As we all know, the coal industry sometimes gets hammered on the anvil of public opinion. When Shakespeare described “the slings and arrows of outrageous fortune,” he could have been talking about those of us who represent basic industries like mining. But no advanced society, competing in this take-no-prisoners global economy, can afford the loss of such valuable industries as ours.
·  Lately, I've thought about how far the industry has come in just a few years - and where we might be headed. All in all, it's been a fairly exciting ride for all of us.
·  Start with business conditions. It's difficult to contemplate the end of this boom because of all the headlines week after week that remind us of how big the boom is. Recently, The Washington Post business page touted what it called “the resurgent coal industry.” You know you're part of a truly resurgent industry when both The New York Times and Fortune carry glowing stories about coal.
·  Last year saw us break the U.S. record for coal demand, and this year the National Mining Association (NMA) is forecasting record-breaking production. NMA would love to take credit for this. But it isn't favorable government policy that's leading the U.S. coal parade - it's the marketplace. Everyday, it seems, a power company is unveiling plans to build coal fired capacity. There were 118 plans for new coal fired units announced in the United States this past year - that's more than were announced in the past decade.

As we know, this resurgence isn't just a U.S. phenomenon - it's a boom heard 'round the world. China is the global power plant using about a third of the world's total coal production. Its booming steel industry is already affecting world prices for metallurgical coal. And it relies on coal to fire 75 percent of its electricity.

To power an economy growing at 9.5 percent annually, the country has announced plans to build 562 coal-fired plants by 2012. That's more than half of the 850 new coal plants projected to be built worldwide; the others will be in India and the United States. While Europe and Japan dither over the Kyoto Treaty and how to implement it, the world's largest, fastest-growing economies may be making the treaty moot.

The King Gets His Due
These days, it seems everyone is echoing a recent headline in The New York Times proclaiming that “King Coal is back.” This may be news to the Times. But many of us would say that King Coal never left. The King was always here, as the nation's most abundant and reliable energy. Our reserves are the world's largest, giving us, conservatively, an estimated 250-year supply. On a BTU-equivalent basis, U.S. coal reserves are comparable to the world's oil reserves. We like to remind our friends on Capitol Hill of this enormous domestic supply - especially at a time of growing geopolitical uncertainty and growing U.S. dependence on foreign sources.

It is satisfying to see a measure of balance restored to our national energy discussion. After years of hearing only about the benefits of natural gas, now we hear only about the prices of natural gas. It isn't hard to see what's behind this new discussion. When gas consumption went up in the past decade, the growth in coal production went down - and U.S. factories went away. They were driven offshore by natural gas prices that today are 98 percent higher than they were in 1999. More than one million high-paying manufacturing jobs have been lost as a result.

The natural gas crisis is a cautionary tale for all of us in the energy business. It was prompted by government policies over the course of the prior decade - policies that favored natural gas over other fuels. It turned out the Clinton administration put not only its thumb on the scales, but its entire hand. Gas was the favorite. Once again, when government was trying to help, it was making things worse.

The experience reminds those of us in Washington of Oscar Wilde's famous remark: “Be careful what you wish for - you may get it.” For while natural gas demand was stimulated, the gas industry discovered that supply was not: Offshore exploration was ruled out, major pipelines were discouraged, Rocky Mountain development was off limits and Canada was not increasing exports - all at the same time U.S. gas fields were maxing out. By contrast, the current boom in coal is not a consequence of government policy, but of a free “election” by power companies and utility commissions voting for coal with their investment dollars.

Since 1980, electricity has tracked with U.S. economic growth more closely than any other energy use. Last year, coal fired almost 52 percent of electricity generation. The Energy Information Administration's (EIA) long-range forecast says that in the next 20 years, our economy will become even more dependent on electricity. Electricity consumption is projected to grow by 45 percent - 1.8 percent per year.

Coal is the only domestic energy source projected to increase production sufficiently to meet demand. In fact, it's the only energy source in the past 25 years that actually increased production. In April, EIA's short-term forecast projected coal production would jump 3.9 percent next year. When the EIA looks out to 2025, it forecasts coal production will reach 1.48 billion tons. Of this, electricity consumption will take 1.42 billion tons - about 42 percent more than is burned today.

One factor behind this rosy picture is our country's growing vulnerability to energy supply disruptions caused by our increasing dependence on imported natural gas. Before long, we will be importing a third of our natural gas consumption. It makes little sense to stimulate use of natural gas for electricity generation when clean coal is the more rational choice. And it makes less sense to stimulate use of any fuel that increases our dependency on offshore sources.

Then there is the local resistance to new LNG terminals built here in the United States. We've already seen this movie: Recall the promises that were made in the 1960s for nuclear power - and how that industry was brought to its knees when it couldn't build new capacity. No one expects a new nuclear power plant to be licensed anytime soon. Today the LNG industry is learning about the NIMBY factor just as the nuclear industry did years ago. Only today it's called the BANANA factor - build absolutely nothing anywhere near anything.

