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Electric power sector coal inventories are expected to remain relatively low through 2019

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Posted August 23, 2018

In May 2018, coal inventories, or stockpiles, in the electric power sector totaled 128 million short tons (MMst), 34 MMst (21%) lower than in May 2017, and the lowest at that time of year since 2014. Stockpiles have averaged 35 MMst (22%) lower during the first five months of 2018 compared with 2017.

Illustration by U.S. Energy Information Administration.

Coal inventories typically follow a seasonal pattern, increasing during the spring and fall when electricity demand is relatively low and decreasing during the summer and winter when electricity demand is relatively high. Since the start of 2016, however, the amount of coal stockpiled at electric power plants has been decreasing. Although fluctuations in electricity demand and coal deliveries can affect the levels of coal stockpiles, the primary cause of the downward trend in inventories has been the retirement of coal-fired generating capacity.

Illustration by U.S. Energy Information Administration.

Between 2014 and 2017, end-of-year stockpiles of coal in the electric power sector decreased 10%, from 152 MMst to 137 MMst. Regionally, the largest decline in end-of-year stockpiles was in the South, which saw a 14 MMst (20%) decrease. Coal stockpiles fell by 5 MMst (52%) in the Northeast.

In each month’s Electricity Monthly Update, EIA calculates how long these stockpiles would last assuming no additional coal was received. This value, known as days of burn, considers each plant’s current stockpile level and its estimated consumption rate in coming months. EIA estimates the historical burn rate by averaging the most recent three years of historical data and applying that rate to the upcoming months. As of May 2018, more than half of coal-fired capacity had at least 60 days of burn, with the average near 75 days of burn.

Illustration by U.S. Energy Information Administration.

In EIA’s August Short-Term Energy Outlook, coal stockpiles are forecast to continue to decline through 2018 and to remain low through 2019. By the end of 2018, an additional 7.9 GW of coal-fired capacity is expected to retire. Nearly 90% of the expected capacity retirements in 2018 occur in the South. An additional 4 GW of coal-fired capacity is expected to retire in 2019, with 57% occurring in the West region and 35% occurring in the South.

Source: EIA

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