Clinker of woes besets a once and future king

King Coal. Finally, the much-touted liberator of the United States from foreign oil could retake the energy throne.Or so it would seem. * The Reagan administration promises to rework the Clean Air Act, the strip-ming law, federal land access, and various regulations that now slow coal's increased use and production.

* Europe and other parts of the world want to buy more US coal as they switch from burning of high-priced oil from the Organization of Petroleum Exporting Countries.

* Rail deregulation last year and new investments in exporting port facilities will help unclog transportation bottlenecks that have helped block greater use of the nation's 265-year reserve of coal (at 1980 production rates).

And yet, the bright signs of optimism are dimmed somewhat, for a number of reasons:

* While the coal industry produced a record 830 million tons last year, it could have turned out another 150 million tons more, but buyers were hard to find and demand was so sluggish that production increased just 5 percent, a rate that many expect to continue through the decade.

* Coal's main customer -- electric utilities -- are facing serious financing problems that prevent many of them from expanding their generating capacity with new coal-fired plants, or converting to coal if they are burning oil.

* Worst of all, hopes for a coincidence of surging world demand and labor peace have been dashed by this year's United Mine Workers (UMW) strike. While the union's share of US coal has decreased dramatically since 1970 -- from over 70 percent to around 45 percent -- the perception of the US coal industry as a dependable supplier to domestic and overseas markets is considered seriously eroded.

"The outlook for the industry . . . is not nearly as rosy a everyone perceives it to be," said Jack Kawa, coal analyst with Wheat First Securities in Richmond, Va. "The industry's profitability has not been good for three or four years. Domestic use of coal has not grown nearly as fast as people expected three or four years ago."

A major reason for this lack of demand, Mr. Kawa says, is that Americans did what they were told: They saved electricity. "Conservation has played a big, big role. Demand for electricity overall has been far less than people expected three or four years ago. Every time I do a prediction, the demand for electricity on a long-term basis gets shaded back.

"And the amount of use by electric utilities of natural gas has not declined nearly as fast as everyone thought."

In 1981, says Susan E. Martin, coal analyst with Data Resources Inc. of Lexington, Mass., utility fuel consumption is expected to fall for the second year, this time by about 1 percent. Coal will be the only fossil fuel to show an increased use by utilities, Miss Martin believes. In the first half of 1980, for example, total demand for electricity went down by 1.5 percent. Coal use by utilities during the same period was up 9 percent.

The analysts interviewed expect coal's part of the electric generating business to continue increasing from its present share of about 48 percent to approximately 55 percent by 1990 and to 60 to 62 percent by 2,000.

Much of this increase, however, will have to come later in the decade. With consumption down and interest rates up, utilities simply cannot raise the money needed to build many new coal-fired power plants or convert existing oil-fired plants to coal.

But when more plants are burning coal, the resource will be able to fulfill some of its promise, these analysts believe. "Coal has such a powerful cost advantage," says Joseph C. Lang Jr., an economist with the Pittsburg National Bank, "and it has the advantage of being plentiful, that it's sort of going to be the wave of the future.

"In the first half of the 1980s, a lot of the increase in coal [production] will be exported and then in the latter half, I think we will start using more of it ourselves."

Exports, Mr. Lang believes, could be a major factor in improving the balance sheets of coal companies in this decade. "Exports have been running 12 to 13 percent of US output," he said. "This could increase to as much as 25 percent by 1990." Also helping the coal companies, he adds, is the fact that the US should be producing over 1 billion tons a year by 1990 and "25 percent of 1.1 billion is a lot bigger than 12 percent of 830 million tons."

The coal companies will also be helped, Mr. Lang expects, by the realization that, for electric power generation, "coal and nuclear are your choices . . . and I'm not optimistic nuclear will advance very much at all."

If coal is to advance very much at all, the US will have to put in place a much improved system of transporting, delivering, and storing the stuff. One thing that will help, says Vincent J. Calarco, coal analyst with the Chase Manhattan Bank, is the rail deregulation bill passed by Congress last year.

That bill permits railroads and their customers -- in this case, electric utilities -- to arrange long-term contracts in which the railroads guarantee to deliver an agreed amount of coal at a specified delivery price.This price is subject to adjustments, but the contract also contains performance standards the railroads must meet in order to receive full payment. Such contracts were not permitted before deregulation, but they could open up agreements between mining companies, railroads, utilities, exporters, and industries that use coal.

But these contracts, which could assure more dependable supplies and deliveries, could also open up a host of legal and financial issues. "Bankers, lawyers, and others have been slow to come to grips with the enormous and complex legal and financial issues that are involved," said Eliot R. Cutler, a Washington attorney who during the Carter administration was associate director for natural resources, energy, and science in the Office of Management and Budget.

Mr. Cutler foresees a time when many massive investments will have to be made in new mining, transportation, and uses of coal, and that "each and every player , each and every investor is going to demand assurances of performance from the others."

Individuals, companies, and governments, be continues, will not be willing "to invest substantial resources in these projects" unless there are some legal guarantees of financial protections should one part of the system break down. A coal-car shortage or a coal strike, for instance, could cause serious problems for a utility if it had been unable to finance the storage costs of a large backlog of coal.

Problems of complex contracts, however, are issues for the future. For now, the industry's problems with the United Mine Workers remains an important cause for uncertainty. Even the analysts disagree about what effect this spring's coal strike will have.

"Every day that goes by without a resumption of production, I become less and less optimistic," Mr. Cutler said after the walkout was almost two weeks old. "It could have extraordinarily serious consequences for this country's reputation as a reliable supplier of coal. we have the opportunity here to show the world that the US will be a reliable supplier. If we fail, importers will fall back . . . on the other sources."

"People were looking to the US as an alternative to Australia," Miss Martin said. That country, which suffered a long strike last year, is a major competitor with the US, particularly in Pacific Rim countries, such as Japan and Taiwan. Without a strike, the US had a chance to permanently win some of that business. If the US strike lasted only four to eight weeks, she continued, "it should not have a serious impact."

One result of the strikes in the US and Australia, as well as the labor problems in Poland, which have dramatically cut that nation's coal exports, may be that countries importing coal will be forced to keep large supplies of coal on hand continually, to protect themselves against such interruptions.