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DOCUMENT RESUME
04550 - ( 0044947]
The 3tate of Competition in the Coal Idustry. !ED-78-22;
B-151071. December 30, 1977. 58 pp. * 4 appendices (12 pp.).
Report to the Conjress; by Elmer B. Staats, Comptroller General.
Issue Area: Energy (1q00); Energy: Effect of Federal Financial
Incentives, Tax Policies, and Regulatox Policies on Energy
Supply (1610);Land Use Planning and Control (2300).
Contact: Energy and Minerals Div.
Budget Functi4.i: Natural Resources, Environment, and Energy
(300); Natux.,l Resources, Environment, and Energy: Energy
(305); Hatural Resour-es, Environment, and Energy: Other
Natural Resources (306).
Organization Concerned; !.xecutive Office of the President.
Congressional Relevance: Congress.
Authority: Clean Air Amendments of 1970 (42 U.S.C. 1857).
Federal Coal Leasing Amendments Act of 1975. Fedezal Coal
Nine Health and Safety Act of 1969.
A major part of United States energy policy is the
maiztenance of competition in the energy sactor cf the economy.
Ronopcly power is genorally ptesumad to ezist when industrial
organi ,aticn has A four-firm concentration ratio ot 50% or more.
Estimates of concentration ratios in American manufacturing as a
whole range from 38% to 40;. Findings/Conclusions: On the basis
of 1976 production, the concentration ratio in the coal industry
is as follows: the top 4 firma; conv.rol 255, the top 8 f.res 34%,
and the top 2C firms 50%. Concentration ratios s ince 1950 shcwed
a trend towards an increase during the 1950's and 1960's but a
decrease since 1970. A viable -tate of competition exists in the
coal industry and, unless circumstances change, domination by
any firm or group of fires is unlikely. control of current
production is shared by numerous firms and cwnership cf coal
reserves is dispersed even mo-e. On a natioawide basis,
petroleum firms accuunt for less than 20% of total prcduction
.end even less cf ccal reserves. The degree cf competition
varies. In the Eastern market, large numbers of firms actively
cooepst* in both contract and spot sales; reserve ownership is
well dispersed. In the two Western markets, huvevwr, the
situatiou is dynamic and requires th-a continued vigilance by the
Federal TraCe Conmissicn, the Departuent of Justice, and the
Intericr Department through its coal leasing program.
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