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Short-Term Energy and Summer Fuels Outlook

Release Date: April 7, 2015  |  Next Release Date: May 12, 2015  |  Full Report    |   Text Only   |   All Tables   |   All Figures


Electric power sector coal inventories increased by 3% in January 2015 from the previous month, leaving them 16% higher than in January 2014. Coal inventories have now increased for five consecutive months. The month-to-month increase was unusual, as inventories generally decrease during the winter months as coal-fired generation increases to meet winter heating demand. Warmer-than-normal January temperatures in areas where coal-fired generation is important, coupled with lower natural gas prices, contributed to the inventory growth.

Coal Consumption

EIA projects coal consumption in the electric power sector will decrease by 6% in 2015, despite an increase in overall electricity generation. Milder weather in the first quarter of 2015 compared with the same quarter in 2014 and lower natural gas prices are primary factors driving the decline. The retirements of coal power plants in response to the implementation of the Mercury and Air Toxics Standards also affect demand in the power sector and contribute to the decline. The full effect of the coal plant retirements will be felt in 2016, but projected rising electricity demand and higher natural gas prices increase the use of the remaining coal-fired fleet, mitigating the of the retirements as projected coal consumption in the electric power sector increases by 2%.

Coal Trade

Slower growth in world coal demand, lower international coal prices, and higher coal output in other coal-exporting countries have led to a two-year decline in coal exports. EIA projects coal exports will fall to an annual average of 83 million short tons (MMst) in 2015, then remain relatively flat in 2016. Global market conditions for coal are not expected to change significantly through 2016. U.S. coal imports, which increased by more than 2 MMst in 2014 to 11 MMst, are expected to remain near that level over the next two years.

Coal Supply

EIA estimates that U.S. coal production for 2014 totaled 997 MMst, 13 MMst (1.3%) higher than in 2013. EIA expects annual production to decline in 2015 to 926 MMst, as both domestic demand and exports continue to decline, before growing to 941 MMst in 2016.

Coal Prices

The annual average coal price to the electric power sector fell from $2.39/MMBtu in 2011 to an estimated $2.36/MMBtu in 2014. EIA expects the delivered coal price to average $2.31/MMBtu in 2015 and $2.33/MMBtu in 2016.

U.S. Coal Summary
  2013 2014 2015 2016
Prices (dollars per million Btu)
Electric Power Sector 2.34 2.36 2.31 2.33
Supply (million short tons)
U.S. Coal Production 983.9 996.7 926.0 941.4
Imports 8.9 11.3 10.0 10.8
Exports 117.7 97.3 83.3 82.5
Consumption (million short tons)
Electric Power Sector 858.0 851.4 803.3 818.9
Other Sectors 66.5 65.4 64.2 64.4
Total Consumption 924.4 916.9 867.5 883.3
End of Period Inventories (million short tons)
Electric Power Sector 147.9 151.4 144.2 142.2
Total Inventories 200.3 203.2 195.8 193.2

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