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Electricity Monthly Update

With Data for July 2014  |  Release Date: Sep. 25, 2014  |  Next Release Date: Oct. 24, 2014

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Resource Use: July 2014

Supply and fuel consumption

In this section, we look at the resources used to produce electricity. Generating units are chosen to run primarily on their operating costs, of which fuel costs account for the lion's share. Therefore, we present below, electricity generation output by fuel type and generator type. Since the generator/fuel mix of utilities varies significantly by region, we also present generation output by region.

Generation output by region



map showing electricity regions

Net generation in the United States decreased 2.3% in July 2014 compared to the previous year. This decrease in electricity generation occurred because temperatures as a whole were above average across the country last July, while temperatures in July 2014 were closer to average. This led to a decrease in demand for electricity generation in July 2014, with total population-weighted cooling degree days down 12.3% compared to July 2013. At the region-level, changes in electricity generation from the previous July were mixed. The Northeast, MidAtlantic, and Central regions all saw decreases in electricity generation compared to the previous year, while the West, Southeast, Texas, and Florida all saw increases in electricity generation.

Compared to the previous July, the change in electricity generation from coal was split throughout the regions. The Northeast, MidAtlantic, Central, and Texas all saw decreases in electricity generation from coal, while the Southeast, West, and Florida all saw increased coal generation. The change in electricity generation from natural gas was also split throughout the regions. The Northeast, MidAtlantic, Central, and West regions all saw decreases in natural gas generation, while the Southeast, Florida, and Texas all saw increases in electricity generation from natural gas.

Total electricity generation from nuclear generations in the U.S. was up 2.0% compared to July 2013. For the second consecutive month, the Central region had the largest percentage increase in nuclear generation compared to the previous year. This occurred because the Monticello and Fort Calhoun nuclear plants were offline in July 201 3 (and Fort Calhoun nuclear plant had been offline since May 2011 due to damage caused by severe flooding). Both nuclear plants were online and operating a normal capacity in July 2014. Electricity generation from hydroelectric generators was down 10.9% in the U.S. compared to last year, with all regions of the country, except for the Central region, experiencing a decrease in hydroelectric generation.

Fossil fuel consumption by region





map showing electricity regions

The chart above shows that the change in total coal consumption mirrored the change in electricity generation from coal in each region.

The second tab compares natural gas consumption in July 2013 and July 2014 by region. This consumption pattern mostly mirrored the change in electricity generation from natural gas, with the Central region having the largest percentage decrease in natural gas consumption and Florida having the largest percentage increase.

The third tab presents the change in the relative share of fossil fuel consumption by fuel type on a percentage basis, calculated using equivalent energy content (Btu). This highlights changes in the relative market shares of coal, natural gas, and petroleum. Coal increased its share of total fossil fuel consumption at the expense of natural gas in the Central, Southeast, and West. The Northeast was the only region where natural gas significantly increased its share of total fossil fuel consumption at the expense of coal. In the MidAtlantic, Florida, and Texas, the shares of both coal and natural gas remained relatively flat compared to last July.

The fourth tab presents the change in coal and natural gas consumption on an energy content basis between July 2013 and July 2014 by region. Once again, the changes in total coal and natural gas consumption were very similar to the changes seen in total coal and natural gas net generation in each region.

Fossil fuel prices




To gain some insight into the changing pattern of consumption of fossil fuels over the past year, we look at relative monthly average fuel prices. A common way to compare fuel prices is on an equivalent $ / MMBtu basis as shown in the chart above. The price of natural gas at Henry Hub decreased from the previous month, going from $4.71 / MMBtu in June 2014 to $4.14 / MMBtu in July 2014. The natural gas price for New York City (Transco Zone 6 NY) decreased for the sixth consecutive month, going from $3.39 / MMBtu in June 2014 to $2.73 / MMBtu in July 2014. Like many natural gas prices in the Northeast, the New York City natural gas price is now below the price of natural gas at Henry Hub. This is mainly due to the growth of natural gas coming out of the Marcellus region and a slight increase in pipeline capacity to the Northeast.

For the first time in four months, the New York Harbor residual oil price increased from the previous month, going from $17.44 / MMBtu in June 2014 to $17.78 / MMBtu in July 2014. Regardless, oil used as a fuel for electricity generation is almost always priced out of the market.

A fuel price comparison based on equivalent energy content ($ / MMBtu) does not reflect differences in energy conversion efficiency (heat rate) among different types of generators. Gas-fired combined-cycle units tend to be more efficient than coal-fired steam units. The second tab shows coal and natural gas prices on an equivalent energy content and efficiency basis. The spread between the Henry Hub natural gas price and the price of Central Appalachian coal on a $ / MWh basis narrowed compared to last month, due to the decrease in the price of Henry Hub natural gas. However, because of the continued decrease in the New York City natural gas price, the price of Central Appalachian coal on a $ / MWh basis is now higher than the New York City natural gas price.

The conversion shown in this chart is done for illustrative purposes only. The competition between coal and natural gas to produce electricity is more complex. It involves delivered prices and emission costs, the terms of fuel supply contracts and the workings of fuel markets.

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