There's been a lot of talk over President Donald Trump saving the U.S. coal industry in recent months. The President even went so far as to withdraw the United States from the Paris Climate Agreement, under which the U.S. pledged to reduce its carbon emissions by 26% to 28% from 2005 levels by 2025.

But while the coal industry is clearly hurting, to some, it isn't dead yet. And it certainly isn't going off to pasture any time soon, Seaport Global Securities analysts argued in a Monday, July 11, research note. 

Seaport's Mark Levin and Nathan Martin pointed to a June 30 blog post by S&P Global Platts managing editor Andrew Moore, in which the coal industry follower said: "So far this year, the gas contract is averaging $3.10[per million British thermal units], which helps make coal competitive. Partly due to higher natural gas prices, the EIA expects power sector coal consumption to total 677 million [short tons] in 2017, and 687 million st in 2018. But even if gas dropped to $1/MMBtu, utilities would continue to burn coal. There just isn't enough natural gas to replace it."

Moore argued that the US power sector consumed 9,960 billion cubic feet of natural gas in 2016, or 34% of all U.S. electric generation. And even if one holds all other types of gas demand flat, U.S. natural gas production would have to increase from about 72 billion cubic feet of natural gas per day to 100 billion cubic feet per day, or 40%, to completely eliminate the need for coal.

"Even if these numbers are off by 20%, it would require discovery of another basin equal in size to the giant Marcellus/Utica shale plays," Moore wrote. 

As Moore explained, and SGS agreed, renewable energy is a real threat to coal energy, but renewables still make up just a fraction of the U.S. energy market. 

Wind and solar accounted for just 6% of total electric generation in 2016, SGS' Levin and Martin wrote. Moore broke it down further, explaining that utility-scale solar installations generated 36.1 terrawatt hours of electricity, or 0.9% of the nation's electricity, residential rooftops produced 19.5 TWh in 2016, or 0.5%, and wind produced a record high 294.1 TWh, or 7.2%. 

"Both [wind and solar] will grow rapidly and take market share," Levin and Martin wrote, adding that NextEra Energy (NEE) estimates the all-in cost of wind generation will only be 3 cents to 4 cents per kilowatt hour excluding tax credits and with a storage adder post 2020, versus coal costs of 3.5 cents to 5 cents.

According to Moore, it would take 170,000 new windmills to replace all of coal generation. That number might seem doable, but Seaport notes there are currently about 53,000 utility-scale windmills in the U.S., meaning the fleet would have to be tripled to replace coal entirely. 

"That's before even talking about the capital and time necessary to build out all of the infrastructure to transport//transmit all of this gas/wind," Levin and Martin added.

What does all this mean for coal? In the words of Moore, it means coal has a few decades of existence left at worst. 

In the meantime, however, Seaport's Levin and Martin suggested that there are plenty of issues facing coal today, especially in the so-called PJM region. The PJM Interconnection is a regional transmission organization that coordinates the movement of wholesale electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia. 

It is this region that faces the biggest headwind from natural gas, according to Seaport, largely because it is closest to the Marcellus Shale, where gas is both plentiful and cheap. Other issues that coal faces in the PJM region are the average age of coal plants, the relative inefficiency of many of these plants, and politics. Moreover, many senior utility executives have made it abundantly clear that their desire is to retire coal plants when the time comes, according to Seaport.

Those who stand to be affected the most by this over the coming years include privately held Murray Energy, Peabody Energy (BTU) , Alliance Resource Partners (ARLP) and Consol Energy (CNX) . Notably, Consol said Tuesday it intends to spin off the last of its coal operations into a separate, publicly traded company. 

Eastern rails such as CSX (CSX) and Norfolk Southern (NSC) will also feel the pinch from PJM region plant closures, according to Seaport's Levin and Martin.

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