Coal's Share of The US Generation Market Will Rise to 39% in 2013

Coal's share of the US generation market will rise to 39% in 2013 from last year's 37.6% and reach 39.6% in 2014, the Energy Information Administration said Tuesday in its January Short-Term Energy Outlook. 

EIA said coal's rising share was a product of a projected increase in natural gas prices. 

The agency forecast that the Henry Hub natural gas spot price, which averaged $2.75/MMBtu in 2012, is expected to average $3.74/MMBtu this year and $3.90/MMBtu in 2014. 

The agency said 2012 ended with the lowest level of electric power sector coal consumption in 20 years. The industry burned an estimated 829 million st last year, down from 932 million st in 2011. 

While the EIA expects domestic consumption to stabilize in 2013 and 2014, it said production will 3.6% in 2013 before rising 3% in 2014 on higher export demand. 

The agency said average delivered coal prices should rise 4 cents to $2.44/MMBtu this year and average $2.50/MMBtu in 2014.