The U.S. Energy Department’s July outlook reports that American coal production will increase by 15 percent in 2021
“We forecast U.S. coal production will increase by 78 million short tons (MMst) (15%) in 2021 to total 617 MMst for the year. The expected increase in production reflects greater electric power sector demand for coal. Higher natural gas prices make coal more economically competitive relative to natural gas for electricity generation dispatch. In the forecast, coal production increases by 13 MMst (9%) in the Appalachia region, 14 MMst (16%) in the Interior region, and 51 MMst (17%) in the Western region.
Coal production in the forecast falls by 7 MMst (1%) in 2022 to 610 MMst. The decline is in response to falling natural gas prices in our forecast, which tends to reduce coal use for power generation. Western region production is expected to decline by 6% in 2022, offsetting gains in the Interior (7%) and Appalachia (5%) regions.
Overall production capacity decreased in 2020, and the lost capacity is unlikely to come back online. We expect an increased draw on electric power sector coal inventories in 2021 (25 MMst) and 2022 (23 MMst).
Coal Consumption. We expect a 92 MMst (19%) increase in U.S. coal consumption in 2021. Rising consumption is largely driven by an increase in demand from the electric power sector, which is expected to consume 522 MMst of coal in 2021, 20% more than 2020. We forecast total U.S. coal consumption to decrease 32 MMst (6%), in 2022 to 537 MMst”
Source: U.S Energy Information Administration
