By Taylor Kuykendall

Early in 2015, members of the coal industry gathered at an industry conference and lamented an "annus horribilis." Looking back now, the horrible year of 2014 may have been a tame prequel to the slasher that was 2015.

While a few coal companies managed to grow and take advantage of cheap asset sales and a market changing shape, most of the headlines about the industry bore little good news. Here is SNL Energy's look at the 10 stories that impacted the year in coal and what they could mean for the industry going into 2016.

1. Specter of Clean Power Plan reveals its form, MATS in effect

It was inevitable that when President Barack Obama released his plan for controlling greenhouse gas emissions, it would not look good for coal. In August, the industry found out exactly how bad things would be, with dramatic drops for coal projected by even the most conservative estimates.

The finalized version of the rule strengthened its carbon dioxide emissions reduction target from a 30% of 2005 levels by 2030 to 32% in the same period.

Adding to the sting, the industry was still reeling from wounds inflicted by the Mercury and Air Toxics Standards that had gone into effect in the spring. While the industry eventually claimed a small victory from the U.S. Supreme Court — though the court did leave the rule in place while the U.S. EPA reconsiders the cost of compliance of the rule — it would ultimately prove too late for utilities that had already made their compliance decisions by retiring coal units.

As the industry marches into 2016, it hopes it will not fall into the same trap. Multiple attacks mounted on the Clean Power Plan have been targeted by U.S. states, trade groups and companies like Murray Energy Corp., all aiming to take down the rule before states and utilities again take big steps away from coal.

2. Natural gas tries out King Coal's throne

When the U.S. Energy Information Administration announced natural gas passed coal for U.S. electricity generation for the first time in April, it was a big deal, but not expected. What many did not expect is that coal would get beat by natural gas five of the first 10 months of 2015.

The EIA will not release data concluding whether gas won the year until later in 2016, but the speed at which gas is replacing coal has occurred faster than many had expected on the advantage of persistent record-low prices. Meanwhile, renewable energy sources such as wind and solar continue to pose a threat to what was long the nation's dominant fuel source for electrical power supply.

If natural gas prices stay low and alternative energy sources become cheaper, coal could see even more of its market share evaporate in 2016.

3. Bets on met coal unwind players that went all in

At the same industry conference where the industry lamented its terrible 2014, Jack Porco, president and chief commercial officer of Xcoal Energy & Resources warned many "large mining companies bet the farm on coking coal" and a price improvement would be needed for "these companies to survive."

Prices did not improve. The hulking debt companies like Alpha Natural Resources Inc., Walter Energy Inc. and Patriot Coal Corp. took on at what would prove to be the near-top of the metallurgical coal market would drag them all into bankruptcy in 2015.

While a few of the coal giants such as Peabody Energy Corp. have more stable balance sheets, the industry's large bankruptcies may not be over yet. On Nov. 9, Arch Coal Inc. reported it was in active talks with creditors over restructuring its balance sheet.

4. Paris sets the stage to seal coal's global role as export hope dims

While coal's role in the U.S. faded, it increasingly had been looking abroad for relief. Europe's decarbonization and Asia's recent economic slowdown, as well as numerous indications China would slash at its own coal usage, has dimmed a lot of the hope coal once had in exports.

One major eastern U.S. coal producer recently told SNL Energy that Central Appalachia coal exports are "likely to die" in 2016. While demand has fallen for steelmaking coal and steam coal, U.S. producers also struggle to compete with other global producers in a market plagued by multiyear pricing lows.

At the same time, export capacity is constrained, particularly on the West Coast. In 2016, environmentalists seeking to eliminate coal could put even more pressure on projects designed to relieve that constraint. Now, with an international climate change agreement struck at the 21st Conference of the Parties to the U.N. Framework Convention on Climate Change in November, coal may find more and more of its customer base turning to alternative energy sources.

5. Environmentalists declare victory in war on coal

When the industry's supporters first alleged a "war on coal," many were quick to point to coal's non-regulatory challenges, such as low natural gas prices as the real source of its woes. In 2015, however, billionaire activist Michael Bloomberg and Sierra Club Executive Director Michael Brune not only acknowledged a " war on coal," but also claimed they were winning it.

"With the help of Bloomberg Philanthropies and thousands of activists across the country, a fair and just transition to an economy powered by 100% clean energy is in our sights, and dirty coal is becoming a thing of the past," said Brune.

The guerilla strategy against the industry includes an extensive policy, legal and public relations battle that more often than not, groups like the Sierra Club have won. In 2016, coal companies are likely to see more challenges to coal at every level — from mining and burning coal down to its permitting and transportation processes.

