Coal Info . Furthermore, when we take a look at the actual energy equivalent costs of coal and natural gas, coal is 114% cheaper. Total costs are the only thing utilities care about; if coal is cheaper than natural gas on an energy generation basis, then coal will be used. Simple stuff.
Now, even in the best case scenario, where a president Romney is able to repeal the vast majority of regulations (a tall order considering potential lawsuits from environmental groups, federal courts etc.), coal prices will have to remain depressed around $60/ton, and natural gas prices must remain significantly above ~$2.50. State pollution laws will remain in effect, and many utilities companies have already built the infrastructure for gas burning; without these specific commodity values, coal will have a difficult time remaining competitive. Fortunately, though I expect natural gas prices to decline in the intermediate term, the commodity seems to have a strong floor around $3/mmbtu.
Though the long-term outlooks for coal companies remain challenging, current industry valuations seem to reflect very muted expectations. A Romney election should have a significant effect on both investor expectations and actual fundamentals, given time.
My advice for longer-term investors is to make sure your coal companies do plenty of business in the international markets. The U.S. electricity generation market is unlikely to revert completely back to the days of ultra-friendly coal policies, and an investment made solely on the prospects for U.S. coal demand needs to be cushioned by strong demand elsewhere. Peabody Coal, for example, has an enormous Australian business and is ramping up investments in China, where policies favor coal and natural gas isn't competitive.
While coal stocks as a whole should do well in the event of a Romney election, the real outperformers during a Romney administration will be U.S. coal producers with strong international exposure and healthy balance sheets.