EIA: Coal Production to Rise After 2016, Except from Appalachia
The State Journal
15 April 2013
By Pam Kasey
Although total U.S. coal production is expected to rise after
2016, Appalachian coal will not, according to the U.S. Energy
"Appalachian coal production declines substantially from current
levels, as coal produced from the extensively mined, higher-cost
reserves of Central Appalachia is supplanted by lower-cost coal
from other regions," reads the EIA's summary of a partial release
of its Annual Energy Outlook 2013, begun April 15 and to continue
over the coming month.
"An expected increase in production from the northern part of the
Appalachian basin moderates the overall decline," the forecast
The Annual Energy Outlook is the U.S. Department of Energy's most
comprehensive forecast of U.S. energy production, consumption and
market trends. The AEO2013 is the agency's first forecast through
2040, extended beyond the AEO2012's forecast to 2035. The
reference case takes into account policies that are in place. AEO
2013 also includes a low-growth case, a high-growth case and many
alternative policy cases.
These first sections to be released include forecasts of market
trends and discusses legislation and regulation, as well as a
comparison with other projections. Sections to be released through
May 2 include, among others, analyses of competition between coal
and natural gas in the power sector and of the impact of growing
natural gas liquids production.
In its market trends forecast, the agency sees average energy use
per person declining from 2011 through 2040 due to more efficient
appliances and tightening vehicle fuel economy standards. Also
contributing is a continued shift away from manufacturing,
particularly energy-intensive manufacturing. By 2040, energy use
per person is forecast to decline to a level not seen since 1963.
Notably, while the energy intensity — the amount of energy per
unit of gross domestic product — of the economy as a whole falls,
the energy intensity of energy production rises. The energy
intensity of mining activity increases with resource depletion
over time, the EIA forecasts, and the only industry subsector in
which energy intensity increases is refining, as coal-to-liquids
production and the use of heavy crude feedstock, both of which are
more energy-intensive to process than typical crude oil, increase
The aggregate fossil fuel share of total energy use falls from 82
percent in 2011 to 78 percent in 2040 in the reference case, while
use of renewables grows.
Natural gas consumption grows about 0.6 percent per year from 2011
to 2040, led by increased use for the generation of electricity
and, at least through 2020, by industrial use. Coal consumption
remains below 2011 levels through 2030 and ends the period having
increased by an average 0.1 percent per year.
Domestic production of natural gas and oil are seen growing, with
prices remaining low at least through the first years of the
Early declines in U.S. coal production are followed by growth
after 2016 driven by exports and by increasing use of coal in the
electricity sector as electricity demand grows and natural gas
But coal from Appalachia, which peaked in 1990 at 12.35
quadrillion British thermal units, or 55 percent of U.S.
production, falls from its level of 8.5 quads in 2011 to about 7.5
quads in 2040 — just 32 percent of the total.
The detailed forecast figures show production of Northern
Appalachian coal — the kind mined in northern West Virginia and
northward — increasing, while the Central Appalachian coal mined
in southern West Virginia and the surrounding region declining
It has to be noted that, while the EIA points to increased U.S.
production after 2016, it does not project U.S. production topping
the 1998 high of 24 quads at any point in the forecast period.
Energy related carbon dioxide emissions are projected to remain
below the 2005 level through 2040.
Legislation and regulations reviewed briefly in the current
release include, among others, the Clean Air Interstate Rule that
remains in effect following the court's rejection of the
Cross-State Air Pollution Rule in August, Maximum Achievable
Control Technology for boilers, and the renewable energy
requirements and goals in place in 30 states and the District of
Comparisons with other forecasts are awkward. Some forecasts, such
as ExxonMobil's and BP's, include costs for carbon dioxide
emissions in their projections while EIA does not, for example;
the International Energy Agency uses 2010 as a base year rather
than 2011, and all forecasters use varying assumptions.
To look briefly at the comparisons just for coal, the AEO2013
reference case projects the highest levels of coal production and
prices in 2040 in comparison with outlooks available from those
and other forecasters, seven in total; consumption is higher than
in all but two of the other forecasts. The differences are
attributed to the broadly varying assumptions among the forecasts.