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Electricity Monthly Update

With Data for October 2016  |  Release Date: Dec. 27, 2016  |  Next Release Date: Jan. 25, 2017

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Resource Use: October 2016

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 increased by only 0.2% from the previous October. This occurred because the country, as a whole, experienced above average temperatures that were very similar to the above average temperatures experience last year. At the regional-level, only the Northeast and Western regions saw noticeable declines in net generation compared to October 2015.

The change in electricity generation from coal compared to the previous October was mixed throughout the country. The MidAtlantic, Southeast, and Texas all saw increases in coal generation from the previous year, with the largest percent increase occurring in the Texas (25.7%). Conversely, the Northeast, Central, Florida, and the West regions saw a decrease in coal generation, with the Northeast region seeing the largest percent decrease (-47.5%) in coal generation.

The change in natural gas generation was also mixed throughout the country, with the MidAtlantic, Central, and Florida all observing increases in natural gas generation compared to last year, while the Northeast, Southeast, Texas, and the West regions all saw decreases in natural gas generation. As a whole, nuclear generation was up slightly (0.3%) compared to the previous October, while renewables generation was up 17.0% compared to last year.

Fossil fuel consumption by region





map showing electricity regions

The chart above compares coal consumption in October 2015 and October 2016 by region and the second tab compares natural gas consumption by region. Changes in coal and natural gas consumption closely mirrored the change in natural gas generation.

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. In October 2016, the Southeast, Texas, and West regions saw increases in the share of coal consumption at the expense of natural gas consumption, while the Northeast, MidAtlantic, Central, and Florida all saw natural gas consumption increase at the expense of coal compared to the previous year.

The fourth tab presents the change in coal and natural gas consumption on an energy content basis by region. The changes in total coal and natural gas consumption were 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 average price of natural gas at Henry Hub decreased from the previous month, going from $3.05/MMBtu in September 2016 to $3.01/MMBtu in October 2016. The natural gas price for New York City (Transco Zone 6 NY) decreased from the previous month, going from $1.33/MMBtu in September 2016 to $1.23/MMBtu in October 2016.

The New York Harbor residual oil price increased from the previous month, going from $7.79/MMBtu in September 2016 to $8.41/MMBtu in October 2016. 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. For the fifth consecutive month, the price of natural gas at Henry Hub was above the price of Central Appalachian coal on a $/MWh basis. This was mainly due to the increase in the price of natural gas at Henry Hub. The price of natural gas at New York City on a $/MWh basis was still below the price of Central Appalachian coal for a eighth consecutive month, with the spread between the two prices increasing mainly due to the decrease in the price of natural gas at New York City.

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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