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Wednesday, June 06, 2012

Coal's share of electric generation keeps dropping

You can blame or credit the warmest March on record in a lot of the country, and historically low natural gas prices driven down by supply from hydraulic fracturing, for a whale of a drop in coal's share of U.S. electric generation in March.
Coal's share of net generation dropped to 34 percent, the lowest since at least January 1973, when the U.S. Energy Information Administration started keeping monthly statistics. Its report  this week notes that "despite seasonally low loads, natural gas-fired generation grew markedly and accounted for 30 percent of overall net generation by March 2012. Total electricity demand fell this winter as warmer weather reduced home heating requirements.

Coal generation decreased 29 billion kilowatt hours from March 2011 to March 2012, while natural gas generation increased 27 billion kwh during the same time period, accounting for 30 percent of generation. Gas prices were near 10-year lows this winter, leading coal-burning utilities in states such as Ohio and Pennsylvania to increase their use of natural gas-fired plants. "Newer gas units operate at higher efficiency than older, fossil-fired units, which increases the competitiveness of natural gas relative to coal," EIA reported.

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