Friday, January 12, 2018

Official forecast: Coal will keep losing out to natural gas; pro-drilling policies don't help coal

"Just a day after federal regulators nixed a major Trump administration proposal to shore up the struggling coal industry, the nation’s top energy forecaster predicted continuing, slow declines in U.S. coal production and in the burning of coal for electricity in 2018 and 2019, thanks to cheap natural gas and coal plant retirements," Chris Mooney reports for The Washington Post.

The Energy Information Administration's monthly report projected that coal production will decline from 773 million short tons in 2017 to 759 million in 2018 and 741 million in 2019. Burning coal for electricity, its main use in the U.S., will also decline steadily. By 2019, the report predicts that gas will generate 34 percent of electricity in the U.S. and coal will produce 28 percent. In 2003, coal accounted for 51 percent and gas 17 percent.

"The report offers the latest evidence that while the Trump administration’s focus on energy production may advantage some fossil fuels — the report also predicts a record U.S. crude oil production of 10.3 million barrels a day in 2018, followed by 10.8 million in 2019 — it’s proving more difficult to change the trajectory for coal," Mooney reports. "That’s because it’s a carbon-intensive fuel that faces not only adverse policies but also market forces, such as the booming production of natural gas thanks to fracking."

Christopher Knittel, a professor of applied economics at the Massachusetts Institute of Technology, told Mooney that cheap natural gas, not Obama-era regulation, is killing coal: "If anything, the policies of the current administration are going to exacerbate that, in the sense that they’re opening up lands for more drilling, which is likely to generate more oil, but can also generate more natural gas — which might be the final nail in the coal coffin, if you will."

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