Economics Of Utilization Of High Sulfur Coal Resources -An Integrated Market Approach (PRIPRINT 92-152)

The United States has abundant coal resources that could last at least another century. and probably longer at present consumption rates. Geographically, the coal resources are distributed over the entire nation including Alaska, although there are no coal deposits in the highly populated areas on the two coasts. This allows free access to the coal, but makes transportation more expensive. Not all coals can be utilized equally because they differ vastly in quality. The sulfur content of coals, considered as the most detrimental acid rain-causing element, varies from as low as 0.3 percent in some areas of the western U.S. to 5 percent or more in parts of the Midwest. The chlorine content, which causes corrosion of plant hardware, also varies regionally. The 1990 amendments of the Clean Air Act of 1963 (CAA) require that emissions of sulfur be restricted and rolled back in two stages by the year 2000. There have been a number of reports expressing concern about the future of the industry in the states where high sulfur coal is produced. The remedies devised by the federal government and many coal-producing states in the past to "se-cure" the future of the regional coal industries have focused on the physical task of removing sulfur rather than the economic challenge of doing so at a cost that will enable high-sulfur coals to survive and compete. The past remedies, generally, were not specific enough to account for the characteristics of regional coal deposits and did not look at the coal market as an integrated national and international entity. The State of Illinois has, in recent years, taken a more comprehensive approach to the solution of the problem.