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Natural gas usage surpasses coal industry

By Eric Morris emorris@heraldstandard.Com 4 min read
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Seated in a control room 24-feet atop a drilling platform Wayne VanGorder, of Crown Drilling, oversees the drilling operation at a deep gas well site in Greene County. (Photo by Roberto M.Esquivel|Herald-Standard)

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In this 2011 file photo a gas well worker with Universal Well Services uncouples equipment used in the fracking process at a German Township site.

Coal has long been the energy source of choice to power America, but evidence shows that its popularity may be on the wane in the face of government regulations and the increased production of natural gas.

For the first time ever, natural gas outpaced coal as the top source of electric power generation in the U.S. in April, according to figures released in the most recent report from the U.S. Department of Energy’s Energy Information Administration (EIA).

About 31 percent of electric power generation in April came from natural gas, and 30 percent from coal. Nuclear power came in third at 20 percent.

A drilling boom that started in 2008 has boosted U.S. natural gas production by 30 percent and made the United States the world’s biggest combined producer of oil and natural gas. Hydraulic fracturing has allowed energy companies to tap huge volumes of gas trapped deep underground in shale formations, driving natural gas prices to about a third of what they were a decade ago.

“The Marcellus shale now produces 20 percent of America’s natural gas demand and Pennsylvania continues to play a leading role in leveraging these abundant resources for power generation,” said Marcellus Shale Coalition spokesman Travis Windle.

Few places in the U.S. are as familiar with both natural gas and coal production as southwestern Pennsylvania. In the region operates some of the country’s largest producers in their respective industries.

But while the Marcellus shale industry continues to grow, major coal producing companies have issued significant layoffs over the past year.

Earlier this month, Consol Energy, which operates coal mines in Greene and Washington counties, as well as natural gas wells in several places in the region, cut 180 employees from its Pennsylvania coal mines, citing low prices.

“We continually evaluate our workforce based on current and anticipated activity levels. These are very difficult but prudent decisions given the depressed nature of commodity prices,” said Consol spokesman Brian Aiello.

Consol also eliminated 290 positions from its natural gas and corporate operations.

Last August, Alpha Natural Resources said it would close Emerald Mine near Waynesburg at the end of this year, resulting in the loss of about 500 jobs. The company cited a depressed coal market, a challenging domestic regulatory environment and the fact that the mine is nearing the end of its reserves as reasons for the closure.

The Obama administration next month is expected to complete a so-called Clean Power Plan intended to cut earth-warming pollution from power plants by 30 percent by 2030. The rule will set the first national limits on carbon dioxide coming from existing power plants.

Ed Yankovich, international vice president of the United Mine Workers of America (UMWA) District 2, said the regulations will be death knell for a coal industry that is already showing signs of cracking.

“We are setting ourselves up for an economic disaster,” said Yankovich. “We’re ruining Appalachian communities by going the path that we’re going.

“How they’re writing these policies is very injurious to this industry. They’re trying to erase coal from the map,” he added. “What the (Obama) administration is doing here is not being done sensibly.”

Yankovich said many coal-fired power plants have been shut down over the past several years because energy companies have not been able or have chosen not to comply with environmental regulations. It is no longer commercially viable to meet such regulations, he said.

The further tightening of regulations coupled with booming natural gas production means a deceasing demand for coal.

“In the past five years, you had a bonanza of production from not only the Marcellus and Utica shale foundations, but also from other places out west,” Yankovich said. “The technology of fracking enabled that to happen. We have natural gas in such quantities that no one ever thought would be available.”

According to EIA data, coal was the leading source of energy in the U.S. in 2014, at 39 percent.

Natural gas trailed at 27 percent.

The amount of coal and gas used will continue to vary depending on price.

The EIA said in a May report that it expects the level of coal-generated electricity to rebound as natural gas prices rise later this year and coal-fired plants return from spring maintenance. Overall, the EIA expects about 36 percent of total U.S. electricity generation to come from coal in 2015 and 31 percent to come from natural gas.

The Associated Press contributed to this report.

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