Every new coal project faces the same opposition, too, and even wind power advocates are finding that people like wind power only until the sight of wind turbines threatens their view. This all points up a striking paradox about American society: Our relentless consumer society has an unquenchable thirst for energy, but a cultural adversity to producing it. The analogy is a family that can't control its spending and finds itself constantly in debt to creditors. In our case, U.S. energy debt is represented by growing imports. This paradox - an extravagant taste for energy but a reluctance to produce it - has the potential to slow coal production.

Certainly it carries unsettling implications for energy policy. Congress is seeing this once again as it struggles - so far unsuccessfully - to pass a comprehensive energy bill. Earlier this year we saw this conflict play out over multi-emissions legislation, when the Senate failed to reconcile energy production and environmental protection in the Clear Skies bill.

But however the long-term forecast turns out, coal is still expected to generate at least half of the nation's electricity, and that's one half of a steadily growing component of the nation's energy picture. So, looking back over the last few years, we see the stage was being set for the return of exiled King Coal after the plot to depose him failed. From energy security and offshore demand to competing fuel prices, events were conspiring in his favor. Today, King Coal appears secure on his throne. His detractors are no longer intent on deposing him - they just want to reform his habits, making him into a cleaner-living monarch.

The Benefits of Clean Living
The good news is that King Coal is living cleaner. I know this contradicts conventional wisdom in the green community - the view that equates coal with bad air. But the facts paint a different picture. Since 1980, major emissions from U.S. power plants have fallen by about 40 percent - during a period in which economic growth grew by 93 percent, and coal used in electricity generation by 75 percent.

Plainly, the advent of clean coal technologies in the mid-'80s has made an impressive contribution to cleaning the air. With the Clean Air Interstate Rule and the Clean Air Mercury Rule released by EPA this year, we'll see further emissions reductions of almost 70 percent over the next 15 years - including, for the first time, reductions of mercury. We will reduce CO2 emissions, too. State-of-the-art pulverized coal and integrated gasification combined cycle technologies will accomplish impressive CO2 reductions by burning coal more efficiently, while at the same time allowing us to continue reducing PM, mercury, NOx and SO2. Important research is underway to show us how we can capture, sequester and dispose of CO2.

These achievements must now be reliably demonstrated on a long-term basis, in a range of actual conditions among varied types of power plants. Until they are, any attempt to impose arbitrary carbon caps on power plants will disrupt the energy market, and likely diminish the current investment boom in coal-powered generation. In that event, let's be clear about the consequences. Coal will not be the only loser. So will our manufacturing industries struggling with high natural gas prices; so will many tens of thousands of their workers who will lose their jobs; and so will a country that will become more dependent on energy sources it cannot control - as we export our manufacturing base to coal-burning nations like China.

Developing these technologies will obviously be a costly undertaking. But the payoff for coal utilization could be potentially enormous. That's why we view technological innovation as the key to our future. Earlier this year in Washington, we officially unveiled our Coal Vision report. It grew out of a thorough study undertaken by the Coal Based Generators Stakeholders group, a coalition that includes the coal-burning utilities, railroads and rural electric cooperatives, as well as the coal mining industry.

Our study aimed at how advanced coal technologies can achieve ultra-low emissions from coal-fired generation. Developing the proper suite of technologies will allow the United States to fully utilize its biggest domestic energy source and put the country on the path toward greater energy independence. The Coal Vision report represents a commitment from coal users to undertake steady and substantial investments in research and technological innovation to turn this vision of ultra-low emissions into reality.

Ten years ago, it may have seemed fanciful to envision this goal. Today, the plans for its realization are taking real form. Figures who are setting the nation's technology agenda certainly believe so. Dr. Jeffrey Sachs, director of Columbia University's Earth Institute, recently said, “With proper lead time and effort, clean coal with carbon capture and disposal is within economic and technological reach.”

‘Groundbreaking Development'
President Bush echoed this confidence in his energy speech in Ohio. After visiting with researchers at Battelle Labs, he called the FutureGen plant “a groundbreaking development.” That's a very apt description for a plant that will pioneer leading-edge technology designed to generate near-zero emission electricity via coal gasification. The sooner the United States gets started with FutureGen, the better our chances of shaping our energy future - rather than accepting a future on terms dictated to us by foreign energy suppliers.

It also means the environmental benefits will accrue sooner to countries that will soon become the biggest emitters of greenhouse gases. Think of the global consequences for CO2 emissions if the United States were to relinquish its leadership in developing clean-coal technology. Already, emissions from the most rapidly developing economies are projected to surpass our own in 20 years.

Let's be realistic. China and India will not forego the use of coal - and risk throttling the growth of their economies - simply to please Western consumers unable to control their own consumption. They're also unlikely to divert scarce investment dollars from their society's more pressing needs, simply to install and pay for control technologies with distant payoffs.

This is where U.S. technological leadership can help. With a strong commitment to develop clean coal technologies, the United States will be well positioned to export solutions to countries that need them most.  E+P

Jack Gerard is president and CEO of the National Mining Association. He will become president and CEO of the American Chemistry Council in July. These comments are from a speech he delivered on April 18. For more information, visit www.nma.org.