When Donald Trump promised during his 2016 campaign to ‘make coal mining great again,’ little did he know that the industry would rebound the way it will in 2022.
But that’s not going to be a good thing, either.
Trump as the president worked to revive the coal mining industry because even though fewer and fewer power plants utilize the fossil fuel domestically, there is a massive global market for coal in the developing world. China and India, for instance, have voracious appetites for coal as most of their power plants coming online burn coal to generate power (and they do that because coal is far cheaper than natural gas and nuclear power).
But because the Biden regime is being run by insane leftists whose agenda includes crashing the country so they can rebuild it in their Marxist image, American coal production is taking a hit again just as demand for coal is skyrocketing thanks to renewed demand following the COVID-19 pandemic.
Only, there isn’t going to be enough to go around, unfortunately, and that will result in a dramatic loss of power for wide swaths of the country that still depend on coal-fired plants for their electricity.
As Bloomberg Green reports, coal miners will be busy next year:
Almost every lump of coal that U.S. miners will dig out of the ground next year has already been sold, as surging natural gas prices prompt utilities to burn more of the dirtiest fossil fuel.
Peabody Energy Corp., the top American supplier, has contracts for more than 90% of its coal from the Powder River Basin region next year and all of the power-plant fuel from its other U.S. mines. And Arch Resources Inc., the No. 2 producer, has lined up deals with utilities for all of its 2022 output from the basin at an average price that’s 20% higher than current spot prices.
Demand for electricity is surging as the global economy recovers from the pandemic and winter approaches, driving natural gas prices to record highs. Even with coal miners boosting output next year, power producers are signing multi-year contracts for every ton they can get.
“It’s pretty much sold out,” Peabody Chief Executive Officer Jim Grech said last week during a conference call. “We only have a small portion left to be sold for 2022 and for 2023.”
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Again, good news for coal miners (and for those concerned about the environment, as coal mining increased during the Trump years, U.S. emissions actually fell to their lowest levels since 1983 — and no, that’s not a misprint).
But there are several problems with this development:
— The demand for energy is increasing as the country and world emerge from the pandemic. But U.S. coal inventories are already sold out more than a year in advance; what happens if coal demand outstrips mines’ ability to produce it? That’s pretty simple: Power outages.
— What’s more, high demand coupled with low supplies equals inflation: Higher coal prices. And in fact, coal prices are already up, as Bloomberg Green noted.
— If power plants can’t get coal, many of them will burn natural gas. But it, too, has dramatically increased in price, so our electric bills will go up. They already are.
— If the Biden regime manages to get enough Democrats to finally come together and pass his massive spending bills, there will be “historic investments” in green energy production. But as we’ve seen in Europe, too much reliance on green energy is dangerous because wind doesn’t always blow and the sun doesn’t always shine. Plus, green energy is far more expensive to produce.
— Finally, the demand for energy will only increase as well with new ‘electric vehicle’ initiatives and incentives — at a time when a) we can’t produce enough energy; and b) what is produced is skyrocketing in price.
You may have hated Trump’s tweets, but he had our country energy independent. Biden’s Marxists have ruined that, and things are about to get a lot worse.
Sources include:
Image by hangela from Pixabay.
Ira Bershatsky offers consultations to those who want to invest in precious metals. During these consultations, he will match your current financial situation with the best physical precious metal purchases whether you want to rollover your IRA or have coins discreetly shipped to your home. You will not talk to a telemarketer or sales rep. You will talk to a true expert in precious metals with decades of experience helping people protect and advance their wealth.
