By Alex Cook at SNL Energy
The chart comes from the coal and gas report. MMBtu is a million Btus.
Total coal deliveries to power plants in ISO New England Inc. and New York ISO plummeted by more than 75% from 2008 to 2012. Meanwhile, natural gas burned by power plants in PJM Interconnection LLC and the Midcontinent Independent System Operator Inc. more than doubled over the same time frame.
According to an SNL Energy analysis of fuel-burn data reported in monthly EIA 923 filings, ISO-NE power plants had the largest percentage decline among U.S. RTOs in the annual quantity of coal burned between 2008 and 2012, at 77%. The shift away from coal was driven in part by a precipitous fall in natural gas prices over this period, with the annual volume-weighted average price of gas delivered to power plants in ISO-NE falling to $3.61/million Btu in 2012 from $12.15/million Btu in 2008.
A recent SNL Energy analysis noted that natural gas plants now account for more than half of the total electric generation in ISO New England, which has created reliability concerns during periods of peak demand. Last winter, cold weather and pipeline constraints in the Northeast caused spiking basis differentials in the region, with spot prices at the Algon Gates hub averaging more than $17/million Btu in February 2013. ISO-NE recently reported that mitigating the region’s growing dependence on natural gas for electric supply is its highest priority. A potential solution to compensate generators for the costs of holding surplus oil inventories to ensure reliability during periods of gas supply constraints. Read the rest of the report here: http://www.snl.com/InteractiveX/Article.aspx?cdid=A-17843425-12588
Filed Under: News, Policy
