Wednesday, February 15, 2017

Changes in Coal vs Natural Gas Power Generation

This chart requires some explanation.  I've taken each day's total thermal generation (gas + coal) in the MISO region, and calculated the BCF equivalence.  I then graph this against the natural gas market share of that day's thermal generation.  

There is a polynomial line calculated from the daily data points for each month of winter this year.

What it all means:
  • At every level of thermal power generation, the nat gas share of that generation declined in each subsequent month.  For example, at 10 BCFE of thermal generation, gas had 35% share of that in November, 21% in December, 18% in January, and then finally recovering a bit to 24% so far in February.  
  • This is an attempt to delineate the impact of the rising price of gas through the winter, and now the recent decline as well.  Gas was pretty cheap last November, around $2.75.  Now that gas is settling back to $2.90's, we should see the beginnings of a recovery in market share.  We are, but not in a quick and radical way yet.  There may be latency, or there may be other issues, like gas still too expensive.