Coal Demand, Market Forces, and US Coal Mine Closures

Brett Jordan, Ian Lange and Joshua Linn

No 18-13, RFF Working Paper Series from Resources for the Future

Abstract: Economic transitions have the potential to displace workers and cause social unrest. Coal mine closures in the eastern United States due to the changing electricity system and the resulting employment losses in rural areas have become salient issues for all levels of government. Previous research has not distinguished among the potential causes of recent mine closures, such as rising production costs and decreasing coal demand from the electricity sector. This analysis utilizes unique data on coal mine and power plant operation to estimate the impact of supply and demand factors on mine closure. We model closure as a function of expected pro ts, which allows us to compare the effects on mine closure of specific demand and supply shocks to expected mine pro ts. Our results suggest that each shock substantially affected coal mine employment. Increasing costs of producing Appalachian coal have had the largest impact on closures with lower natural gas prices and lower electricity demand each accounting for a substantial number of closures additionally.

Date: 2018-04-04
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Related works:
Journal Article: Coal demand, market forces, and U.S. coal mine closures (2023)
Working Paper: Coal Demand, Market Forces, and US Coal Mine Closures (2018)
Working Paper: Coal Demand, Market Forces, and US Coal Mine Closures (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:rff:dpaper:dp-18-13

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