In 2011, the USA had 317.6 GW of coal-fired electric generation capacity. About 88.7 GW of that capacity was retired in the decade that followed. Units fired by bituminous coal accounted for 60 GW, at 68% the largest share. The decline in bituminous coal capacity was due initially to the lower price of sub-bituminous fuel, then by competition from natural gas and wind capacity.
The two coal types most commonly used in the USA’s coal-fired power plants are bituminous and sub-bituminous coal. Generating units that burn bituminous coal were generally older and smaller, leading to more of them retiring than units fuelled by sub-bituminous coal, particularly from 2011 to 2015.
The lower delivered price for sub-bituminous coal (because of more cost-effective mining practices) also makes coal plants that use it more economically competitive than bituminous coal-fired plants. In 2019, the delivered price of subbituminous coal was $1.86 per million British thermal units (MMBtu), compared with $2.26/MMBtu for bituminous coal.
Another important factor in coal capacity retirements is the degree of competition from other electricity generation sources in the regions where the plants operate. Bituminous coal is predominantly mined in the Appalachian Basin and Illinois Basin; it is the primary coal type used in coal plants in the northeast and southeast regions of the United States. However, many of these plants sourced their coal from mines in Appalachia, which quickly became uneconomical following the increase in natural gas production in the nearby Marcellus and Utica shale gas fields.
To take advantage of their proximity to expansive natural gas supply, producers built a large amount of natural gas fired capacity in Pennsylvania and Ohio on top of the Marcellus and Utica shales. Of the 93.5 GW of natural gas capacity built in the United States from 2011 to 2020, 14.3 GW is located in Pennsylvania and Ohio. The build-out of natural gas capacity added to the economic advantage of natural gas, driving bituminous coal-fired plant retirements. Bituminous coal-fired capacity retirements in Ohio and Pennsylvania accounted for 20% of all coal retirements between 2011 and 2020.
Even with lower fuel prices, sub-bituminous coal-fired units are also retiring because of increased competition from natural gas and renewable sources. Sub-bituminous coal, primarily mined in Wyoming, is the dominant coal type used in the central part of the United States. Although coal-fired generation encounters less competition from natural gas in the central part of the country, the rapid growth of wind capacity in the central United States since 2011 has taken market share away from power plants using sub-bituminous coal.
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