If you care about the environment, you can emulate Stanford University's move to remove coal-producing companies from its endowment portfolio by purging fossil fuel companies from your own investments, although it will take a customized strategy.

Despite its role in climate change and air pollution, coal may remain in favor because it's still relatively cheap to mine and burn compared to alternative forms of energy in most developing countries.

In recent years, though, coal has hardly been the darling of the volatile U.S. energy sector. Faced with lower natural gas prices, a boom in North American oil and methane production and growing competition from wind and solar power, companies that mine the black mineral have been suffering in recent years.

The Market Vectors Coal ETF, which tracks an index of the world's largest coal producers, is down an average 24 percent for the three years through May 16 and off 7 percent for the past 12 months. The fund holds companies like China Shenhua Energy Co. Ltd., Aurizon Holdings Ltd. and Peabody Energy Corp. and charges 0.59 percent in annual expenses. It doesn't have much competition since it's the only index ETF to exclusively own coal producers.

If you dislike the idea of holding coal-burning utilities or producers in your portfolio - or fossil fuel companies in general - one option is to create a customized fund that eschews these kinds of companies. For holders of individual stocks, you could either build a portfolio around "clean-energy" stocks in wind, solar and alternative technologies, or find a similar socially responsible portfolio or "clean technology" mutual fund.

The PowerShares Wilderhill Clean Energy ETF, for example, holds alternative energy companies like Calpine Corp , Maxwell Technologies, Inc and Gentherm, Inc . Companies like these specialize in natural gas, geothermal, solar and energy-conservation technologies. The fund is up nearly 17 percent over the past 12 months through May 16 and charges 0.70 percent in annual management expenses.

Yet cobbling together such a targeted portfolio on your own is difficult since most large index funds own fossil fuel companies. The giant S&P 500 SPDR ETF, for example, holds ExxonMobil Corp, Chevron Corp. and Peabody Energy.

NEAR-TERM DEMAND BULLISH FOR COAL

Until the economics change, coal combustion will dominate energy production in most places where coal is plentiful, loosely regulated or easily imported.

According to the U.S. Energy Information Administration (EIA), U.S. coal consumption is forecast to grow 5 percent this year, after dipping the previous two years. Production will grow 3 percent in 2015 as "electricity demand grows and natural gas prices remain well above their 2013 level."

Over the next few years, coal companies are poised to shake off the recent slump and recover. Production is forecast to grow 4.4 percent this year and a tight U.S. supply has also pushed up prices of the mineral.

Generally, global economic expansion favors further coal price increases. The mineral is an essential ingredient of steelmaking, which is important in developing countries like China, India, Brazil and most of Africa and the Far East. Some 70 percent of steel production involves coal.

Most of the demand for coal is coming from China. Although the country is the largest producer of coal for steelmaking, it needs to import coal to produce electricity.

But tougher environmental regulations, particularly in the United States, are expected to curtail coal consumption. The EIA predicts that coal consumption will fall 5 percent next year as more utilities shut down coal-burning power plants.

The U.S. Environmental Protection Agency will put even more pressure on the industry when it creates new standards for mercury, the toxic element released by coal combustion. And with the Supreme Court's recent ruling upholding the Clean Air Interstate Rule, which clamps down on interstate coal-related air pollution, it will be even more difficult for coal-fired plants to keep operating without expensive pollution controls.

As an individual investor, your actions won't change the global energy picture. But you can always become an activist and demand that major institutions from government to universities not only use clean energy, but develop eco-technologies to displace coal and other fossil fuels as a source of energy. That may be the more meaningful gesture that goes far beyond what you can do with your portfolio.