The current gap between U.S. coal supply and domestic demand may widen as low cost natural gas becomes more attractive to electric power plants, and uncertainties with new environmental regulations discourage investment in new coal plants. Coal producers with excess supply will likely seek to expand their market abroad. Consequently, in the long run (over the next decade and possibly longer), U.S. coal exports are expected to rise. In the near term, however, the U.S. Energy Information Administration (EIA) projects coal exports to decline from a high point of 126 million short tons in 2012 to 107 million short tons in 2014. Growth potential in Asian coal markets seems large, but there are potential bottlenecks (e.g., lack of infrastructure, potential rising costs of regulation, competition from other fuels, and transportation), which could slow export growth. Also, limits on natural gas supply (for any number of reasons) would likely increase domestic coal prices and cut into exports. Although U.S. consumption of coal appears to be declining, other parts of world are increasing their use of coal. U.S. consumption of coal declined from 2011 to 2012. Coal production also declined, but exports rose 17%. The decrease in supply was driven, in part, by the decline in domestic demand. The EIA includes coal in its 2013 Annual Energy Outlook Early Release. In its reference case, net exports of coal may increase through 2040, increasing almost 50% from 2011 levels. Increased net exports could improve the U.S. trade balance as well as add government revenue from production on federal lands that might otherwise decline because of falling domestic consumption. Exporting coal may run counter to the current Administration's domestic environmental policies aimed at reducing greenhouse gas emissions (GHG), and affect current U.S. policy goals addressing global climate change and other environmental issues. Depending upon the location of the coal exports, certain parts of the country may benefit economically. Current and projected coal exports, issues associated with infrastructure, and the environment have prompted interest by Congress. Bills were introduced in the 112 th Congress that supported increased coal exports ( H.R. 3409 , S. 3450 ) and sought to limit exports ( H.R. 6202 ). Coal export-related issues that have raised congressional concern include carbon emissions abroad, coal dust from rail transport, infrastructure development (particularly port expansion), and federal coal valuation for royalty purposes, among others. Global production, consumption, and trading of coal have increased over the last decade, and are projected to continue growing. In fact, worldwide coal was the fastest-growing source of primary energy in 2011, according to the International Energy Agency's (IEA's) Coal Medium-Term Market Report 2012 . Coal consumption is projected to also grow more than oil or natural gas over the next five years, according to the IEA report, and reach parity with oil as the most used fuel source in the world. Worldwide, coal production has increased by nearly 60% since 2002, with most of the increase coming from China—a 130% rise. China accounted for about 50% of coal production in 2011, up from 34% in 2002. U.S. coal production has declined by 13 million tonnes of oil equivalent (Mtoe) over this time period. The data in Figure 1 illustrate that other countries such as Colombia, Indonesia, and India also had significant production increases since 2002. India's coal production grew by 60% over the past 10 years, while Indonesia's production more than tripled. Australia increased coal production by 26% over the same time period. At the company level, t he concentration of production worldwide is not significant. In 2010, the top five world coal producers account ed for about 18% of world production (Coal India (6%), Shenhua Group China (5%), Peabody Energy ( 3 %), Datong Coal Mining Group-China (2%) , and Arch Coal (2%) ) . The top 30 coal firms produce d 40% of world production. The United States ranked number one in the world in coal reserves in 2011, with almost 240 billion metric tons (mt) (28%). Russia was second with an estimated reserve base of 157 billion mt (18%), with China in third with 115 billion mt (13%). Taken together, the top three countries hold 59% of the world's recoverable coal reserves. When India and Australia are added, the top five coal producing countries hold 75% of world recoverable coal reserves (see Table 2 ). As a result of increasing electricity demand, global coal consumption has steadily risen over the last decade, an era of economic recession, which portends opportunities for increases in U.S. coal exports. The IEA projects that by 2017 coal use will be on par with oil as the top fuel in