By MEG HANDLEY
China alone uses almost as much coal as the rest of the world combined, a report from the U.S. Energy Information Administration noted Tuesday, and will likely dominate the coal market in 2013 thanks to the nation's increasingly ravenous demand for energy.
That bodes well for America's coal industry, experts say, which has languished in recent years as environmental regulations have tightened and a newfound abundance of natural gas has re-framed the nation's energy equation, dampening domestic demand for coal.
"Coal use in America is being driven down in large part by EPA regulations, both those that have been announced and those that are forthcoming," says Heath Knakmuhs, senior director of policy at the U.S. Chamber's Energy Institute. "Of course we also have plentiful shale natural gas resources that have made natural gas a very attractive alternative from an economic sense [to be used to generate electricity]."
But those same regulatory and market forces aren't necessarily in play in China, Knakmuhs says. Historically, natural gas has been much more expensive in Asia and elsewhere and while the Chinese are exploring ways to exploit their own shale deposits for natural gas and oil, many infrastructure obstacles remain, he says, which makes cheaper coal one of the best energy sources for the power-hungry nation.
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"[There are] enhanced opportunities for exports of American coal to China to feed some of that demand," Knakmuhs says. "While China does have significant internal coal resources they're often far away from load centers. It does provide an opportunity for American coal suppliers—especially those located in the western U.S. to export enhanced amounts to China."
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