U.S. coal consumption in 2018 is expected to be the lowest in 39 years, according to the country's Energy Information Administration (EIA).
The U.S.' coal consumption in 2018 is estimated to fall to 691 million short tons (MMst), a 4 percent decline from 2017, to reach its lowest level since 1979, the EIA said in a statement on Friday.
U.S. coal consumption had peaked in 2007 but has been falling since then. According to the EIA, coal consumption in U.S. will be 437 MMst this year -- 44 percent lower than in 2007.
One of the reasons behind this fall is the decline of coal use in the U.S.' electric power sector. The American electric power sector is the nation’s largest consumer of coal, accounting for 93 percent of total coal consumption in the country between 2007 and 2018.
'The decline in coal consumption since 2007 is the result of both the retirements of coal-fired power plants and the decreases in the capacity factors, or utilization, of coal plants as increased competition from natural gas and renewable sources have reduced coal’s market share,' the statement said.
Coal-fired capacity in the U.S. totaled 313 gigawatts (GW) across 1,470 generators in 2007. However, by the end of 2017, 529 of those generators with a total capacity of 55 GW had retired, it said.
While 11 GW of coal-fired generating capacity has retired through September this year, another 3 GW are expected to retire in the final three months of 2018, and another 4 GW of capacity are set to retire by the end of 2019, according to the EIA.
'If these plants retire as planned, 2018 will be the second-highest year for coal retirements,' it added.
The administration said the decline in coal-fired capacity is expected to further reduce coal consumption, noting that it forecasts coal consumption in the U.S. power sector to fall 4 percent in 2018 and 8 percent in 2019.
Another reason behind coal retirements is the price of coal compared to natural gas. The price of natural gas has stayed relatively low since domestic gas production in the U.S. began to grow in 2007.
'This period of sustained, low natural gas prices has kept the cost of generating electricity with natural gas competitive with generation from coal. Other factors such as the age of generators, changes in regional electricity demand, and increased competition from renewables have led to decreasing coal capacity,' the EIA said.
Environmental concerns were another factor that led to coal retirements. Due to stricter emissions standards in 2015, coal retirements were at the highest that year in the U.S.
'Instead of investing in emissions control technologies, many smaller power plants that operated at lower capacity factors were retired before the new standards were implemented. Some plants applied for and received one-year extensions, which contributed to retirements in 2016,' the statement said.
By Ovunc Kutlu