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Rahall: Decrease in Coal Demand is Temporary

WASHINGTON, D.C. — U.S. Rep. Nick Rahall says he hopes the demand for coal will increase soon so out of work miners can start work again.

Several southern West Virginia mines have shut down recently due to a decrease in demand for coal. Hundreds of miners across the coalfields are without jobs and Rahall said last week in an exclusive interview with The Logan Banner that he believes the coal mines will see an increase in need for coal.

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'Alternative' Energy Costlier than Coal

West Virginia legislators appear ready to give Appalachian Power, whose service area includes Ohio and Marshall counties, authority to sell bonds the company wants to use to hold electric rates down now - probably at the cost of higher ones in the future.

From the company's standpoint, the idea makes sense. It would allow Appalachian to avoid a sudden price jump of 30-40 percent, instead spreading the burden out over several years to come.

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Correlation is not Causation

"Correlation is not causation" is a statistics mantra. It is drilled, military school-style, into every budding statistician. But what does it actually mean? Well, correlation is a measure of how closely related two things are. Think of it as a number describing the relative change in one thing when there is a change in the other, with 1 being a strong positive relationship between two sets of numbers, –1 being a strong negative relationship and 0 being no relationship whatsoever.

"Correlation is not causation" means that just because two things correlate does not necessarily mean that one causes the other. As a seasonal example, just because people in the UK tend to spend more in the shops when it's cold and less when it's hot doesn't mean cold weather causes frenzied high-street spending. A more plausible explanation would be that cold weather tends to coincide with Christmas and the new year sales.

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Coal Production Sees Sharp Drop

West Virginia’s coal industry is currently being hit by a “perfect storm” of regulatory and market factors and the result has been a sharp drop in production – in both the southern and northern coalfields.

According to the EIA’s latest weekly report, while coal production nationwide has slipped just 0.3 percent and West Virginia has seen a drop of just 0.5 percent for the year ending 2/12/12, the more recent trends have shown a steep drop in production – down 2.4 percent nationwide for the year-to-date. In West Virginia, meanwhile, year-to-date production is off 7.2 percent from the same period in 2011 – to just 15.4 tons compared to 16.6 million tons last year.

This sharp decrease is fueled by both a drop in demand as the nation’s utilities work through stockpiles of coal left from a mild winter and decreased demand for met coal because of the economic uncertainties around the world, as well as regulatory uncertainty caused by the Obama EPA’s on-going assault on coal.

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WVCA & State Journal Team Up Again

Planning is underway for this year’s WV Coal Association’s State Journal insert. This special publication will print in late-July.  It is a great opportunity to get the message out that coal is and will remain the economic bedrock of the state’s economy. This past year’s edition included production, employment, coal severance data, membership profiles, editorial features and other key information.