The Wall Street Journal has an important story today delving into the question of whether U.S. coal stocks are actually as boundless as everyone's long believed. No question, there's still plenty of coal underground, but those reserves may not be as easy (or as cheap) to dig up as once thought:

Every year, federal employee George Warholic calculates America's vast coal reserves the same way his predecessors have for decades: He looks up the prior year's coal-reserve estimate, subtracts the year's nationwide production and arrives at a new official tally.

Coal provides nearly one-quarter of the total energy consumed in the U.S., and by Mr. Warholic's estimate, the country has enough in the ground to last about 240 years. A belief in this nearly boundless supply has led officials to dub the U.S. the "Saudi Arabia of Coal." But the estimate, recent findings show, may be wildly overconfident.

While there is almost certainly as much coal in the ground as Mr. Warholic's Energy Information Administration believes, relatively little of it can be profitably extracted. Last year, the U.S. Geological Survey completed an extensive analysis of Wyoming's Gillette coal field, the nation's largest and most productive, and determined that less than 6% of the coal in its biggest beds could be mined profitably, even at prices higher than today's.

"We really can't say we're the Saudi Arabia of coal anymore," says Brenda Pierce, head of the USGS team that conducted the study.

No one says the U.S. is facing a coal shortage. But the emerging ranks of "peak coal" theorists argue that current production levels may be unsustainable and, if anything, create a false sense of security. David Rutledge, an electrical-engineering professor at the California Institute of Technology who has studied global coal production, figures the U.S. has about half as much recoverable reserves as the government says, which would work out to about 120 years' worth.

Granted, if coal prices soared upward—say, from $6 per ton to $50 per ton—then mining companies would be able to extract a far greater portion of those existing reserves. Trouble is, at that point, coal wouldn't be nearly as cheap—its main selling point, and the chief reason it supplies half the country's electricity—and it would struggle to compete with wind power or nuclear or natural gas.

Plus, as Keith Johnson points out in this excellent post, these findings have potentially large implications for coal-fired plants that capture and sequester their carbon—a still-unproven technology that represents the industry's great hope for surviving in a low-carbon world. Such plants already face steep economic hurdles, not least because it's still quite expensive to store the carbon underground. But the CCS plants also require up to 30 percent more coal than conventional plants to produce the same amount of energy. If cheap coal's not nearly as plentiful as once thought, they'll have a tougher time competing against alternative sources of clean power.

(Flickr photo credit: wallyg)

--Bradford Plumer