More than 400 people are expected to lose their jobs due to the closure of the Hatfield Colliery in South Yorkshire.
It is closing 14 months earlier than scheduled.
According to trade union Prospect, 420 “high-skilled” jobs and further jobs in the supply chain will be lost.
Prospect negotiator Mike Macdonald said: “Hatfield has been unable to sell its coal because of the government’s refusal to sponsor coal contracts with generators and the doubling of the UK’s carbon tax. Despite the continued demand for coal in electricity generation, Hatfield will start to close this week and the UK will have to rely on coal imports.”
The Department for Business, Innovation and Skills said it has been “working closely” with the company through this difficult time.
Business Minister Anna Soubry added: “That has included providing up to £20 million to support the company’s managed closure plan. Hatfield’s directors have however taken the decision to close the mine because it could not sell enough coal at the price needed to keep it operational.
“Our priority now is to support the workforce. The Jobcentre Plus rapid response service will be available to help people into new employment or training.”
Coal mines at Kellingley in North Yorkshire and Thoresby in Nottinghamshire will close later this year.