Coal prices in Europe have plummeted from more than $90 per tonne at the beginning of 2013 to around $56 per tonne in May 2015.
According to Mintec, prices have hit lows “last seen before the financial crisis of 2008” due to weaker demand from China and Europe and cheaper oil.
Demand has also been affected by UK taxes on greenhouse gas emissions, which have almost doubled from £9.54 to £18.08 per tonne of CO2. Combined with the EU emissions trading system, this brings the cost of a tonne of carbon to £23 for British power plants, said Mintec.
“This is likely to be enough to move electricity generation from coal to less CO2 intensive gas, where possible, which was the overall aim of carbon pricing,” it said.