Coal still in the running with natural gas

October 14, 2013 | By Barbara Vergetis Lundin

Gas-fired generation continued to lose ground to coal for the month of September 2013 when compared to the same time last year, according to energy data from Genscape.

Gas generation profile. Click to enlarge.

Gas-fired generation fell by 10 percent -- or 10,421 GWh -- and was primarily replaced with coal-fired generation which was up 5 percent -- or 6,486 GWh -- year over year. Stronger renewable and nuclear generation also helped displace gas. In the California ISO, wind generation was up 77% on last September, primarily due to the build out of wind capacity in the region.

However, above normal temperatures in much of the Midwest and south-central areas of the United States, coupled with a few key unplanned coal outages, helped give gas-fired generation some life and spur real-time volatility in the power markets. September 11 was the second highest real-time West Hub settle of the year at $107/MWh as Genscape's monitors picked up coal outages at John Amos, Harrison, Conesville, and JM Stuart. At the same time monitored gas-fired generation in the RFC region increased 27% for the week.

During the second week of September, the South Central region of the country also saw an uptick in gas-fired generation as coal backed off. Genscape noted decreased generation from JK Spruce, Oklaunion, and Monticello, as well as a reported explosion at the JT Deely facility. For the month, on-peak average prices at ERCOT's North Hub averaged $43.11/MWh; up 49 percent from September 2012 when prices averaged just $28.98/MWh.

Henry Hub prices rose 6 percent from August and were 24 percent higher than a year ago, while on the coal side only Powder River Basin (PRB) prices were higher than a year ago. Genscape estimates delivered PRB prices to be in the $2.39-$2.84/MMBtu range for the month of September; still very much "in-the-money" when compared to gas, Genscape says.

Through the end of September year-to-date coal-fired generation is 6 percent higher than 2012 while natural gas is 9 percent lower, according to Genscape. After a weaker summer, total power demand has fallen behind by 1 percent or 38,861 GWh, the report notes.

For more:
- see this article

http://www.fierceenergy.com/story/coal-still-running-natural-gas/2013-10-14