15 April 2010– The Energy Information Administration’s (EIA) Short Term Energy Outlook (STEO) for April predicts the use of natural gas and coal will continue to increase in 2010.
EIA expects natural gas consumption to increase almost 2 percent in 2010 and fall by less than 1 percent in 2011. The STEO also expects the production of natural gas to increase this year before declining in 2011.
The price of natural gas at to the Henry Hub averaged $4.29 per MMBtu in March. Spot price forecast averages are $4.44/ MMBtu in 2010 and $5.33/MMBtu in 2011.
The use of coal is expected to increase 4 percent in the electric power sector in 2010 and an additional 1.1 percent in 2011. Coal use in the electric power sector has been more than 1 billion short tons from 2003 through 2008.
Coal production fell 8 percent in 2009 in response to lower U.S. coal use, fewer exports and higher inventories. Production is expected to decline another 4 percent in 2010 before seeing a forecasted 5 percent rise in 2011. Meanwhile, the price of coal in the electric power sector is expected to fall to $2.14 per MMBtu in 2010.
In 2009, electricity generation from coal declined almost 11 percent. Generation from natural gas increased by 5 percent with the help of lower natural gas prices. EIA projects total natural gas generation in the electric power sector to increase in 2010. Because of a low snow pack in the Northwest, hydropower generation is also expected to be low in 2010, dropping under 8 percent for the entire United States.
Growth in the U.S. economy combined with an increased use of coal in the electric power sector is expected to contribute to an increase in carbon dioxide emissions of 2.1 percent this year and 1 percent in 2011. Even with the projected increases in 2011, emissions levels are still lower than annual levels between 1999 and 2008.
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