World's largest coal producer files for bankruptcy

Peabody Energy, the world's largest privately owned coal producer, has filed for bankruptcy in the US, a move that some see as an omen for an industry threatened by falling demand and tightening environmental regulation.

Financial analysts have blamed the company's collapse on tumbling commodity prices and a mistimed and debt-fuelled expansion into Australia. The price of coal has plunged by 75 per cent since its peak in 2011.

But with coal losing out to gas and renewables as the major source for generating electricity, many are predicting yesterday's announcement may be the beginning of the end for the sector.

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"Phasing out coal in favour of cleaner forms of energy, like natural gas or renewables, is a process which is accelerating around the world," Richard Black, of the UK's Energy and Climate Intelligence Unit, said.

That process should only be furthered by a far-reaching agreement signed by world leaders in December to limit global temperature changes to "well below" two degrees Celsius. Most scientists agree that is only possible if most remaining fossil fuel stocks remain in the ground.

There will be little sympathy from environmentalists, who have "long been antagonised by what they saw as the aggressive proselytising of a carbon-heavy fuel at a time of global warming", says The Guardian.

Britain has promised to phase out coal from use in its energy sector by 2025, with a controversial expansion into nuclear and gas, alongside renewables, coming more to the fore.

There is also likely to be more of a business incentive to more away from carbon-intensive energy sources, as policies shift and the focus of climate change falls on ways to mitigate £424bn of cost to the global economy.