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Electricity Monthly Update

With Data for September 2018  |  Release Date: Nov. 27, 2018  |  Next Release Date: Dec. 26, 2018

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Resource Use: September 2018

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 6.2% compared to September 2017. This increase in electricity generation occurred because the country, as a whole, experienced a very warm September this year compared to the previous year. This led to a greater need for residential customer cooling for the country during September 2018 compared to the previous September, which increased the need for electricity generation compared to a year ago. At the regional-level, almost all parts of the country saw an increase in electricity generation compared to the previous September, with only the Western region seeing electricity generation remain relatively flat compared to September 2017.

The change in electricity generation from coal compared to the previous September was mixed throughout the country, with the Northeast, Central, and Southeast seeing increases in coal generation, while the MidAtlantic, West, Florida, and Texas all saw decreases in coal generation compared to a year ago. All regions of the country saw an increase in electricity generation from natural gas compared to September 2017. For the second consecutive month, the Southeast and Central regions saw the largest increases in natural gas generation, up 6,691 GWh and 4,028 GWh, respectively, compared to the previous year.

Electricity generation from other renewables increased in all parts of the country, except for Texas, compared to the previous year. Nuclear generation decreased 5.0% compared to September 2017, as many nuclear units were offline for scheduled maintenance.

Fossil fuel consumption by region





map showing electricity regions

The chart above compares coal consumption in September 2017 and September 2018 by region and the second tab compares natural gas consumption by region over the same period. Changes in coal and natural gas consumption were similar to their respective changes in coal and 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. All regions of the country saw an increase in the share of natural gas at the expense of coal in September 2018.

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 increased slightly from the previous month, going from $3.05/MMBtu in August 2018 to $3.09/MMBtu in September 2018. The natural gas price for New York City (Transco Zone 6 NY) decreased from the previous month, going from $3.11/MMBtu in August 2018 to $2.90/MMBtu in September 2018. For the fourth consecutive month, the average price of Central Appalachian coal saw an increase from the previous month, going from $3.12/MMBtu in August 2018 to $3.19/MMBtu in September 2018.

The New York Harbor residual oil price saw an increase from the previous month, going from $12.42/MMBtu in August 2018 to $12.73/MMBtu in September 2018. Unlike the beginning of the year, oil used as a fuel for electricity generation was priced out of the market during this month.

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 price of natural gas at Henry Hub ($24.76/MWh) was below the price of Central Appalachian coal ($34.46/MWh) on a $/MWh basis, with the spread between the two increasing from the previous month, mainly due to the rise in the Central Appalachian coal price. The price of natural gas at New York City ($23.24/MWh) was below the price of Central Appalachian coal ($34.46/MWh) during September 2018. The spread between these two prices increased from the previous month, mainly due to the increase in the price of natural gas at New York City from the previous month.

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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