Abstract: Currently, the problem of over-capacity in China's coal enterprises is still serious, and accurate measurement and judgment of overcapacity in coal enterprises is the premise of eliminating overcapacity scientifically. This paper puts the firm's productivity heterogeneity into the traditional estimation framework of firm-specific capacity utilization(CU),and based on the China's coal enterprises data measures CU during the period 1998-2013. Also, we analyze the evolution characteristics of CU in coal enterprises:CU in China's coal enterprises decreased before 2000, rising rapidly during 2001-2008, and began decreasing thereafter. Moreover, there are substantial differences in CU across regions and ownerships, and CU is strongly pro-cyclical. Further, we investigate the causes of over-capacity in China's coal enterprises, and the results indicate that:the over-investment, government intervention and credit distortion are important causes of the over-capacity. Therefore, to resolve the excess capacity of coal enterprises, it is necessary to improve the exit and transformation mechanism of enterprises, handle the relationship between the government and the market and give full play to the role of market resource allocation. In addition, the development and utilization of clean and efficient coal should be promoted to form a safe, efficient and clean coal supply security system.