The U.S. is burning coal at a slower rate, due to cheap natural gas and environmental restrictions on air pollution. With utilities unable to justify weighty investments in pollution control technology, they have opted to shift their generation towards natural gas and renewable energy.
Not only has this nearly zeroed out U.S. coal imports, the decline of coal-fired power plants is forcing coal producers to look abroad to push their product. For several years, the U.S. has found willing buyers overseas. The total volume of coal exported from American shores jumped almost 45% between 2008 and 2013, a remarkable increase.
But it may come as a surpise that out of the top 10 destinations for U.S. coal exports, all but three of them are in the western hemisphere. In fact, Europe has snapped up the most U.S. coal, with the United Kingdom being the largest purchaser, importing more than 12.3 million tons in 2013.
Why is that? Energy demand in Europe is flat and strict environmental controls have the European continent rapidly turning to renewable energy, of which it has become a global leader. Meanwhile China is burning as much coal as nearly every other country combined. Why then, is China not buying up American coal?
The main reason is that the U.S. only exports coal through only a handful of ports and nearly all are located on the east coast or on the Gulf of Mexico. As such, they are far from the truly massive Asian markets. Transporting coal by rail…