Gas surges ahead of coal in US power generation

Karl Mathiesen, THE GUARDIAN
For the first time ever, gas has usurped coal as the biggest producer of electricity in the US. Analysts say Obama administration’s proposed climate change rules are likely to establish gas as the predominant source of electricity as early as 2020.
Figures released by the US government’s Energy Information Administration (EIA) show that in April, natural gas produced 31.5 per cent of the country’s electricity and coal 30.2 per cent.
The interregnum will not last, with coal expected to average around 35.6 per cent of generation across 2015. But a decade ago, such an inversion was unthinkable. Americans got half their electricity from coal and just a fifth from natural gas. Now the two are neck and neck.
In April a glut of fracked gas from new shale regions drove the price of gas down to just $2.50/million Btu (British thermal unit, a widely-used measure of energy), a 35 per cent drop since February. This oversupply, combined with a routine seasonal shut down of coal plants, caused gas production to creep above coal for the first time.
“Power generators often use the spring months to take their plants offline for maintenance, especially coal plants. This maintenance period happened to coincide with a period of very low natural gas [prices],” said Tyler Hodge who works on the EIA’s Short-Term Energy Outlook.
Hodge said gas prices were expected to rise again in the coming months, and coal would reassert itself at the top of the production table when plants fire up again for the winter.
In 2012, gas prices fell even lower and production almost overtook coal, but coal returned to dominance. “So this [gas surge] is by no means irreversible,” said Michael Obeiter, a senior associate in the World Resources Institute’s climate programme. But he said the short term fluctuations in gas price were compounding an overall drift away from coal and the trend favoured “natural gas becoming the dominant source for electricity generation in the US in the coming years.”
Read more at: Gas surges ahead of coal in US power generation – 15 Jul 2015 – News from BusinessGreen