Digging for Black Gold

While Americans have been transfixed by the spectacular rise in oil and natural gas prices and the fat profits of the oil giants, coal has quietly risen to prices not seen for nearly three decades…

Tight supplies at these utilities are among the causes of the rise in coal prices. The price of coal bought from central Appalachian mines for “spot,” or immediate use, has doubled since 2002. More important, long-term contract prices are also on the rise. That means big profits for companies such as Peabody Energy Corp., which reported a 141 percent increase in third-quarter earnings last month.

But their costs are also on the rise as they have had to dig farther into veins and grapple with transportation shortfalls. “The easiest, most technologically available, and best-quality coal is gone,” says Brenda Pierce, U.S. Geological Survey energy program coordinator.

U.S. News & World Report