Keeping Electricity Prices Low for American Business

America’s economic health is on everyone’s mind these days. And how we rebuild our economy and create jobs is at the forefront of our national debate. Providing businesses with a reliable supply of affordable electricity is key to getting our economy back on track so we can maintain existing jobs and create millions of new ones.

Olivia Albright, owner of AOA Products in Toledo, Ohio, understands this from experience. She depends on affordable electricity to operate her packaging machines – and leave her with enough money to meet payroll. Without it, she might have to cut her employees’ hours or lay off some of her staff.

Coal, and coal-fueled power plants, can also be a boon for local economies.

Just ask the people we met at a America's Power Tour in Bay City, Mich. Local business owners and patrons alike laud the Karn/Weadock power plant for helping their town cope amid the tough times much of the state has experienced. Read more +

Besides being affordable, coal prices have remained relatively stable. By comparison, average annual natural gas prices have fluctuated significantly between a low of $2.16/MMBtu in 1991 and a high of $9.66/MMBtu in 2005. But over the same period, coal prices have varied modestly – from a low of $1.20/MMBtu in 2000 to a high of $2.52/MMBtu in 2008. Going forward, EIA projects that the price for natural gas will increase by 60 percent by 2030, while coal prices are projected to decrease by 2 percent in that same time period.

Those low fuel prices mean, historically, it has cost less to generate electricity with coal than it has with natural gas – and the resulting savings have typically meant more money for American businesses to keep people employed and continue to provide affordable services and goods that consumers want.

In fact, a study conducted by researchers at Pennsylvania State University, and funded by ACCCE, looked at direct and indirect jobs associated with coal because of access to low-cost energy. The study found that U.S. coal production, transportation and consumption for electric power generation will contribute more than $1 trillion of gross output – including 6.8 million jobs – directly and indirectly to the economy of the contiguous United States in 2015.

Coal’s affordability adds up to more money in the pockets of U.S. consumers, a better bottom line for business and a more vigorous American economy. <<