Illinois' coal future: Arrows point up

Illinois' coal future: Arrows point up

Illinois has an abundance of coal that underlies more than 60 percent of the state, basically the lower two-thirds of Illinois, in what's known as the Illinois Coal Basin.

The state has the largest recoverable bituminous coal reserve of any state, according to a report by the U.S. Office of Surface Mining and Reclamation. And in the past two years, there has been a dramatic increase in total coal production in Illinois, according to Phil Gonet, president of the Illinois Coal Association.

He said federal environmental regulations that affect the coal industry were just one factor in the closing of the Willow Lake mine near Harrisburg and in layoffs at other Illinois mines last year. But Illinois coal production still increased in 2012, although the more than 40 million tons produced is far less than the 62 million tons Illinois churned out in 1990. That year, Gonet said, Congress passed the amendment to the Clean Air Act, reducing sulfur dioxide emissions, which was critical to Illinois coal, because it's high in sulfur.

So power plants had to decide how to reduce sulfur dioxide emissions by either installing pollution control equipment, like scrubbers that remove the sulfur dioxide from emissions, or by switching to burning lower-sulfur coal found in Wyoming.

Unfortunately for Illinois coal mines, he said, almost all the Illinois power plants switched to low-sulfur coal to meet the new federal limits.

By 2003, Illinois coal production had dropped to 31 million tons, a lot of coal mines went off-line, and coal mine employment decreased by more than half, which was the low point, Gonet said.

From 2003 to 2010, production in Illinois hovered around 33 million to 35 million tons of coal, but around 2008, three new coal mines were in the works and production began to increase, because new markets were found for Illinois coal.

About 85 percent of Illinois coal now goes out of the state to power plants in the East and Southeast, Gonet said, where plants have installed scrubbers.

And in the last couple years, Illinois has started exporting a lot of coal, he said, about 12 million tons in 2012. He said Illinois has an advantage in the export market, because of its access to waterways like the Mississippi.

As a result, coal production in Illinois jumped to 37 million tons in 2011, he said, a 14 percent increase over 2010. And other coal mines are either under construction or have just completed the permitting process and another has applied for an expansion.

He said the U.S. Energy Information Administration is estimating that Illinois produced 47 million tons of coal in 2012. When final numbers come out later this month, Gonet said, he believes the total will be closer to 45 million, but it's still a significant increase over 33 million in 2010.

And this year, he said, is the first that the three new mines will be producing for 12 months, so production could be over 50 million tons in 2013.

Whether the increase in production in Illinois continues, especially with more federal regulations, depends on coal companies that must decide whether it's feasible to come into Illinois to build a coal mine, Gonet said. Illinois coal is easier to mine, because the seams are generally thicker, so production costs are less, he said, but the question is whether there will continue to be a market for the coal.