The structural decline trend in the U.S. coal industry seen in 2017 will persist, a study published Thursday by the Institute for Energy Economics and Financial Analysis (IEEFA) reported.
The report entitled, U.S. Coal: More Market Erosion Is on the Way, detailed how competition from cheap natural gas, the growing uptake of solar and wind powered generation and little growth in electricity demand have combined to shrink the market for coal.
"In electricity generation—the key market for coal—the industry is increasingly uncompetitive and is losing market share," David Schlissel, lead author on the report and IEEFA's director of resource planning analysis, was quoted as saying.
"Further declines in coal's energy generation market share can be expected through 2018 and beyond," he continued.
The market share of wind and solar has increased four-fold since 2009 and wind's share of total electricity generation exceeded 30 percent in 2017 in the U.S.
Coal consumption in 2017 stayed at record lows in the U.S. with retirements of coal-fired plants proceeding apace, while wind generation, in particular, contributed to record renewable-energy gains and low coal prices continued to hobble the industry, the report said.
The total amount of coal-fired capacity likely to be retired this year over 2017 will double, to 15,000 megawatts from about 7,300 megawatts, the report predicted.
"In a fresh wrinkle in a long-established trend, many retirements will be of plants with more than 1,000 MW of capacity," it added.
By Ebru Sengul