Prices for Powder River Basin coal fell 18 percent in 2012, according to Energy Information Administration data released today.
Prices took a steep hit early in the year during the mild winter months but were on the rise as winter set in. Coal experienced a double whammy this spring as natural gas prices dropped to decade lows and soaked up much of the excess generation capacity. According to the EIA, the statistical agency within the U.S. Department of Energy, April this year was the first time in history that coal and natural gas generated roughly the same amount of electricity in the nation. Natural gas came within 100,000 megawatt hours that month of becoming the nation's fossil fuel of choice for electricity generation.
The price drop coincides with a 9 percent production decline from the nation's top-producing coal market. Record exports
of both thermal and metallurgical coal helped offset declines in consumption in the power sector, the EIA says.
Even so, EIA in early December projected a reversal in 2013 for coal originating from its western region, which includes Wyoming. The administration expects 5 percent production growth in the year for the region, with some Wyoming coal companies expecting a bump in demand.
Meanwhile, natural gas prices were on the general upswing to end about 12 percent higher than they were a year ago, shortly before the steepest declines that prompted budget cuts in Wyoming.
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