U.S. coal use for electricity falls to a 33-year low

Coal consumption for electric power in the U.S. has fallen to its lowest since 1984, according to the U.S. Energy Information Administration. Natural gas is a cleaner, more flexible fuel, and has become cheaper; economists say that makes coal, compared to gas, the most expensive in 40 years.

The EIA Today in Energy report released Friday showed that in 2016, coal consumption has dropped 35 percent from its peak in 2008, Myra Saefong writes for MarketWatch. Saefong notes that 93 percent of all coal consumed in the U.S. is for electric power. "The report was about the methods used to transport coal, but the information on how much coal utilities burned underscored the challenges facing the industry," notes Bill Estep of the Lexington Herald-Leader.

U.S. Energy Information Administration chart; click on chart for larger version.

Under the Obama administration, coal took heat from the Environmental Protection Agency and others, and burning natural gas produces about half the greenhouse-gas emissions that burning coal does. “Coal is almost always less expensive . . . and natural-gas plants respond faster to changes in power demand than coal plants,” James Williams, energy economist at WTRG Economics, told Saefong. “The primary reason that coal use was down was the price of natural gas.”

Saefong notes, "Natural-gas prices have also fallen more sharply than coal so far this year. On Thursday, the price for July natural gas settled at $3.008 per million British thermal units on the New York Mercantile Exchange. According to S&P Global Platts, spot prices for the Central Appalachia coal markets traded at $58.20 a ton at the end of 2016. It traded at $54.30 Thursday, so it is down about 6.7 percent year to date."