Peabody

IEEFA Research

Why Navajo Generating Station Is No Longer Commercially Viable

Why Navajo Generating Station Is No Longer Commercially Viable

The Institute for Energy Economics and Financial Analysis (IEEFA) has done extensive research into the difficult circumstances facing Navajo Generation Station. Key findings: Declining energy market prices and rising production costs have made power produced by the plant more expensive than competing sources. Market trends are not likely to change, leaving the plant’s financial viability […]

August 16, 2017 Read More →
IEEFA Report: ‘End of an Era’ for Navajo Generating Station; Vast Subsidies Would Be Required to Keep Aging Plant Online; Retirement Seen as Most Viable Option

IEEFA Report: ‘End of an Era’ for Navajo Generating Station; Vast Subsidies Would Be Required to Keep Aging Plant Online; Retirement Seen as Most Viable Option

‘No Longer Competitive’ With Rise of Natural Gas and Renewables; Staying Open Through 2022 Would Require a $740-Million-to-$1-Billion Subsidy; Through 2030 Would Require a $1.4 to $2.4 Billion Subsidy

May 10, 2017  (IEEFA.org) – The Institute for Energy Economics and Financial Analysis today published a report detailing how the failing coal-fired Navajo Generating Station in northern Arizona will require hundreds of millions of dollars in subsidies to remain online for any length of time. The report—“End of an Era: Navajo Generating Station Is No […]

IEEFA Research Brief: Coal in Decline, Blow by Blow

IEEFA Research Brief: Coal in Decline, Blow by Blow

Plant Closings and the Likely Effects on Specific Companies and Mines

We’ve published a research brief today that presents an expansive snapshot of a moving target: the decline in U.S. coal-fired generation nationally. As global energy markets continue to undergo rapid transformation, change has swept the U.S. as well. Our brief—“U.S. Coal Phase-out, Blow by Blow: Plant Closings and the Likely Corresponding Effect on Specific Companies […]

April 21, 2017 Read More →
IEEFA U.S. Coal Outlook 2017: Short-Term Gains Muted by Prevailing Weaknesses in Fundamentals

IEEFA U.S. Coal Outlook 2017: Short-Term Gains Muted by Prevailing Weaknesses in Fundamentals

Production Declining by as Much as 40 Million Tons; Prices Failing to Benefit Shareholders or Stimulate New Investment; Anemic Exports; Little or No Gain From Regulatory Relief; Increasingly Dim Employment Prospects

We’re out this morning with our annual outlook for U.S. coal markets, and the picture isn’t pretty. We see the potential for some short-lived strength in the current uptick for coal producers but the title of our assessment sums up the larger view: “Short-Term Gains Will Be Muted by Prevailing Weaknesses in Fundamentals.” You can […]

As Texas Coal-Fired Power Plants Close, Powder River Basin Mines Are Losing Their Largest Customers

Trends Will Force Closures and Complicate Efforts by Alpha Natural Resources, Arch Coal and Peabody Energy to Work Their Way Out of Bankruptcy

CLEVELAND, Aug. 3, 2016 (IEEFA.org) — The Institute for Energy Economics and Financial Analysis today published a report detailing how Powder River Basin coal producers are losing their largest customers as Texas power producers turn increasingly to other sources of energy. The report, “Texas’ Outsize Role in the Decline of the Powder River Basin Coal […]

August 2, 2016 Read More →
The Federal Government’s Coal-Leasing Program Is Broken: Here’s How to Fix It

The Federal Government’s Coal-Leasing Program Is Broken: Here’s How to Fix It

Appoint a Price-Setting Commission; Ban Exports; Cancel Some Leases; Eliminate Self-Bonding; Mandate Set-Asides for Mine Clean-up and Miner Pensions; Require Twice-a-Year Audits; Assume Smaller Markets

It’s time for the U.S. to modernize how it manages its publicly owned coal reserves. That’s the essence of comments we’ve filed today with the Department of the Interior as it begins a review of its federal coal-leasing program in the Powder River Basin, a program that has been mismanaged for years at taxpayer expense […]

Coal Won’t Solve the Energy Poverty Problem

Coal Won’t Solve the Energy Poverty Problem

Times Have Changed; Old Electricity-Generation Models Don’t Work Anymore

Coal-fired electricity is no longer the economy builder its proponents say it is. Time was when coal in fact did contribute to growth in many economies, but times have changed. Today governments and private interests worldwide concede—even emphasize—the economic and environmental dysfunction of coal. We’ve just published an IEEFA Briefing Note (“Energy Poverty, Then and […]

March 3, 2016 Read More →
If Peabody Is to Recover, It Must Close More Mines

If Peabody Is to Recover, It Must Close More Mines

The World’s Biggest Private-Sector Coal Company’s Current Turnaround Strategy Won’t Work

Peabody Energy, the largest private-sector coal-mining company in the world, is out with a dismal review today of its 2015 performance. The metrics unto themselves are damning, and Peabody’s plan for turning things around is even worse. In a report we’ve just published (with the Seattle-based Sightline Institute)—“Peabody’s Strategies for Survival Ignore Market Realities and Risks […]

February 11, 2016 Read More →
For U.S. Coal, Market Realities Grow Increasingly Harsh

