Week of January 25, 2010
Powder River Basin Coal:
The World’s Greatest Energy Asset
|
"U.S. recoverable reserves of coal are well over 200 times the current annual production of 1 billion tonnes, and additional identified resources are much larger. Thus the coal resource base is unlikely to constrain coal use for many decades to come.”
-- National Research Council, 2009 [1]
|
Steven Chu, U.S. Secretary of Energy, has called U.S. coal reserves “immense.” Nowhere is the extent of these resources more apparent than in the potential of the Wyoming's Powder River Basin (PRB).
A relatively small area in northeast Wyoming provides upwards of 40 percent of all coal production in the United States, and accounts for almost 20 percent of power generation.
In 1980, the PRB produced less than 20 million tons of coal. By 2008, production approached 450 million tons. The availability of PRB coal steadily drove real electricity prices down for 20 years. However, the surge in natural gas generation over the past decade raised prices again. Natural gas prices average four times higher than coal prices and are far more volatile.
As seen in the chart below, the increasing availability of surface coal has been the prime mover in allowing electricity consumption in the United States to grow from 1,535 billion kWh in 1970 to over 4,100 billion kWh in 2008.
Data source: http://www.eia.doe.gov/
1. NRC, http://sites.nationalacademies.org/energy/index.htm
2. “Powder River Basin Coal,” T. Considine, School of Energy Resources, University of Wyoming, 2009
