It is reported that British coal production looks set to grow in 2008 for the first time since 2001, thanks to higher coal prices and power generators' new found appreciation of domestic coal supplies.

Coal production in the UK has been falling since the 1950s, when almost 1,000 mines produced more than 200 million tonnes a year. By 2007, output had dwindled to 16.3 million tonnes from 52 mines.

But several expansion projects mean production is expected to pick up in the second half and is likely to beat last year. By the end of the decade, investment by coal companies is due to deliver a significant rise in the UK's coal output.

The renaissance of UK coal is the result of a steep rise in world prices, caused by soaring oil and gas prices and a growing demand for electricity in the developing world. It is once again profitable to mine many of the UK's deposits and power companies are increasingly choosing local coal because of concern about shortages in the international market.

Several power companies have indicated they will import less foreign coal and rely more on local supplies. In July 2008, Scottish Power signed a deal with Scottish Coal to buy 2 million tonnes a year for the next 5 years, which the mining group said would lead to the opening of new open-cast pits and more than 100 new jobs.

Other groups expanding production include Powerfuel, which has reopened the Hatfield colliery near Doncaster and Energybuild.