Coal Comeback?

Right now, coal is the most-used fuel for power generation in the United States.

Natural gas is catching up more quickly than ever, but coal still outpaces any other source. And it will for the near future.

But the trend of coal usage is less certain. The Energy Information Administration projects this trend in the U.S.:

The U.S. is a major coal producer, but not all the coal mined here stays here. In fact, coal exports have been on the rise as domestic consumption falls.

It's true that coal stocks have slumped since the election results came in. Mitt Romney was “King Coal” during his campaign, talking up the widespread use of “clean coal” he would encourage during his presidency.

Barack Obama, meanwhile, campaigned as an advocate for moving away from major coal usage in favor of natural gas and ultimately renewables. His election pushed coal stocks down.

But that doesn't mean they're going to stay down. As coal demand in the United States drops, it's expected to continue to increase elsewhere.

Last year for example, coal used for electricity fell 21 percent in the United States. But it jumped 65 percent in India, 81 percent in South Korea, and 119 percent in Japan.

And the Energy Department suggested that while world coal demand grows 40 percent in the next 18 years, exports from the U.S. will grow 20 percent.

That's great news for domestic miners that are discouraged by the declining demand here at home.

But some investors are bullish in the shorter term as well. 24/7 Wall Street suggests the Fed's stimulus could help push coal stocks in the right direction. The point of the easing is to increase employment and development, and the coal sector is not excluded from that.

And the fear of coal plant closures may already be a thing of the past. A number of plant closures have already occurred, and 24/7 Wall Street suggests that more will not be necessary for quite some time.

Barrons' Rhiannon Hoyle suggests that CONSOL Energy Inc. (NYSE: CNX) and Peabody Energy Corp. (NYSE: BTU) are good stocks for the bullish coal investor.

The Market Vectors Coal ETF (NYSE: KOL) could also provide a good avenue for coal investing. Although it's lost quite a bit over this year, it's up more than 8 percent in the past month.