6. Coal executive convicted but escapes most punitive charges

While most coal executives had plenty to keep them up at night in 2015, few probably had as much to worry about as former Massey Energy CEO Don Blankenship. The well-known Appalachian coal boss stood trial in a federal court in West Virginia facing felony charges and up to three decades in prison largely based on findings from the investigation of the 2010 explosion of the Upper Big Branch coal mine.

Jurors ultimately found Blankenship guilty of just one misdemeanor charge related to violating mine safety laws. With the jury rejecting securities fraud charges, Blankenship now faces just up to one-year imprisonment.

Prosecutors who brought the case against Blankenship said the conviction should send a message to coal operators everywhere about prioritizing profits over safety. Skeptics, however, say Blankenship was uniquely involved in day-to-day operations, and mining law will need to be reformed to effect real change.

Either way, it could be difficult in 2016 to improve on 2015 with the lowest number of coal fatalities on record, according to federal safety records.

7. Financial community backs away

Whether it will unravel the industry or stand as pure symbolism, a growing movement to divest from coal and stymie financing of major coal projects gained a lot of momentum in 2015. Increasingly, banks are backing away from large-scale mountaintop removal coal projects and investors hesitate to put their money into even some of the stronger coal companies.

"How the market chooses to value that is really not something that we can control," Westmoreland Coal Co. CEO Keith Alessi said on a recent earnings call. "As you are well aware, we have seen dramatic reductions in the value of equity without any material change in really the prospects or performance of the business."

One of the main pushers of coal divestment, Bill McKibben, co-founder of 350.org, recently said that it may have begun with symbolism, but divestment is now delivering a real punch to the battered industry.

"After seeing the progress of the last year," McKibben added, "I don't know who is going to want to pour new money into coal at this point."

8. Peak coal predicted as China slows consumption

In a September research note, Goldman Sachs Group Inc. made the case for the potential that the world hit "peak coal" in 2013 and will only decline in the future.

The industry's growth has essentially ground to a halt, the note explains. Because demand has flattened, prices have stifled and hardly anyone in the industry is looking at new investment.

"In addition to regulatory headwinds that undermine in some markets the economics of coal-fired power generation in favor of cleaner fuels, the demand outlook is also challenged by additional risks," Goldman said. "… We believe the seaborne market has gone ex-growth and coal prices will trade near the level of marginal production costs for the foreseeable future."

9. New players emerge on coal scene, old players brace for future

Some companies have managed to find opportunity amidst all the suffering in the sector.

Blackhawk Mining LLC has continued to scoop up assets from its bankrupt peers, expanding and diversifying its coal product offering. The company was able to do so largely because it was not loaded with debt from ill-timed acquisitions like some of its peers.

Royal Energy Resources Inc. is also emerging on the scene and its executives believe now is the time to move on asset buys in the coal sector.

"It's been the wrong time for a long time to invest in coal, but now we've got this great opportunity at the bottom of the market," said Ronald Phillips, president and interim secretary, in an August interview. " … We're not saddled with all the legacy stuff that others are. … We've got a very close knit group of investors who like buying what they consider a real value at bottom."

Meanwhile, companies like CONSOL Energy Inc. are looking to other business for relief. The company has pruned its coal assets to select properties and is increasingly focusing on natural gas production.

10. Carbon capture remains out of grasp as coal seeks future role

The year was also not encouraging for those banking on carbon capture technologies to secure coal a place in an increasingly less carbon-intensive U.S. grid.

The technology exists, but so far, it has proven costly and somewhat unreliable. Southern Co.'s Kemper project in Mississippi has run into numerous cost overruns. It was recently discovered Canada's SaskPower project was only able to run at 40% capacity in its early run. FutureGen Alliance's FutureGen 2.0 project was taken offline when the government pulled funds for the project.

"That technology is in the middle of a valley of gas," Kipp Coddington, director of the University of Wyoming's Carbon Management Institute told SNL Energy. "It just needs a few more million dollars to get it on the power plant to confirm its prior small-scale successes, but that coal plant's facing a carbon reduction mandate and it's not going to be interested in testing a technology."

Now, some in the coal industry are calling for funding and tax breaks on par with that received by the renewable energy industry.

"There's no doubt we can do it, but there's no doubt it's more expensive," said Fred Palmer, a retired Peabody executive and coal policy committee chair for the National Coal Council. "The governments have to socialize it. They have to incentivize people to do it instead of punishing people."