Most generator retirements over the past decade were older natural gas-fired units

Older, less efficient natural gas-fired generators accounted for 64% of the total generator retirements between 2000-2010. However, natural gas-fired generators also made up the majority of new capacity additions during the decade. Volatile commodity prices coupled with an excess supply of generation in the early part of the decade contributed to significant retirements in the fleet of natural gas-fired generators. Significant retirements in coal and petroleum also occurred.

The bulk of the natural gas retirements came from older, less efficient generators. The average age of natural gas-fired generators that were retired was 48 years, with an initial operating year as early as 1912. Most of these natural gas generators were steam turbines (see graph below), which tend to be less efficient than combined-cycle generators: in 2010, the average steam turbine operated at a heat rate of 2,000 Btu/KWh more than the average combined-cycle system. Less efficient generators require more heat (in Btu) to generate electricity (in kWh).

Natural gas generation continues to account for an increasing share of total generation. Retirements of a large number of inefficient units accompanied some reuse of old steam turbines in old coal and natural gas-fired plants as a component of new combined-cycle units.

Coal and petroleum-fired units made up the majority of the other retirements. The sum of all coal-fired capacity that was retired in the past decade amounts to only 3% of total coal-fired capacity for 2010. Petroleum retirements have been accompanied by minimal additions over the last decade, contributing to a decline in total petroleum capacity.