Steam versus coking coal and the acid rain program

Abstract

The Clean Air Act of 1990 initiated a tradable permit program for emissions of sulfur dioxide from coal-fired power plants. One effect of this policy was a large increase in the consumption of low-sulfur bituminous coal by coal-fired power plants. However, low-sulfur bituminous coal is also the ideal coking coal for steel production. The analysis presented here will attempt to determine how the market responded to the increased consumption of low-sulfur bituminous coal by the electricity generation sector. Was there a decrease in the quality and/or quantity of coking coal consumption or did extraction increase? Most evidence suggests that the market for coking coal was unaffected, even as the extraction and consumption of low-sulfur bituminous coal for electricity generation increased substantially.