Coal demand saw a bit of a revival in the U.S. power generator sector, while its supply side reeled in 2020.
New data from the federal Energy Information Administration shows that coal delivery to the electric power sector fell to its lowest level since the EIA first published those statistics 14 years ago. And U.S. coal shipments in 2020 decreased 22 percent from the previous year.
Coal shipments to U.S. electric power sector totaled 428 million short tons last year. Key factors to that decline are both long-term—coal-fired plant retirements—and short term with the COVID 19 economic downturn squeezing down demand for electricity.
Ironically, bad weather may have been helped coal power’s margin in the overall U.S. electricity generation mix this winter. EIA data previously showed the coal-fired plants provided 26 percent of utility-scale net generation for January and February, compared with about 20 percent for 2020.
Higher gas prices and constrained gas supply played some role in coal’s temporarily rise with freezing winter storms which caused significant power outages in Texas and elsewhere. The cold snap impacted delivery systems such as gas pipelines, while coal-fired plants typically have weeks of supply on site.
Nearly all U.S. coal comes from four regions: the Powder River Basin in Wyoming and Montana, the Illinois Basin in that state, Indiana and Kentucky, and Central Appalachia (Ohio, Pennsylvania and West Virginia).
Worldwide, many developing countries are intent on building coal-fired generation capacity to meet growing electricity needs. Various estimates say that as more than $1 trillion in financing is committed to coal-fired projects globally.
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