The free market will be the death of coal

The Trump administration has promised to revive the coal industry—but does the free market even want it?

As recently reported by the Associated Press, the federal government was left with no choice but to reject the only bid for a 167-million-ton coal lease in Montana after the offer came in at less than a penny per ton. The administration also suspended the bid process for another coal deposit in Wyoming. In other words, there’s simply no real demand.

Coal plants have long been in the crosshairs for their role as major sources of greenhouse gas emissions. But climate change is only part of the story behind coal’s rapid decline in the U.S.

Good old-fashioned capitalism is finishing the job.

Natural gas is cheaper, and wind and solar are even cheaper than that. Coal-fired electricity costs roughly $90 per megawatt hour. By comparison, gas can cost as little as $45 per megawatt hour, while wind and solar can fall as low as $25.

Despite these market realities, the administration has ordered utilities not to shut down coal plants slated for retirement and has floated federal subsidies to keep them running—which sounds a lot like a handout.

These policies would force customers to pay higher power bills solely to keep aging coal plants alive.

Despite these acts of desperation, the decline of the coal industry is likely to continue—if not because of climate change, then simply because it’s no longer economical.