Fossil fuel consumption in the U.S. power sector has fallen to a 23-year record low with a slightly offsetting increase in the use of natural gas, the U.S. Energy Information Administration (EIA) finds. Overall fossil fuel-burn for power generation fell to 22.5 quadrillion British thermal units (quads) in 2017, the lowest level since 1994.
Use of combustible, or fossil fuels, for power generation has fallen by 1% in OECD countries over the course of 2017, according to a monthly assessment compiled by the International Energy Agency (IEA). In the Americas, the contribution of fossil fuelled power plants decreased 144TWh amid greater renewables deployment. In Europe, by contrast, the use of fossil fuels grew by 80TWh, as natural gas and coal-fired power plants had to compensate for a low-hydro-year and falling nuclear power supply.
Jan 23 – Robust winter demand has propelled up gas prices in Northern China, prompting the government to ease restrictions on coal-burn for power generation. Domestic gas production subsequently increased. In December alone, gas production stood at 13.61 Bcm, up 2.3% year on year - the highest monthly rise since 2010, according to the National Bureau of Statistics (NBS).
Mexico, the largest offtaker of US pipeline gas and LNG importer from Peru, Nigeria and the US, is getting ready to launch an online gas trading platform by the summer of this year, at the latest. The Federal Electricity Commission (CFE), Mexico’s state-owned grid operator, also plans to set up several gas pricing points. “We'll have Henry Hub, too, as that's what we now have,” said Javier Gutierrez Becerril, director of operations at CFE Energy.
Chinese authorities have mandated power producers in some regions to return to burning coal, responding to acute gas shortages. Coal imports rebounded from a three-month low in November as utilities seek to replenish stocks prior to the period of peak winter demand.
China’s new'2+26' cities policy – a pledge to cut emission in the country’s 28 northern cities by 15% year-on-year in the winter months – is limiting the use of coal for power generation and in industries. As an alternative to coal, gas demand could rise by 23 bcm this year compared to previous winters, according to WoodMackenzie projections. In fact, Chinese LNG imports almost doubled last month, surging 95.7% compared to October 2016, to reach 3.57 million tonnes, according to data from the General Administration of Customs.
Gas-burn for power generation in Spain has ended the month of August with an increase of over 60% to reach 7,800 GWh – the highest figure for this month since 2011, according to Enagas figures. The steep increase in the contribution of gas in the Spanish power mix was caused by very low hydro power availability and a lower generation from wind power.
Natural gas-fuelled power generation in the United States reached its highest daily level at 41 Bcf/day on July 20 – just a tick lower than the 2016 peak of 42 Bcf/d seen on August 11 last year. Higher gas prices relative to last summer explain part of the decrease; but PointLogic Energy analysts stressed that “although power burn in 2017 is lower than in 2016, it is still relatively high compared with the previous five-year average for that period.”
July 6 - Consumption of natural gas has risen in 9 of the past 10 years, according to EIA figures. As recently as 2006, the United States consumed more coal than natural gas (in energy-equivalent terms), but as gas use has increased—particularly in the electric power sector, where gas-burn in 2016 was about twice that of coal.
June 6 – The United States’ electric power sector in 2016 consumed 35% less coal than in 2008, when domestic coal production reached its highest level. However, the share of coal shipped to U.S. power generators by rail has consistently remained near 70%. According to EIA figures, coal-burn in the power sector totalled 677 million short tons in 2016, the lowest amount since 1984.