Monday, July 7, 2008
Now we have a problem
Most of the time, the weekly coal price update from the Energy Information Agency isn't all that interesting. However, in recent months the spot price of eastern low-sulfur coal has broken loose of its historical range and rocketed up into new territory. This is a problem because utilities have been counting on coal to keep providing cheap power while the price of natural gas bounces around. If coal isn't cheap, the price of electricity can no longer be held in check. The legendary mines of Wyoming's Powder River Basin are a thousand miles from anywhere, and the trains hauling that coal use a lot of diesel--high energy prices have pushed through the final line of defense. Now we have a problem.