LOW SULPHUR COAL: A REVISION OF RESERVE AND SUPPLY ESTIMATES. APPENDIX C

Conventionally, the definition of low sulfur coal, on which traditional reserve and supply estimates are based, depends only on the weight of sulfur in a ton of coal. The Btu content of the coal is not considered. Coal purchases and SO2 regulations are based on Btu content. A recalculation of reserve estimates of low sulfur coal on a utility average Btu basis reduces traditional U.S. estimates by over 75 percent and Western estimates by almost 85 percent. When calculated on a Btu basis, maximizing low sulfur coal production results in a supply shortage by 1985. The policy implications for an increased dependence on domestic coal include increased cleaning of high sulfur coal and export limitations on low sulfur coal in the short-term. In the mid-term, large capital expenditures in R and D and processes which reduce or eliminate the sulfur content are required. These include stack gas scrubbing, gasification and liquefication. For the consumer, some of these costs can be offset by the elimination of the transportation charge differential between local high sulfur coal and coal from Wyoming, Colorado and Montana.