Platts
Low gas prices likely to sustain North American coaltogas switching: execs

Wednesday, November 14, 2012

Coal-to-gas switching is likely to continue across North America for several years as gas prices remain competitive with coal and more gas-fired power generation capacity comes online, panelists at a conference in Toronto said Wednesday.

Upwards of 19,000 MW of gas-fired generation capacity is under construction in the US and Canada and will be online by 2017, Bentek Energy Senior Energy Analyst Rock Margolin said. Bentek Energy is a Platts unit.
"We are embarking on another phase of gas-fired capacity additions," Margolin told the LDC Forum Canada in Toronto. "Those are not designed to replace coal. Power producers are positioning themselves to take advantage of market conditions."

Over the same period, coal unit retirements totaling 21,413 MW of capacity are planned in the US, according to Bentek data. In Ontario, coal is expected to be eliminated from the generation fuel mix by 2015. It now makes up 3,300 MW of Ontario's 38,300 MW of installed capacity.

One aspect of the future electricity grid that will likely lead to a key role for gas is the addition of more intermittent renewable energy sources, Pessione said, as gas will be necessary to keep the system in balance.

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