Over lunch at a recent energy conference, a fellow attendee asked where I worked and what I did, and I explained that I lead coverage of the US thermal coal market for S&P Global Platts. The gentleman, who worked for a group that finances renewable energy projects, had several questions about coal, and each answer seemed to only increase his incredulity. “So, let me understand,” said the gentleman finally. “You are bullish on coal?” No, I’m not. In the US, thermal coal is facing a long-term decline in demand, driven by cheap natural gas, an increase in renewable generation, and state and local authorities intent on reducing carbon emissions. But what gets lost in a blur of doom-filled headlines is the fact that a significant amount of electricity consumed in the US is still fueled by coal. In 2016, the US power sector consumed 677 million short tons of coal, generating 1,240 TWh of electricity, or 30.4% of the nation’s electricity, according to Energy Information Administration data. Power sector coal consumption was down 8.3% from the 738 million st burned in 2015, and down 20.5% from the 852 million st burned in 2014. But those drops were largely the result
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Source: CTRM Center