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PCCA Journal|3

rd

Quarter 2015

21

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4HE "EST 7AY TO 'ET (OME

Analyst Says U.S. 2015 Coal Production at Lowest Level Since 1987

U

.S. coal production in 2015

is expected to be down

7.5 percent from 2014 and

will be the lowest total

since 1987, a coal analyst for the Energy

Information Administration said in July.

Production totals could get pulled down

further as a mild summer and continued

low natural gas prices weaken domestic

coal demand, said Elias Johnson, who

co-authored the Short-Term Energy Out-

look for July.

“If demand doesn’t really rebound

because of a warm summer, we could

see consumption go even lower and that

could lead to production going down,”

Johnson said.

Production is expected to drop in each

of the three coal producing regions. The

Appalachian region will be down 12.1

percent from 2014, the Interior region

will drop by 2.7 percent, and the West

will drop by 6.9 percent, according to

the EIA. Coal exports are expected to

drop by 10.2 percent.

The EIA also projects coal consump-

tion for electricity generation will decline

by 6.6 percent from 2014 and forecasts

that it will increase slightly in 2016, up

1.3 percent from this year.

Factors behind the drop in consump-

tion include low natural gas prices and

less demand due to a mild winter. A

mild summer could bring down those

totals further, Johnson said.

The recent Supreme Court ruling that

remanded the Environmental Protection

Agency’s Mercury and Air Toxic Stan-

dards (MATS) back to lower courts is

not expected to help as the EIA has not

heard of any generator changing course

on retiring coal plants, Johnson said.

One bright spot for the coal industry

in the report shows that as production

and consumption for electricity genera-

tion are expected to drop in 2015, both

are expected to have modest upticks

in 2016. “We’re expecting gas prices to

rise and expect a little more demand for

electricity,” Johnson said. “Even though

we are expecting more retirements for

MATS, were making the assumption that

the remaining generators will be used at

a higher capacity.”

Continued on page 22