Coal production on the rise, still not at 2015 levels

Coal production rose in the second half of 2016, after falling in six out of the seven quarters between mid-2014 and mid-2016, according to the U.S. Energy Information Administration. But coal production in 2016 was still less than it was in 2015.

The Powder River Basin in Montana and Wyoming saw the largest rise in production in the second half of 2016. The increase was driven by the rise “in coal-fired electricity generation, which occurred as natural gas prices increased,” according to the EIA.

More than 90% of U.S. coal is used for electricity generation. “During the third quarter of 2016, warmer-than-normal temperatures led to increased electricity generation — the highest on record for those three months combined — which resulted in higher consumption of coal compared to the first half of 2016,” the EIA shows.

Electricity generation declined in the fourth quarter because of high natural gas prices. Natural gas power generation fell while coal-fired electricity generation slightly increased. In December, coal-fired generation surpassed natural gas power generation for the first time since January 2016.

Production in the Powder River Basin rose in most of the first half of 2016 through the second half of 2016. Coal production in other regions, such as the Appalachian and Illinois basins, was flat. Almost all of the 29 states that receive coal from the Powder River Basin “increased their consumption during the second half of 2016,” according to the EIA. Texas, Illinois, Missouri and Wisconsin accounted for about half of the increase.