coal price hikes raise electrical rates

[greenman3610]

"cheap" coal isnt.

http://www.chron.com/disp/story.mpl/ap/business/5736436.html

As more of the world develops and uses more energy, and supply tries to keep up with demand, we're going to have these pinch points," said Carol Pfeiffer, director of fuels for the U.S. for utility giant E.On AG.

Central Appalachian coal, a benchmark grade that's widely used by power plants, has jumped from around $40 a ton in early 2007 to almost $90 a ton now. Coal from the Powder River Basin in Wyoming and Montana, which has about three-quarters the heat content of Central Appalachian coal, jumped from less than $10 a ton to almost $15 a ton over the same time period.

Utilities must burn more Powder River Basin coal to generate an equivalent amount of energy, and it must travel east by rail, which adds significantly to its final cost. Utilities such as Columbus, Ohio-based American Electric Power Co., for instance, mostly burn Appalachian coal in their eastern plants, but rely on cheaper Powder River Basin coal in the west. Some American Electric plants are designed to burn only the types of coal they're near.