the world's energy mix (see Figure 2 ). Worldwide, coal is the largest contributor to primary energy growth, accounting for 65% of the increase in primary energy between 2010 and 2011. And, China's coal consumption was the largest contributor to the global growth in coal, up almost 165 Mtoe, in 2011 for about a 10% increase. Most of China's coal consumption is for its rapidly expanding electricity generation sector (see Figure 3 ). The global coal market in 2011 was over 3,700 Mtoe or 8.2 billion short tons (BST), up about 68% since 2000. This represents an annual average growth rate of roughly 5%, the highest among fossil fuels. China dominates the global coal market, accounting for almost half of global coal consumption in 2011. For comparison, the world's second- and third-largest coal consumers, the United States and India, account for 13% and 8% of global consumption, respectively. The European Union consumed about 8%. China's growing consumption of coal outpaced its production, taking that country from being a net coal exporter to a net importer. In 2000, China was the world's second-largest coal exporter, behind Australia. China started importing more than it was exporting in 2009 and became the world's second-largest importer, after Japan, according to EIA statistics. In 2010, net imports to China represented 5% of China's domestic consumption. International trade is more limited in coal than other fossil fuels. Roughly 15% of coal—1.2 billion short tons (BST) is traded globally versus 60% of oil and 30% of natural gas. The largest coal consumers are also the world's largest producers—China, the United States, and India. However, outside of China and India, most of the growth in global coal production has come from major coal exporters Indonesia (likely to curtail exports in the coming years for domestic use), Australia, Russia, and Colombia. Essentially, they are filling the space left in the market as China swung from being a net exporter to a net importer. Global trade in coal has averaged about 15% of world production, with the United States ranking among the top five exporting countries in 2010 through 2012. Australia, Indonesia, Russia, South Africa, and Colombia have also ranked in the top five coal exporting countries over the last five years. Meanwhile, Japan, China, South Korea, Taiwan, India, and Germany have ranked in the top five importing countries during those five years. Most notably, China climbed to be the second-largest importer in 2009, surpassing Japan for the top spot in 2012. The value of coal varies according to certain characteristics—energy content, ash level, sulfur content, moisture, and volatiles—while contracts include factors such as use, coal quality, length of contract, delivery terms, and payment options. These variables have made comparison of coals for export more difficult than for other hydrocarbons, which tend to be more uniform. Coal prices around the world reached a peak in 2008 and then fell sharply with the global economy, as did oil and natural gas prices. As prices rebounded in 2009, the gap between the U.S. benchmark Central Appalachia coal price and other international coal prices widened (see Figure 4 ). As more U.S. coal enters the global market, the additional demand will likely raise domestic prices while contributing low-cost coal to the world market. All else being equal, the additional U.S. low-cost coal might result in more coal being consumed worldwide. The United States has been exporting coal since the late 1800s. From 2003 to 2012, U.S. coal exports rose over 200%, mainly driven by competitive production costs, global demand, and lower prices, among other factors (see Figure 5 ). Coal exports comprised 12% of U.S. coal production in 2012. The recent U.S. economic crisis caused a sharp decline in U.S. 2009 exports over 2008, but exports are again trending up, more than doubling since 2009. U.S. coal exports were aided by a drop in value of the U.S. dollar against other currencies, including those of other major coal exporting countries, such as Australia, Indonesia, and Russia. Exports of both metallurgical coal and thermal coal from the United States have been increasing since 2009, rising almost 87% and 73%, respectively. Prior to 2009, exports of both had been on the rise, but the economic crisis stifled that growth. In 2011, U.S. coal exports broke 100 MST for the first time since 1992 and in 2012 reached 126 MST, surpassing their previous peak of almost 113 MST in 1981. The value of U.S. coal exports has increased, rising from under $10 billion in 2010 to almost $16 billion in 2011, according to EIA data (see Figure 6 ). Figure 7 shows a breakdown of coal exports by states. West Virginian coal accounted for the largest portion of U.S. coal exports.