For U.S. Coal, Market Realities Grow Increasingly Harsh

Debt Hurdles, Reclamation and Pension Challenges, Abandonment by Hedge Funds

We distributed a briefing note this week that delves into some of the many pressing difficulties confronting U.S. coal producers. In the note (“Struggling U.S. Coal Companies Face Debt Hurdles, Complications From Reclamation and Pension Obligations, Pressure from Hedge Funds”) we talk about how the cumulative impacts of the industry’s many mounting liabilities—reclamation costs, pension […]

PEABODY ENERGY:  Management Is Rewarded as Investors Lose and Workers Are at Risk

PEABODY ENERGY: Management Is Rewarded as Investors Lose and Workers Are at Risk

Peabody Energy Management Is Rewarded as Investors Lose and Workers Are at Risk By David Schlissel, Director of Resource Planning Analysis, IEEFA

April 29, 2015 Read More →

More News and Commentary

Peabody plans more cutbacks in U.S. coal production

S&P Global Market Intelligence ($): In the face of recent operational setbacks and troubling global economic indicators, Peabody Energy Corp. told investors it is focusing on “value over volume” with sharp reductions in U.S. thermal coal production but increased attention to its metallurgical coal operations in the U.S. and Australia, as well as the country’s […]

February 7, 2019 Read More →
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IEEFA Arizona: 10 follow-up questions for the Navajo Transitional Energy Company

Who runs the company, will Navajo Nation be left holding the bag, how many jobs will be lost, and will employee benefits be eliminated?

As the Navajo Transitional Energy Company presses forward with its proposition to acquire the failing Navajo Generating Station (NGS) and its supplier, the Peabody Energy-owned Kayenta Mine, concerns persist about the substance of the proposal and the liabilities that would come with it. While NTEC’s general counsel, Bernard Masters, revealed some fresh details yesterday before […]

U.S. coal companies continue to lose market value

S&P Global Market Intelligence ($): The 12 largest publicly traded U.S. coal producers lost 16.6% of their total market value since September 2018, with just one seeing an increase during the period. The companies’ total market capitalization was $12.68 billion on Sept. 27, 2018, and $10.58 billion as of Jan. 8, 2019, according to data […]

January 11, 2019 Read More →
IEEFA Arizona: ‘Post-coal reclamation economy’ seen after closure of Navajo Generating Station and Kayenta Mine

IEEFA Arizona: ‘Post-coal reclamation economy’ seen after closure of Navajo Generating Station and Kayenta Mine

Site remediation will involve thousands of acres and require hundreds of skilled workers; public pressure on Peabody may be required for ‘proper cleanup’; responsible repurposing of NGS infrastructure will include development of utility-scale solar and emerging electricity-storage technology

Dec. 7, 2018 (IEEFA) — Land reclamation and site remediation around the coal-fired Navajo Generation Station and its companion Kayenta Mine in northeastern Arizona will require years to complete and likely employ hundreds of  former plant and mine workers, concludes a  research brief published today by the Institute for Energy Economics and Financial Analysis. The report—“Long-Term […]

December 6, 2018 Read More →

Powder River Basin coal production continues falling

S&P Global Market Intelligence ($): Coal mines in the Powder River Basin bounced back from the rain-soaked second quarter, increasing production 18.9% in the third quarter, but still saw year-over-year declines. Ten of the top 16 mines reported production decreases from 2017, lowering the region’s output by 5% to 86.6 million tons, according to data […]

November 13, 2018 Read More →

Cautious investors keep lid on U.S. metallurgical coal expansion

S&P Global Market Intelligence ($): U.S. metallurgical coal producers have enjoyed supportive international pricing trends since fall 2016 but continue to report logistical and capital constraints keeping a lid on further growth. The industry has had two years to get comfortable with improved metallurgical coal pricing after a years-long downturn in prices for the commodity […]

November 8, 2018 Read More →

IEEFA U.S.: Coal inventories are down at utilities, yes, but that doesn’t mean they’ll be replenished

The tone of third-quarter earnings reports suggests producers aren’t quite getting the picture

The U.S. coal industry’s third quarter earnings reports are out, and one theme is repeated over and over again: Utility-coal inventories are low, which—according to producers—will boost domestic thermal sales going forward. Arch Coal, for example, points out that domestic utility inventories are currently “at the lowest level in four years in terms of days […]

November 7, 2018 Read More →

Navajo Generating Station purchase falls through

Bloomberg: Private equity company Middle River Power LLC is ending its bid to buy Navajo Generating Station, the biggest coal-fired power station west of the Mississippi River. The collapse of the deal deeply threatens the survival of the coal-fired power plant in Page, Ariz., which is slated to close at the end of 2019 unless […]

September 21, 2018 Read More →

IEEFA update: Peabody continues to grapple with decline

Lease relinquishments are a sign of deeper trouble

In Peabody Energy’s recent relinquishment of some of its federal coal leases, the company is cleaning up its production cost side in the face of declining demand, particularly for the lower-quality 8400 BTU product that comes out of the Powder River Basin. The particular Wyoming coal in question has gone from being an asset to […]

September 20, 2018 Read More →

Wyoming moves forward with self-bonding limits

Casper Star Tribune: Wyoming’s largest coal mines would effectively be banned from self-bonding if the proposed rules that passed an advisory board Wednesday make it through one more round of public input and onto the governor’s desk. At a sparsely attended meeting in Casper, citizen members of the Land Quality Advisory Board voted 4-1 to […]

September 20, 2018 Read More →