U.S. Coal Production Rises Slightly In 2011

U.S. coal production increased slightly during 2011 for the second year in a row, rising about 0.4% from from its 2010 level, after falling sharply during 2009, according to EIA's weekly coal production report. Exports drove gains in production, as U.S. coal shipments to other countries climbed to their highest level in two decades, while domestic coal consumption for electricity generation fell.

Production varied by region. Western coal production, which includes the Powder River Basin in Wyoming, declined 1.2% last year to 584 million short tons. Western coal has lower sulfur content and much of it is used as fuel to run power plants because it produces fewer emissions than coal mined in other parts of the country. However, the decline in western coal output mirrored the drop in electricity generation from coal, as utilities switched to more affordable natural gas to fuel their power plants. Western production was also affected by severe flooding in the spring and summer, particularly Montana, which had a decrease in production of 7% from 2010. The decrease in Montana production was enough to move it out of the top five producing states.

Appalachian coal output increased 0.6% to 339 million short tons. The region produces bituminous coal, which is used for both electricity generation and as metallurgical coal to produce coke that is used in the steel-making process. The increase in this region's production reflects the large jump in exports, of which a large portion is metallurgical coal.

Production from the Interior region of the United States rose 6.4% to 166 million short tons. Coal production in Texas was up nearly 4 million short tons in 2011 and accounted for about 40% of the Interior region's output increase. Several power plants that run on coal went online in Texas in 2010 and 2011. Most of this region's coal is used to generate electricity.

Of the total coal consumed in 2011, about 93% was used in the electric power sector. However, electric sector coal consumption fell last year by an estimated 40 million short tons, or 4%, compared to 2010, as attractively-priced natural gas encouraged operators to increase the use of natural gas-fired generation to service load, according to EIA's February Short-Term Energy Outlook (STEO). At the same time, projected U.S. electricity generation was down about 0.3% last year.

Much of the coal that was not used by utilities was transported by train, in most cases, to major U.S. seaports where it was exported. Flooding last year disrupted the coal mining in Australia, the world's largest coal exporter, contributing to increased United States coal trade with India, Japan, and South Korea.

The United States exported a total of 107 million short tons of coal in 2011, up 31% from the year before and the most since 1991, according to the STEO. U.S. exports of steam coal, used mainly to fuel power plants, were an estimated 37 million short tons in 2011, the highest since 2008. Estimated exports of metallurgical coal reached record levels in 2011, about 70 million short tons.  (DOE-EIA)