Why Coal-Rich US Is Seeing Record Imports ; They've Jumped from 9 Million Tons to 30.5 Million Tons since 1999, as Demand Grows for Low-Sulfur Coal

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With nearly a quarter of the world's coal supply - enough to last centuries - the United States has been dubbed the "Saudi Arabia of Coal," by US officials and energy experts.

But thanks to growing global coal markets and clean air regulations, the US is witnessing a latter-day equivalent of "carrying coals to Newcastle" - a 230 percent leap in coal imports to the US since 1999.

Coal-fired power plants along the Gulf Coast and East Coast have long imported coal by ship in small amounts. But with transportation costs and the price of low-sulfur coal from central Appalachia and Wyoming rising, US demand is soaring for coal from South America and as far away as Indonesia.

Leaping from 9 million tons to 30.5 million tons in the past six years, US coal imports could jump to 40 million tons this year, government analysts say. And that trend is accelerating as demand for low-sulfur coal grows following last year's federal Clean Air Interstate Rule, a mandate for big cuts in sulfur dioxide emissions from power plants in the eastern US.

At the same time, US coal exports are declining sharply. If present trends continue, the US will be a net importer of coal by 2013, according to the Energy Information Administration of the US Department of Energy. Still, most analysts see little need to worry since vast US reserves mean the US is unlikely to become dependent on overseas coal.

"It's truly an ironic situation with the growth in imports, but in the bigger picture, there's no need to worry," says Richard Bonskowski, a coal analyst at the Energy Information Administration. The US produced more than 1.1 billion tons of coal last year, he says. So the US is importing only 4 percent of US consumption.

The electric power industry consumes more than 90 percent of all coal burned in the United States. …