Insight
Coal markets: Limiting gas price upside in 2013
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Report summary
In North American gas markets, the worst of times appear to be over. Winter weather has been relatively normal, and the latest gas production figures finally point to declines. Additionally, gas storage withdrawals and observable power-sector gas burns suggest continued strong gas-fired generation levels, even as gas prices have risen from less than $3.25/mmbtu in late February to about $3.90/mmbtu currently. These bullish storage draws have, in turn, pushed gas prices up further. But in...
What's included
This report contains
Table of contents
- Executive Summary
- Where are we now?
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Coal markets: Structural differences, costs, and trends
- Coal market: How it's different from gas
- Coal basins: How they're different from each other
- Powder River Basin: Primary source of short-term coal production elasticity
- Central Appalachia: High stockpile volumes could cushion market tightness
- Illinois Basin: Growing low-cost capacity, but how much upside in 2013?
- Northern Appalachia: Limited spare capacity
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Short-term gas price outlook: Some upside, but not until winter
- Appendix 1: Relevance of spot coal prices in dispatch
Tables and charts
This report includes 9 images and tables including:
Images
- Chart 7. 2013 incremental coal-gas displacement by gas price range
- Chart 8. Gas price outlook and risks
- Chart 1. Delivered Southeast coal cost structure
- Chart 2. Delivered Midwest coal cost structure
- Chart 3. PRB production and Henry Hub prices
- Chart 4. Distribution of implied PRB rail rates
- Chart 5. Coal production growth (vs. 2007)
- Chart 6. Coal production outlook
Tables
- Table 1. Key characteristics of major coal-producing basins
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