Americans are on track to use more coal this year — first increase since 2014

Americans' use of coal is set to increase this year — the first time in seven years that annual use of the energy source has risen.

Coal, which accounted for about 20% of U.S electricity in 2020, is on track to generate roughly 24% of the nation's power this year, the Energy Information Administration predicted this week. That's largely because natural gas, coal's main competitor, has gotten pricier in the past year, the agency said.

Still, the spike in coal usage is likely to be short-lived, with the EIA expecting coal power to decline again next year.

"In the United States, coal is in decline — it's been declining rapidly for the past decade," said Lucas Davis, a professor at the University of California, Berkeley, who studies energy economics. "It's up this year, but even at this new, higher level, it's still half of what it was for 2010."

That year roughly coincides with the boom in hydraulic fracturing, or fracking, which flooded the U.S. with cheap natural gas. Gas, a less polluting fossil fuel, was the main driver in pushing coal's share of electricity from roughly half in 2010 to one-fifth last year, aided by utility-scale solar and wind farms, which have also dramatically fallen in cost.

Since last year, however, natural gas prices have nearly tripled. Domestic gas production has been slow to rebound from the pandemic's impact on the economy. Gas companies are also exporting record amounts of the fuel, leaving less for domestic use.

"Demand's up a little, supply is down a little, and supply is not coming back online as quickly as we'd initially thought," said Ian Lange, an associate professor of economics at the Colorado School of Mines. 

While they're different fuels, coal and natural gas function the same way on the electric grid, providing what's known as baseline power. Once a fossil-fuel plant is turned on, it hums along steadily, delivering a set amount of energy to the grid. That makes it hard to replace in the short term, although long-term, building more solar and wind utilities would fill that gap, said Lange.

He and the EIA expect the spike in coal use to be short-lived, as more states set clean-power targets and more plants close. Today, America's coal power plants only operate 40% of the time, on average (although that figure is set to rise to 50% this year). By 2035, the coal fleet is projected to shrink by half, according to S&P Global Intelligence. 

"The main market for domestic coal is in power plants, and we've been closing a lot of coal power plants," said Lange.