Demand for the fuel from the Illinois Basin in President Barack Obama’s home state climbed last year to the highest level since 1990 as sales of nearby Appalachian coal dipped and consumption of the product from Powder River Basin mines in Wyoming grew at a slower pace.
Illinois basin coal has greater sulfur content than the other coals, and either costs less or has a higher heat content, meaning it’s sought after by utilities forced to install scrubbers in their power plants by a succession of federal laws and Environmental Protection Agency rules. Its share of U.S. production will climb to 20 percent by 2040 from 13 percent currently, according to the Energy Information Administration.
“Here we are growing while the industry’s shrinking,” Mike Beyer, chief executive officer of Foresight Energy LP (FELP), said last week at the company’s Viking Mine in Macedonia, Illinois. “The market is not going away. It’s not going to zero.”
Illinois has the second-biggest reserves in the U.S., with 104 billion tons of coal, enough to power the country for 163 years at 2014 consumption levels, according to the EIA. It fell from favor after 1990 with expansion of the Clean Air Act and limits placed on sulfur dioxide emissions, which cause acid rain. In response, utilities began to install scrubbers to remove the contaminants or just shut down older, less efficient operations.
Dirtiest U.S. Coal Becoming Most Popular on EPA Rules
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