The Age of Coal is over: It’s time to deal with it

(Image: Pixabay)

The days of coal being a relevant power source are coming to an end, and there’s little that can probably stop it. Some of the United States’ largest and most successful coal companies are closing their doors after their market value vastly diminished in 2019. By the end of the year, US coal companies were trading at half their rate compared to the beginning of 2019, indicating a serious stalling in the sector’s effectiveness as the nation’s preferred energy source.

The SNL Coal Index sank 53.5% from December 30, 2018 to the same day a year later, according to S&P Global. The growth of sustainable energy platforms and Earth-friendly programs from some of the world’s largest corporations are contributing to a change in tune from Wall Street.

Overall, trends appear to be headed no longer on the once-booming coal industry that about 25% of the world has recognized as its primary energy source. Instead, investments have largely been geared towards companies that are focused on environmentally-conscious forms of energy and power, according to the International Energy Agency (IEA).

In the past five years, a number of coal companies have filed for bankruptcy in an attempt to save their businesses. This includes Peabody Energy Corporation, which is recognized as the largest coal company in the United States. Peabody CFO Amy Schwetz said that “We remain committed to shareholder returns as a basic tenet of our investor appeal, understanding that modest deleveraging and reduced coal pricing moderate our near-term cash flow generation.”

Other companies, like Foresight Energy LP, have not been as lucky and were removed from the New York Stock Exchange.

The issue is that coal companies are not likely to receive any sort of help from the federal government. Only 25% of American electricity generation is derived from coal compared to 45% in 2010, according to the U.S. Energy Information Administration. This is expected to drop even more in the coming years, according to analysts from Morgan Stanley and Moody’s Investors Service. Both financial firms estimate that coal could drop as low as 8% by the year 2030.

The appeal is simply not with coal anymore. Even President Donald Trump’s “War on Coal” has crumbled into nothing as companies that once ruled the sector have dissipated. The focus seems to have transitioned toward solar and wind energy as prices for both have dropped while the technology for both continues to improve. People are seeking sustainable ways to power their homes, businesses, and cars. This is evident through the undeniable growth of the sustainable energy industry.

Joey Klender: Transportation Writer | Penn State Alum | Future World Series of Poker Bracelet Holder 🚀 🛰 ☀️ 🚘 🧠 🕳
Disqus Comments Loading...