Bernstein Research issued a report Monday expecting U.S. coal-fired power generation to increase this year because of higher natural gas prices, but that the trend will not continue as utilities find it less expensive to rely more on natural gas, according to Platts.
Bernstein’s report states that rising gas prices will reduce utility gas use by about 2.2 Bcf/d in 2013, according to Platts, but new federal regulations give gas the advantage in the future, making it cheaper for many utilities to retire older, smaller coal-fired units than install the required emissions controls.
Analysts from Bernstein stated the federal Mercury and Air Toxic Standards going into effect in 2015 will cause around 54 GW of coal-fired capacity to be retired, which will reduce coal-fired generation by 156 million MWh and cut utility coal burn by around 90 million tons relative to 2011 levels, Platts reported.
The near-future increase in gas-fired generation will increase utility gas burn by around 2.0 Bcf/d relative to 2011 levels, Platts cited the report as stating.
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