US power plants are expected to consume less coal next year than at any point since President Jimmy Carter was in office, according to government forecasts released on Tuesday.Coal expected to decline by 14% this year.
Although President Donald Trump's mission to revive America's coal industry has tried to boost coal by slashing environmental regulations and installing a former coal lobbyist to lead the EPA, coal keeps losing ground to cleaner and cheaper alternatives. Power companies are rapidly retiring coal-fired power plants and replacing them with dirt-cheap natural gas and increasingly affordable renewable energy.
"It's just simple economics. Coal is not cost competitive," said Frank Nicklaus, a partner at Greentech Capital Advisors, a boutique investment bank focused on sustainable technology.
Coal used for US power generation is expected to decline by 14% this year to 545.8 million metric tons, according to the US Energy Information Administration.
Coal consumed by the electric power sector is projected to plunge below 500 million short tons in 2020 for the first time since 1978, according to the EIA. That would mark a decline of 27% since 2016, President Obama's last full year in office.
"The US power sector's move away from coal is contributing significantly to decreases in US coal production," Linda Capuano, the EIA's administrator, wrote in the report.
The shale boom has left the United States with an abundance of cheap natural gas, which is cleaner burning fossil fuel than coal. That has allowed power plants to switch from coal to natural gas.