Wednesday, December 19, 2012

Coal poised to beat oil as top world energy source, but U.S. demand and production will drop, IEA says

Demand for coal will increase in every world region except the U.S. through 2017, according to the Paris-based International Energy Agency. The trend is attributed to cheap natural gas providing stiff competition to coal in the U.S. The "Medium-Term Coal Market Report" says coal will come close to surpassing oil as the world's top energy source within the next five years, with developing countries burning about 1.2 billion more metric tons of coal per year by 2017.

The report says coal demand will drop in the U.S. by 97 million metric tons of coal equivalent by 2017, and that production will be down 20 percent, to 771 MTCE from the current 967. Predictions about coal's decline in the U.S. "conform with numerous other forecasts of coal use and production," Manuel Quinones of Energy & Environment News reports. The report says cheap gas, retirement of coal-fired power plants and environmental regulation are the leading factors in coal's U.S. decline. (Read more)

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