Moody’s: Coal-fired power will stick around in U.S.

10. New Jersey (13.87 cents per kWh)

Coal-fired electricity generation capacity was roughly 27 percent of total electric supply in 2014, and unless carbon emissions regulations are accelerated will continue to be a leading fuel source of electricity for the U.S. in the foreseeable future, according to Moody’s Investors Service.

“The U.S. is highly dependent on coal for electricity generation. According to Energy Information Administration (EIA) data, coal-fired generating capacity in the US is at nearly 300 GW and this capacity generated about 1,600 trillion watt hours (TWhs) of electricity in 2014,” Moody’s Analyst Jairo Chung says.

Although coal-fired generation has fallen from a 31 percent share of total capacity 10 years ago and Moody’s expects 13 GW of capacity to retire this year, the average fleet capacity factor has risen to 61 percent today from 55 percent five years ago. This is due to numerous smaller coal-fired plants with lower capacity being retired as well as sustained low natural gas prices.

Moreover, power produced from coal-fired generation sources was 44 percent higher than power from gas-fired sources, and 105 percent higher than nuclear generation sources in 2014.

“The overall efficiency of the remaining coal-fired generation fleet will continue to improve,” Chung says. While some states have renewable portfolio standards or goals to increase power generation from renewable sources, some are opting to continue with the ‘least cost’ option for its generation mix rather than quickly replacing existing sources with cleaner, but more expensive generation sources.

In June, the Supreme Court remanded the District of Columbia Circuit Court’s decision on the Environmental Protection Agency's Mercury and Air Toxic Standards (MATS), owing to the lack of considerations surrounding the cost of MATS compliance. The time frame for compliance with the proposed Clean Power Plan, which would reduce CO2 levels, could be delayed as well.

This could keep some existing coal-fired plants in operation longer than anticipated. Coal-dependent cooperatives and municipalities such as Nebraska Public Power District (A1 stable) and South Carolina Public Service Authority (A1 stable) will benefit from a delay in the implementation of these regulations. The majority of investor owned utilities are largely in compliance already with the MATS.

Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now


Logistics Risk Management in the Transformer Industry

Transformers often are shipped thousands of miles, involving multiple handoffs,and more than a do...

Secrets of Barco UniSee Mount Revealed

Last year Barco introduced UniSee, a revolutionary large-scale visualization platform designed to...

The Time is Right for Optimum Reliability: Capital-Intensive Industries and Asset Performance Management

Imagine a plant that is no longer at risk of a random shutdown. Imagine not worrying about losing...

Going Digital: The New Normal in Oil & Gas

In this whitepaper you will learn how Keystone Engineering, ONGC, and Saipem are using software t...

Latest PennEnergy Jobs

PennEnergy Oil & Gas Jobs