The Dirt on Coal

March 30, 2007 at 6:35 pm
Contributed by: Chris


As promised, here is my take on the recent revelations about the impending global peak of coal production, originally published at Energy and Capital. This is really, really bad news.

Once again, I applaud the work of Richard Heinberg, upon whose shoulders so many of us stand.

More to come about this subject next week.

The final version of the Energy Watch Group report is available here:

The Dirt on Coal

By Chris Nelder

Friday, March 30, 2007

The peak of world production is only ten to fifteen years away.

The peak of U.S. production is in the past.

Reserves have been overstated by as much as 90%.

There are serious implications for our entire way of life.

And the media are still reporting that there will be abundant supplies for another 150 years, 200 years, or more.

I’m talking about oil, right?


I’m talking about coal.

That’s right, coal. The next great hope for fossil fuels.

Those are the conclusions of a forthcoming study by the Energy Watch Group of Germany.

Now, I never believed the oft-cited claim that the U.S. has a 200-year supply of coal. I know, having spent many an hour reading about energy, what such projections are made of. The assumptions usually aren’t stated, and when they are, you discover that they assume the rate of use will stay constant, that business as usual will continue along in a healthy economy, and so on.

Since U.S. domestic oil, natural gas and uranium are all past their peak production levels, many observers have pointed to coal as the next big practical source of usable hydrocarbons. They expect many users of those fuels to switch over to coal, which is abundant in the U.S., “the Saudi Arabia of coal.”

Indeed, by using production-scale applications of the Fischer-Tropsch process to turn coal into liquid fuels, some cornucopians have been eyeing coal as a big part of the solution to the peak oil problem.

So the rate at which we’re using coal couldn’t possibly stay constant. It would have to increase, and pretty markedly. That 200 years’ worth would turn into 50 right quick.

Still, it would be something. Enough to give us a few more decades to work on longer term solutions, to find a way to bridge the supply gap between the oil peak and a more sustainable, lower energy world filled with solar panels, wind turbines, and other renewable generators.

Our coal endowment has been a critical last bit of our proverbial rope.

Oops, We Did It Again

So it was with a sinking feeling that I read Richard Heinberg’s report on the EWG study in his Museletter #179 last week.

Turns out that, in terms of energy content, the U.S. passed its peak of coal production too . . . in 1998!

You see, various types of coal have different levels of energy content. The best stuff–anthracite (with 30 megajoules of energy per kilogram, or “30 Mj/kg”) from Appalachia and Illinois–has been in decline since 1990. Our “vast reserves” are mainly of lower-quality bituminous coal, delivering 18 to 29 Mj/kg, and sub-bituminous coal and lignite, delivering a mere 5 to 25 Mj/kg.

For comparison purposes, the energy content of the coal produced is translated into “tons of oil equivalent.” In terms of volumes of stuff mined, growth in U.S. coal production can continue for about another ten to fifteen years. But in terms of energy, which is the only metric that really matters, U.S. coal production peaked in 1998 at 598 million tons of oil equivalent, and fell to 576 million in 2005.

What’s worse, in a replay of the well-worn debate about oil reserves, it turns out that the global reserve numbers for coal have also been vastly overstated. The information we’ve had is decades old and unreliable, and modern reassessments by nice, transparent countries like Germany and the UK have resulted in 90% reductions.


The reserve numbers from Asia are particularly suspect, some dating back to the 1960s. China hasn’t reduced its reported reserve numbers in 15 years, even though we know they’ve produced some 20% of their reserves since then.

In fact, for the last 20 years, all major coal-producing nations that have updated their reserve numbers have adjusted them downward. And in the last 25 years, the global total reserve estimate has been cut by 60%.

The report’s authors conclude, “The present and past experience does not support the common argument that reserves are increasing over time as new areas are explored and prices rise.”

I’ve said it before, and I’ll say it again: when it comes to non-renewable resources, neo-classical economics just doesn’t work. So much for the Invisible Hand.

This is, most emphatically, not a growth scenario.

Quickly, then, let’s run the numbers:

In terms of world energy consumption, coal provides about one quarter of the total. Electricity production is 40% powered by coal. Two thirds of the steel industry relies on it for fuel, and that coal must be the high-energy kind.

In terms of world coal consumption, China uses 36%, the U.S. 10%, and India 7%.

In terms of coal production, China is the largest producer, and will hit its peak “within the next 5 to 15 years, followed by a steep decline.” The U.S. is the second-largest producer at 30%, and will likely peak between 2020 and 2030.

Total global reserves: about 909 billion tons. A little more than half of that is the good, high-energy stuff, and the rest is low grade. About 90% of all coal in the world is in just six countries: the U.S., which has the most, plus Russia, India, China, Australia and South Africa.

Here’s a useful chart:

coal chart

The Bottom Line

The absolute peak of global coal production will likely be around 2020 . . . approximately ten years, maybe less, after the global peaks of oil and gas.

The needle on the world’s fossil fuel tank is dropping toward the E.

That leaves us with precious little time to turn this ship around. Or, perhaps more accurately, to make this ship a whole lot more efficient. It’s time to think about putting up the sails and shutting down the engines, in order to stretch that last half a tank as long as we can.

With this new information, it’s time to update the bigger energy picture. I’ll do that next week.

Until then,



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