U.S. coal production will recover to recent historic levels by 2014, according to a new energy market analysis.
Consulting firm ICF International (NASDAQ:ICFI) says the recovery will be driven by increases in electricity demand and exports, as well as increasing prices for natural gas.
Projectsions in ICF's third quarter Integrated
Energy Outlook include:
- The power sector will add 340 gigawatts (GW) of new capacity by 2030
to meet growing demand and to replace nearly 75 GW of coal-fired capacity
that retires in response to air, waste, and water regulations.
- Projected Henry Hub gas prices average $5-$7 per million British
thermal units through 2030. Prices will be high enough to support the robust
supply development projected over time, but not so high as to adversely
influence market growth.
- Some power price recovery occurs in 2010 because of rising natural
gas prices and demand growth, but on-peak energy prices will take many years
to reach 2008 highs.
- New wind capacity accounts for three-fourths of all new renewable
energy additions by 2030. The remainder is divided among biomass, solar,
geothermal, and landfill capacity.
The Integrated Energy Outlook includes five chapters titled Emissions, Gas,
Coal, Renewable Energy, and Power. Each chapter addresses key energy issues.
Some of the issues addressed in the Outlook include how future CO2
regulation, combined with coming regulations for hazardous air pollutants,
ash handling, and water intake, will impact coal unit operation decisions.
The Outlook also discusses what is happening to gas demand today and how that will shape the market in
the future; how an increase in attention to safety issues following the
Upper Big Branch mine disaster and new permitting guidelines for mountain
top removal affected mining costs in Central Appalachia; how states will
meet renewable energy requirements under current state Renewable Portfolio
Standards as well as under a federal standard; and how much longer the
recession will keep power prices down.
