The coal industry’s impact on the U.S. economy is significant, primarily through electricity generation. Coal fuels a substantial portion of America’s electricity supply. Consequently, low coal prices translate to cheaper electricity, fostering economic growth.
Electricity, a $200 billion annual commodity, is indispensable to modern American life. Stable or decreasing electricity prices, driven by affordable coal, contribute to keeping inflation in check. These commodity price trends are reliable economic indicators, and low interest rates help protect savings and investments.
Furthermore, technological advancements and increased consumption of devices like computers and cell phones have driven electricity demand. When consumers purchase these technologies, they stimulate the economy both directly through the purchase and indirectly through the electricity required to power them.
There is a direct correlation between electricity usage and economic activity; a 1% increase in GDP typically corresponds to a similar increase in electricity demand.
Beyond electricity, the coal industry generates jobs, revenue, and tax contributions. It has created over 90,000 jobs in the United States and nearly 1 million worldwide, contributing $37 billion to American earnings, representing almost 1% of the total. The annual value of U.S. coal production is approximately $18 billion. Coal mining’s combined direct and indirect impact on the U.S. economy is $161 billion annually, or $596 per U.S. citizen.
Notably, states without coal mining operations, such as California and New York, also benefit economically from coal. In fact, every U.S. state experiences economic benefits from coal, as coal businesses contribute over $11 billion in federal taxes and $9 billion in state and local government revenues each year.