Electricity generation by division in the US
The chart below shows the weekly electricity output and week-over-week change in production levels across different divisions in the US. The Edison Electric Institute (or EEI) provides weekly electricity production data by division across the US.
Electricity generation continues to drop
Electricity production across all divisions except the Pacific Southwest dropped during the week ended March 13.
The Southeast led the fall with a 12% (or 2.5 million MWh[1. megawatt-hours]) fall in electricity generation to 18.2 million MWh, compared to the previous week’s 20.7 million MWh.
The Central Industrial division saw a 13% (or 1.9 million MWh) drop in electricity generation. Generation in the Pacific Southwest increased marginally, making it an exception for the second straight week.
Impact on coal
Historically, the Eastern US was served by coal producers in Appalachia and the Illinois Basin, while the Western US was the Powder River Basin’s (or PRB’s) territory. Since PRB coal is the cheapest, there might be some movement of PRB coal to the eastern states. However, the historic equation largely remains the same. A fall in electricity generation in the Southeast isn’t good news for Appalachia and Illinois Basin coal producers (KOL) like Peabody Energy (BTU) and Alpha Natural Resources (ANR).
Weekly coal production data may offer some idea about coal’s demand for electricity generation. However, demand for coal also depends on natural gas prices. In the next part of this series, we’ll take a look at coal shipments (which mirror demand) in the US for the week ended March 13.