural Gas an obvious choice. With the advent of hydraulic fracturing and the development of US natural gas resources, coal’s position is being challenged. This is not a partisan argument, it is a practical one.ģ.) Natural gas is cheap, clean(er) and is rapidly replacing coal for baseload generationĬoal has long been the dominant source of electricity on the US grid, it is cheap and plentiful, so its position as 50-60% of generation, has been safe for 60 yrs. The pressure on CO2 is mounting and coal, the highest emitting energy source, is the low hanging fruit. In April 2016 representatives from 200 countries met in Paris and reached agreement to reduce GHGs (4), Obama endorsed the EPA clean power plan, and to date 29 states have signed renewable portfolio standards which require a reduction in GHG intensity on their grids. Broad acceptance of these reports is signaled in several recent agreements and legislative actions. The intergovernmental panel on climate change has published six assessment reports since 1990 which conclude that human caused carbon emissions contribute to global warming. This bet went badly for many industry players, but they may have survived the shock if not for two other headwinds.Ģ.) Coal is the heaviest CO2 emitter per unit of energy and the consensus around climate change is strong The demand never materialized and metallurgical coal prices have fallen precipitously leaving many of these companies unable to service their debt (1). In 2010-2011, many coal companies took on debt burdens to scale up operations for a bet that Chinese demand for steel would continue to drive coal prices higher. There are three major factors that have contributed to this decline climate change regulation may have been the final stroke.ġ.) Lack of demand for Metallurgical coal exports to developing economies
Pathways to Just Digital Future Watch this tech inequality series featuring scholars, practitioners, & activists In a recent interview with Fox Business, Robert Murray, blamed “crony capitalism” and politics for the “virtual destruction” of his beloved industry (3). During this time more than three dozen coal companies have filed for bankruptcy protection (2). Since 2011, the market cap of publicly traded coal companies has dropped 94% (1). Can CEO Robert Murray shift his mindset to capture new opportunities in the energy industry? Or will Murray go down with its peers, too blinded by partisan anger to accept the facts of climate change and invest for a sustainable future? Murray Energy has managed to hang on by establishing a dominant cost position and becoming one of the few surviving American coal miners. Refusing to accept the facts of climate change, they have stuck to their core business, blamed partisan politics and fallen into bankruptcy one by one. The coal industry has been devastated over the last 6 years while coal executives have clung to the past.