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Report: “Twenty years from now, most of the Illinois Basin coal industry will be gone”

Tuesday, Dec 10, 2019

* Press release…

The Illinois Coal Basin, one of the most important coal‑producing regions in the U.S., will likely see declining production and mine closures as the industry continues to contract in the wake of coal-fired power plant retirements and falling exports, concludes a report published today by the Institute for Energy Economics and Financial Analysis.

The report, Dim Future for Illinois Basin Coal, details how coal companies in Illinois, Indiana, and Kentucky, which are already facing challenging prospects, will most likely fade away over the next two decades. A significant number of the coal-fired power plants supplied by the three‑state Basin are already scheduled to be shut down by utilities while others are being run less and less often, trends that will likely continue.

“From the beginning of 2019 through 2024, at least 15 American plants that buy Illinois Basin coal—in Alabama, Florida, Georgia, Indiana, Kentucky, North Carolina and Tennessee—will be fully or partially retired,” said Seth Feaster, an IEEFA data analyst and lead author of the report. “That number, which reflects formal announcements by utilities, is likely to grow as the economics of coal-fired generation continue to deteriorate relative to renewables and gas.”

“Meanwhile, demand for Illinois Basin coal is shrinking in key overseas markets too, a trend driven by market forces similar to those at work in the U.S.: foreign competition, and increasingly attractive forms of alternative power generation,” Feaster said.

The report offers a company-by-company overview of the Illinois Basin coal industry, noting the coal-mining companies that stand to be affected include (in order of production level): Alliance Resource Partners, Murray Energy and its partner Foresight Energy, Peabody Energy, Hallador, Arch Coal and White Stallion.

IEEFA also notes that the rising number of mine idlings or closures in the past year or so by Alliance, Foresight/Murray, and Peabody may be insufficient to match falling demand from power plants or declines in exports in the wake of recent diminishing international market prices.

Report conclusions:

    * The Illinois Basin’s customer base in the U.S. continues to shrink as utilities move toward other forms of generation.

    * Export-market demand is trending downwards and will continue to do so because the same policy and market forces at work in the U.S. are also transforming power-generation business models in other countries and regions.

    * More Illinois Basin mines will close in the months and years ahead as the coal industry continues its structural and permanent decline.

    * Communities and areas that prepare for and are proactive in embracing the energy transition will fare best.

The report urges policymakers in Illinois, Indiana and Kentucky to prepare for impacts on industry workers and local households, community tax bases, businesses and the regional economy as a whole, as well as provide leadership and sound policy initiatives to take advantage of the changes that are taking place in the energy industry.

* From the full report

Twenty years from now, most of the Illinois Basin coal industry will be gone. Currently one of the major U.S. producing regions of thermal coal for domestic and foreign electricity generation, by 2040 it will have largely faded away as utilities shift to cleaner, cheaper generation resources.

- Posted by Rich Miller        

19 Comments
  1. - anon2 - Tuesday, Dec 10, 19 @ 12:32 pm:

    Apparently Donald Trump’s promise to reinvigorate the coal industry isn’t working.


  2. - ok - Tuesday, Dec 10, 19 @ 12:32 pm:

    ==The report urges policymakers in Illinois, Indiana and Kentucky to prepare for impacts on industry workers and local households, community tax bases, businesses and the regional economy as a whole, as well as provide leadership and sound policy initiatives to take advantage of the changes that are taking place in the energy industry. ==

    Yes.


  3. - Blue Dog Dem - Tuesday, Dec 10, 19 @ 12:40 pm:

    Probably. So let’s get going on doing some southern illinois fracking and gobble up some of that free natural gas to run them power plants. Clean baby clean.


  4. - ike - Tuesday, Dec 10, 19 @ 12:51 pm:

    Blue dog - “clean” except for those who’s drinking water became un-drinkable after fracking polluted their water supplies.

    Blue Dog, always there to support corporate interest over the common American citizen.


  5. - Ducky LaMoore - Tuesday, Dec 10, 19 @ 1:00 pm:

    This has been happening for a long time. Back in the day, long before I was born, coal mining was everywhere in my area. Now, it is long gone. The last mine closed a decade before I was born. Guess what? We are still here. Start planning now if you already haven’t if you are from that area. There is plenty of economic life left after coal.


  6. - Cheryl44 - Tuesday, Dec 10, 19 @ 1:23 pm:

    FTR, my grandfather was a coal miner. And yes, I do point that out at work when someone complains about how “hard” our jobs are.

    It’s past time they closed the mines, and I hope people are finding ways to lure alternative jobs that will pay living wages.


  7. - Just A Dude - Tuesday, Dec 10, 19 @ 1:40 pm:

    Ducky sounds like you could be from the area I grew up in. Macoupin county had many mines that were active from the early 1900’s to mid 1950’s. My parents and grandparents saw the boom and the bust. Many of the towns have been in slow decline ever since.


