King Coal is losing power, down to 36% of US electricity production

                                                                                                                                                   A strange thing happened a couple of weeks ago in the West Virginia Democratic primary. A fringe candidate, a Texas inmate called Keith Judd, won four votes of every 10 votes cast by Democrats in that state. Why? Because a lot of West Virginians believe that their state’s core industry, coal mining, is under assault by the US government’s current energy policy. That point was made even clearer on the night when Judd outpolled Obama in 10 coal-producing counties.

Coal once dominated power production, as it did all process and manufacturing indutries. But across the country, power generation from coal is falling quickly. According to a recent report from the Energy Information Administration (EIA), coal made up 36% of power generation in the first quarter of 2012 – down from nearly 45% in the first quarter of 2011. Faced with the rapid decline of domestic coal consumption, Big Coal companies such as CONSOL Energy, Peabody Energy, and Arch Coal face an uncertain future.

While the use of cleaner-burning natural gas in the electric power sector is growing by more than 20% a year, the EIA is predicting that coal production at mines will fall by more than 10% in 2012. If being undercut by natural gas (and competitively-priced renewable sources such a wind and solar) were not enough, the US coal industry also has to deal with the reality that the power industry has an aging fleet of coal-fired power plants that require very expensive retrofitting to comply with clean air regulations, as well as a growing anti-coal lobby.

In addition, new EPA regulations will force new power plants to emit no more than 1,000 lbs of CO2 per megawatt-hour. These measures will make it hard if not impossible for the development of new coal plants, which produce as much as 1,800 lbs. By contrast, natural gas plants emit a little less than 1,000 lbs.

In fact, the power industry is steadily abandoning coal plants. According to the Sierra Club, since 2010, power plant operators have retired 106 coal plants, or 13% of the total US fleet.

King Coal is in decline. And the voters in Coal Country are none too happy about it.

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Photo by Rennett Stowe, used under a Creative Commons license.
Stuart Hampton

British editorial veteran Stuart Hampton has been covering oil and gas companies for Hoover's since the Neogene-Quaternary period. Well, actually, since the early 1990s. For the best overview of the oil industry and its history he recommends Daniel Yergin's "The Prize." You can also follow Stuart on Twitter.

Read more articles by Stuart Hampton.

Comments

  1. It is typically more enixespve for you to designate “green” power. It is a method to subsidize the building of more wind power, but in reality wind power is not any more “green” than nuclear power. The intermittent nature of wind power makes it necessary to have some sort of “backup” power, usually gas, wind uses much more concrete and steel than nuclear power for the same amount of megawatts. Wind power actually has a larger “footprint” than nuclear power, it takes more land to produce the same amount of power. We need to explore all the methods of producing power while minimizing the effect on the environment, this is one way of donating to that cause and voting with your $$.

  2. Stuart Hampton says:

    @Ralf,

    You make a good argument.

    However, the dangers of radiation and Japan’s Fukushima plant disaster have led Japan, Germany, and Switzerland to decide to abandon nuclear power. Even France is cutting back. Wind power has its drawbacks for sure, but it does not scare the voting public like nuclear power does.

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