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EIA: U.S. Coal Stockpiles Lowest Since 1978

The U.S. Energy Information Administration (EIA) recently said it expected coal-fired power generation in 2021 to be 22% higher than in 2020, producing the first year-over-year increase in U.S. electricity generation from coal since 2014. That higher generation, though, has reduced inventories of coal at the nation’s power plants, with EIA on Dec. 7 reporting its most recent accounting of coal stockpiles showed inventories at their lowest level in more than 40 years.

The agency on Tuesday said coal-fired generation this year has been buoyed by mostly stable prices for coal, while the price of natural gas moved higher. The EIA reported coal stockpiles at U.S. plants totaled about 80 million tons at the end of September (Figure 1), the lowest level since March 1978. The agency said that while the increased use of coal this year is a factor, it also said stockpiles have fallen over the past several years as more U.S. coal-fired plants have been retired, and remaining coal plants are operated less often, reducing the need for larger inventories.

The EIA in its report published Tuesday said that U.S. coal-fired power plants usually stockpile “much more coal than they consume in a month,” and acknowledged that “physical delivery constraints in the supply chain limit how quickly coal plants can increase their stockpiles.” The group said coal consumption by power plants is usually higher in summer and winter when temperatures are warmer or colder, and lessens during spring and fall when milder temperatures are present.

The agency also cited “days of burn,” what it called “another metric to monitor the sufficiency of coal supplies.” That data (Figure 2)  accounts for power plant retirements, and the lower utilization of coal-fired generation capacity. Days of burn is a “forward-looking estimate of current inventory levels [that] uses past consumption patterns to estimate the number of days an inventory level will last, assuming power plants receive no additional coal.”

The government agency said that “because of less coal consumption as well as coal capacity retirements over the past three years, the days of burn of U.S. coal remain within the typical range, even though total stocks are low.”