  8. - Generic Drone - Tuesday, Dec 10, 19 @ 1:40 pm:

    Was a coal miner for 10 years. Today those mines are closed, towns decimated, schools closed also. The impact goes beyond jobs.


  9. - Six Degrees of Separation - Tuesday, Dec 10, 19 @ 2:21 pm:

    Coal will continue to decline as cleaner and cheaper technology continues to grow. There may be opportunities to export, but these will also continue to decline. Disruptive? There arent’t too many telegraph operators anymore in a once-lucrative industry. Electric cars were a once-promising industry that went dormant for 100 years until they could get the cost and performance of a battery at the right point. I think we will still be using coal, oil and natural gas to some extent by the year 2100, but mostly for petrochemicals and some ancillary uses. Wiki lists 5 of the 16 coal-fired plants in IL as closing from 2019 to 2022, and one that only has one of its original 3 units operating.


  10. - Ducky LaMoore - Tuesday, Dec 10, 19 @ 2:33 pm:

    ===Many of the towns have been in slow decline ever since.===

    Looking at the population in my area. We have been in decline since the 1910s. And I really don’t know what will make it better. People have to want to live in a small town to make a small town flourish. We have fast internet, good and cheap infrastructure, 2 day Amazon delivery, a relaxed lifestyle, decent schools. The problem is a lack of high paying jobs, grocery stores and restaurants. The economy of a city is too much to overcome.


  11. - jdcolombo - Tuesday, Dec 10, 19 @ 2:55 pm:

    I grew up in deep Southern Illinois - Herrin, to be specific. The coal industry has been in decline since the 1950’s, and some towns I remember from my youth are basically gone - Ziegler, Sesser, Christopher, etc. But places like Mt. Vernon and Marion seem to be thriving.

    Not sure what the energy future is (I’m not yet sold on the safety of fracking), but there is good transportation infrastructure (both railroads and roads; no major airports, but decent small regional ones), good communications infrastructure, and a calmer life style. I know the big tech folks want cities, but . . . you could basically buy a whole town in So.Ill. for what a building in Chicago would cost . . .


  12. - Merica - Tuesday, Dec 10, 19 @ 3:24 pm:

    Rural towns and cities did it to themselves. It was the silly dream of every rural town, not be a rural town. To that end, they facilitated and welcomed every out-of-town restaurant, big box store, gas station, pharmacy, business loops, and unregulated real estate development. The measure of success became the presence of a walmart and applebee’s.

    The out-of-town stores drove the local small businesses bankrupt. The unregulated real estate development created excess supply and drove down the value of real estate.

    Now you’ve got few locally owned businesses, empty big-box stores, fewer people, deprecating homes and increasing real estate taxes.

    Wanna fix it? Embrace a unique rural identity and culture. Stop chasing a future that will never materialize. Embrace locally owned, and exclude out-of-town businesses that leach away community resources.


  13. - VerySmallRocks - Tuesday, Dec 10, 19 @ 4:14 pm:

    All the more reason to enact the Clean Energy Jobs Act and/or Path To 100 bills next spring and get serious about renewable energy and energy storage projects that can replace much of the coal extraction economy.


  14. - MyTwoCents - Tuesday, Dec 10, 19 @ 5:47 pm:

    Interesting to read this article and then see an article in The Southern Illinoisan about one of the worst coal mining disasters in the country that happened in Southern Illinois:
    https://thesouthern.com/news/local/way-past-due-west-frankfort-monument-planned-to-honor-men/article_507ccb9a-b889-5ffc-bb44-a5ae23917c45.html#tracking-source=home-top-story


  15. - AnotherAnon - Tuesday, Dec 10, 19 @ 6:36 pm:

    Cheryl, the governor’s proposed massive tax increase won’t be luring any job creators to southern Illinois.


  16. - Oswego Willy - Tuesday, Dec 10, 19 @ 6:41 pm:

    ===… governor’s proposed massive tax increase===

    Narrator: 3% of taxpayers will see any tax increase, and only of monies after $250K.

    Guess downstate Raunerites need to show they’re willing to recruit companies.

    Any downstate legislators that say they can’t, maybe they should think about another line of work?


  17. - AnotherAnon - Tuesday, Dec 10, 19 @ 6:53 pm:

    Right, because the poor and lower income are big job creators.


  18. - Oswego Willy - Tuesday, Dec 10, 19 @ 6:54 pm:

    === because the poor and lower income are big job creators.===

    lol… it’s this argument that will bolster the progressive income tax more than anything.

    “Save the wealthy”….”hil-arious”


  19. - Simple Simon - Tuesday, Dec 10, 19 @ 7:53 pm:

    Thankfully, society and technology are moving beyond coal. Bad for the atmosphere, the areas left mined, and the miners. However, we must be mindful of the impacts because the only thing worse than a mining job is not having a job at all, notably shown by opioid use rates in depressed areas.


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