Rising natural gas prices to increase use of coal, renewables in 2014

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U.S. coal use is expected to increase 4.1 percent in 2014 as natural gas prices continue to climb, according to the U.S. Energy Information Administration (EIA)’s Short Term Energy Outlook.

EIA estimated total coal consumption for 2013 to be 920 million metric short tons (MMst), a 3.5 percent increase over 2012. Coal consumption is estimated to increase to 958 MMst in 2014, but decline by 2.1 percent in 2015 due to the implementation of the Mercury and Air Toxics Standards (MATS).

Total natural gas consumption will average 70.2 Bcf/d in 2014, the report said. The projected year-over-year increase in natural gas prices contributes to declines in natural gas electricity generation from 24.9 Bcf/d in 2012 to 22.3 Bcf/d in 2013 and 22 Bcf/d in 2014. Total natural gas consumption increases by less than 1 Bcf/d in 2015 with a rise of use in the industrial and electric power sectors.

EIA also estimates renewables used for electricity generation will grow by less than 1 percent this year. Hydropower is expected to decrease by 2 percent, and non-hydropower renewables will increase by 2.2 percent. In 2015, renewables use for electricity generation is projected to increase by a rate of 5.8 percent from 2014, as a 5 percent increase in hydropower combines with a 6.2 percent increase in non-hydropower renewables. EIA says wind capacity will increase by less than 9 percent in 2014 to 66 GW, and another 15 percent to total more than 75 GW by the end of 2015. Utility-scale solar increased by 96 percent in 2013, and is expected to increase by 47 percent between year-end 2013 and year-end 2015.

Carbon dioxide emissions from fossil fuels increased by 1.9 percent in 2013 from the previous year, EIA said. Emissions are projected to increase 1.2 percent in 2014, followed possibly by a small decline in 2015. The increase in emissions is due to a rise in coal generation between 2013 and 2014 due to higher natural gas prices.

To read the full outlook, click here.

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