By Laura D’Alessandro; APPA. This article originally appeared in the Nov. 7 issue of Public Power Daily.
Coal stocks at power plants are low in comparison to recent historical norms, the Energy Information Administration said in a Nov. 6 article.
“Coal stocks at electric power plants, which totaled 121 million tons at the end of August, are relatively low in both absolute and days of burn terms relative to recent historical norms. This is true both nationally and in the Upper Midwest,” EIA said.
The United States holds the largest recoverable reserves of coal in the world, but inventories are low at power plants not because of mining. In many cases, rail shipment is a bottlenecked, monopolistic option holding up the process, according to a recent article in Public Power magazine.
To address the ongoing challenge of rail deliveries, leaders of the American Public Power Association, Edison Electric Institute, National Rural Electric Association and other groups wrote a letter to the Federal Energy Regulatory Commission on Oct. 31 urging commissioners to hold a public workshop on the issue.
About two thirds of coal used to generate electric power moves from mine to power plant at least partially by rail, EIA said. Weather-related problems last winter curtailed coal deliveries by rail and this year railroads have had to accommodate record grain harvests and increasing petroleum shipments. EIA said total U.S. rail traffic has increased for every commodity type tracked by the Association of American Railroads.
EIA noted that four very small plants in Minnesota have shut down to conserve coal stocks, but not because they ran out of coal. “Rather, grid operators have opted to dispatch other units during the fall shoulder season, when they have the option to dispatch non-coal units to conserve coal stocks for use during winter, the peak period for power demand in Minnesota and other states in the north of the country.”
In their letter to FERC, the association leaders noted that some utilities “have recently shut down generating units altogether in order to conserve coal and attempt to build up stockpiles for the winter. Such actions have imposed very substantial costs on the ratepayers, customers, members, and citizens of electric utilities.”
EIA said that there have also been reductions in operating levels at plants in several other states as a result of concerns about coal availability. Operators have substituted higher-cost power from other sources, such as natural gas-fired generation, to make up the difference. In addition, some power plants have increased their purchases of coal moved by truck to their power plants, at significantly higher cost compared to usual rail shipments.
Coal is forecast to continue to be the single largest source of electric generation through 2034, according to EIA data. But operating level reductions are currently being seen in several states as a result of concerns about coal availability. Operators are substituting higher-cost power from other sources such as natural gas to make up the difference, EIA said, while other plants have increased coal purchases by truck at significantly higher cost.