Another bad year for coal

Coal shipments to the U.S. electric sector in 2020 hit their lowest yearly level in 15 years, as pandemic-driven declines in electricity demand accelerated coal’s downward spiral.

Shipments to power providers dropped 22 percent from 2019 to 2020. The 428 million short tons the industry received last year marked the lowest shipment level since the U.S. Energy Information Administration began publishing such data in 2007 — another stark indicator of the coal industry’s waning dominance in the United States.

Last year coal also achieved another new record: 2020 marked the first time it didn’t rank among the top two resource types providing U.S. electricity. Coal provided most of the country’s electricity from at least 1949 to 2015, until natural gas overtook it. In 2020, nuclear power also surpassed coal.

From 2008 on, coal-fired electricity generation dropped 29 percent, according to the Energy Information Administration, as more uneconomic plants retired. The agency also cited less use of the coal plants that remain on the grid as a factor in the resource’s diminishing hold on electricity production; coal-fired electricity dropped by 61 percent from 2008 to 2020.

The Biden administration, which intends to continue to phase out fossil fuels, has created an interagency working group to set out recommendations on helping coal and ​“power plant communities” transition their economies. In April, the Department of Energy announced $109.5 million to support projects that enable job creation in communities impacted by the decline of fossil fuel resources.

Though coal in the U.S. has been on the decline for more than a decade, 2020 was an extraordinary year, and coal demand is forecast to rebound to some degree. The EIA expects consumption to increase in 2021 while production jumps 8 percent, due to increasing natural gas prices.

Beyond the U.S., the global outlook for coal also worsened in 2020. Worldwide coal demand dropped 4 percent, the largest decline since World War II, according to the International Energy Agency. But the organization’s data shows that international coal demand has already begun to rebound in 2021, as economies recover, industrial processes ramp back up and electricity demand increases. That’s spurring expectations for a surge in worldwide emissions.

“Global carbon emissions are set to jump by 1.5 billion [metric tons] this year — driven by…the resurgence of coal use in the power sector,” said Fatih Birol, the IEA’s executive director, in an April release. ​“This is a dire warning.”