Deep Blue States Are Burning Coal And Oil To Stay Warm

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Michael Bastasch Contributor
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New England and Mid-Atlantic states are weathering the current cold snap by turning to fuel sources officials have spent years trying to phase out — coal and oil-fired power plants.

In somewhat of a repeat of 2014’s “polar vortex,” a blast of Arctic air has the U.S. Midwest and East Coast in a deep freeze, which is spiking demand for natural gas.

In New England, power plants are burning oil to keep the lights on this week. Temperatures have dropped well-below freezing, sending natural gas prices through the roof, Bloomberg reported.

The natural gas price spike made New England the world’s most expensive power market this week, and with prices so high, plant operators are turning to oil. Oil-fired electricity typically makes up less than 1 percent of the region’s electricity production.

It’s a similar story for the PJM Interconnection, which oversees electricity flows from Illinois to D.C. PJM power plants have turned to coal power as gas prices doubled, or even tripled, across the East Coast.

Coal-fired power generation jumped from around 20,000 megawatts on Christmas to more than 45,000 megawatts on Thursday, according to data compiled by Bloomberg. Demand for oil also jumped sixfold, Bloomberg reported.

“Most likely gas prices are too high,” Tai Liu, a Bloomberg New Energy Finance energy analyst, told Bloomberg. “I’d rather run my coal units if I can choose between the two.”

Cold temperatures are forecast to stay low through New Year’s Day, so natural gas prices could remain relatively high throughout. It’s not expected to get as cold as the 2014 “polar vortex” and system operators aren’t seeing the shortages of natural gas experienced that year either.

This year, power plants have ample supplies to keep the heat and lights on, but demand is strong enough to keep prices high.


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