Pennsylvania’s Power Generation Mix Changes with Natural Gas Production Growth

This blog was originally posted by the Energy Information Administration (EIA) in their Natural Gas Weekly Update. 

Natural gas production is an industry that affects all industries. Homegrown abundant energy has given us opportunities that we are able to take advantage of every day without even realizing it. We found that this post’s information held great value for those who are trying to track the world’s ever-changing power source hierarchy.

Pennsylvania’s power generation mix changes with natural gas production growth

On May 8, Exelon announced that the company would shut down its Three Mile Island Unit 1 nuclear facility in central Pennsylvania by September 30, 2019. In February 2019, the Three Mile Island facility provided 980 megawatts (MW), or 1.9%, of Pennsylvania’s nameplate capacity. In addition to Three Mile Island Unit 1, EIA’s electric generator inventory data indicate that two coal plants with a combined nameplate capacity of 1,845 MW have retired so far in 2019 in Pennsylvania. As retirements of coal and nuclear plants continue, natural gas-fired generation will continue to have a leading role in Pennsylvania’s electric generation mix.

Natural gas-fired electric generation in Pennsylvania has increased steadily in the past decade. EIA electricity generation data indicate that despite the fall in net electricity generation in Pennsylvania, which has declined steadily by an average of 0.7% per year from 2010-18, natural gas-fired generation has increased both in share and in absolute terms.

In 2010, Pennsylvania generated 230 billion kilowatt-hours (kWh) of electricity. Almost half of this generation came from coal-fired facilities, followed by 34% from nuclear, 15% from natural gas and 3% from other sources such as petroleum, hydroelectric, wind, solar, biomass, and wood. In 2018, of the 215 billion kWh of electricity generated in Pennsylvania, 39% came from nuclear, 36% from natural gas, and 21% from coal, and 5% from other sources.

From 2010-2018, nuclear-fired electric generation grew by 7% and provided an annual average of 36% of the generation mix annually on average. With the shutdown of the Three Mile Island facility, the remaining four nuclear facilities will account for 21% of Pennsylvania’s nameplate capacity.

Between 2010 and 2018, natural gas-fired electric generation rose by 128%, while coal-fired electric generation fell by 60%. Though electricity generation from other sources have increased, these other sources still account for a small share—about 3%–5% of Pennsylvania’s total generation mix.

The increase in natural gas-fired electric generation capacity in Pennsylvania has come with significant growth in the state’s natural gas production. Pennsylvania’s marketed natural gas production reached a new high of 18.6 billion cubic feet per day (Bcf/d) in February, a 2440% increase from February 2010, and a growth of 13% from a year ago. A decade ago, Pennsylvania marketed gas production accounted for just 1% of the total U.S. marketed natural gas production. Currently, Pennsylvania accounts for 19% of U.S marketed natural gas production.

Although 2,825 MW of coal-fired and nuclear generation capacity will be retired in 2019, Pennsylvania is adding new natural gas-fired generation capacity. From 2019–2022, in Pennsylviania, 17 new natural gas-fired plants will be in various stages of development, bringing 8,460 MW of nameplate capacity online by 2022.

Overview:

(For the week ending Wednesday, May 15, 2019)

  • Natural gas spot price movements were mixed this report week (Wednesday, May 8 to Wednesday, May 15). Henry Hub spot prices rose from $2.59 per million British thermal units (MMBtu) last Wednesday to $2.61/MMBtu yesterday.
  • At the New York Mercantile Exchange (Nymex), the price of the June 2019 contract decreased 1¢, from $2.610/MMBtu last Wednesday to $2.601/MMBtu yesterday. The price of the 12-month strip averaging June 2019 through May 2020 futures contracts declined 1¢ to $2.738/MMBtu.
  • Net injections to working gas totaled 106 billion cubic feet (Bcf) for the week ending May 10. Working natural gas stocks are 1,653 Bcf, which is 9% more than the year-ago level and 15% lower than the five-year (2014–18) average for this week.
  • The natural gas plant liquids composite price at Mont Belvieu, Texas, rose by 5¢, averaging $5.73/MMBtu for the week ending May 15. The price of ethane and natural gasoline fell by 2% and 1%, respectively. The price of propane, isobutane, and butane rose by 3%, 2%, and 1%, respectively.
  • According to Baker Hughes, for the week ending Tuesday, May 7, the natural gas rig count remained flat at 183. The number of oil-directed rigs fell by 2 to 805. The total rig count decreased by 2, and it now stands at 988.

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Kelsey Mulac

Kelsey was raised in Indiana, Pennsylvania and attended The Pennsylvania State University where she earned a degree in Communications. Kelsey works as the External Affairs Coordinator at Cabot where she manages external communications, including social media and community outreach projects. Prior to starting her full-time position, Kelsey worked as a summer intern for Cabot while attending Penn State.

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