While President Trump on Tuesday promised to "put our miners back to work" and Vice President Mike Pence declared "the war on coal is over," market prices that favor natural gas won't help revitalize coal, Naureen Malik and Tim Loh report for Bloomberg News. For example, "at least six gas-fired plants are planned in the Ohio River valley over the next four years. That’s enough to supply more than 4 million homes and topple coal as the state’s main source of electricity. That’s what makes it so hard for Trump to bring back mining jobs in states like Ohio where the coal vote helped put him in the White House."
In 2016 "coal’s share of power generation in the state fell to about 58 percent, from 86 percent in 2006," reports Bloomberg. John Bartlett, who helps manage about $2.5 billion of energy and utility stocks at W.H. Reaves & Co. Inc. in Jersey City, "estimates that by 2021, gas-fired stations in Ohio will be able to produce 20.4 gigawatts—almost double their current capacity—while coal will hold steady at 15.4 gigawatts." (Bloomberg graphic: Six new gas-fired plants are planned in Ohio)
"Competition from gas was one reason that AES Corp.’s Dayton Power & Light announced in November it will shut two coal plants in Adams County on the Ohio River. With a combined capacity of 3,000 megawatts, they’ve operated for 40 years and employ hundreds of people," Blomberg reports. About 250 miles east, in the heart of shale country near the Pennsylvania border, in Wellsville, Ohio, a gas-fired plant is being considered, putting two coal-fired plants in the area owned by FirstEnergy Corp. at risk.
Toby Shea, senior credit officer at Moody’s Investors Service Inc., "said that coal closures in places like Ohio will have a 'rippling effect' across markets, pushing already-low electricity prices even lower," reports Bloomberg. "It could turn the world’s single biggest competitive power market—the one operated by PJM Interconnection LLC across 13 states from the mid-Atlantic to the Midwest—into a 'distressed market' where generators struggle to turn a profit."
"Historically, gas prices have been volatile," Bloomberg reports. "The risk is that by the time they swing up again, other producers—nuclear, as well as coal—could have been driven out of business."
In 2016 "coal’s share of power generation in the state fell to about 58 percent, from 86 percent in 2006," reports Bloomberg. John Bartlett, who helps manage about $2.5 billion of energy and utility stocks at W.H. Reaves & Co. Inc. in Jersey City, "estimates that by 2021, gas-fired stations in Ohio will be able to produce 20.4 gigawatts—almost double their current capacity—while coal will hold steady at 15.4 gigawatts." (Bloomberg graphic: Six new gas-fired plants are planned in Ohio)
"Historically, gas prices have been volatile," Bloomberg reports. "The risk is that by the time they swing up again, other producers—nuclear, as well as coal—could have been driven out of business."
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