US coal production fell by 17% in 2016, its lowest level since 1978

10 Jan 2017

According to the U.S. Energy Information Administration (EIA), coal production in the United States contracted by 17% in 2016 compared to 2015, continuing an eight-year decline from a peak in 2008. In 2016, US coal output reached its lowest level since 1978 at 743 Mt (short tons). Production in the five major coal regions fell by at least 15% (from 16% to 26%) in the Northern and Central Appalachian basins, the Rocky Mountain region, and the Illinois Basin. Coal production in the Powder River Basin (largest producing zone) fell by 17% (-70 Mt).

This fall is related to low gas prices (8.7% decrease in Henry Hub prices in 2016), mild temperatures reducing electricity demand, coal-fired units retirements and lower international demand. The share of coal in power generation continued to decline in 2016 and was even surpassed by gas (30% and 34%, respectively). US coal exports also declined by 23% to 57 Mt, due to a lower demand from Europe (-32% to 26 Mt) and South Korea (-43% to 3.5 Mt).

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