When President Trump signed the executive order rolling back the Obama-era Clean Power Plan, many people expected coal to rally – the intent of the executive order was to end the war on coal. However, some industry experts do not foresee a rally in the coal sector at all.
This data comes from a survey of utility executives – to results found that only 4% of executives believe there will be a moderate or significant increase in coal use as part of their utility power mix within the next decade. Rather, 27% believe coal use will decrease moderately, and 52% believe it will decrease significantly.
These same executives are convinced that there would be moderate or significant growth in the utility-scale solar – more than 66% responded with those beliefs. In second place for growth prospects was distributed generation, followed by distributed energy storage. A majority also see grid-scale energy storage solutions being implemented in their region, spurring the growth of wind and even natural gas in the near future as a greater portion of their power mixes. The executives were the least optimistic concerning oil and nuclear, especially for those regions on the cost. Coal was in last place.
The survey was an online test taken by over 600 electric utility employees in the United States and Canada. Utility Drive conducted the test in January of 2017. Approximately half the subjects work at investor-owned utilities. Thirty-two percent work at municipal or public utilities and 14% work at an electric cooperative.
The majority of the respondents stated that they do not believe the new Trump Administration will give any reason to change the outlook for generation resources, according to the report. Only a minority reported that they believe the election will effect forecasts and projections that have been made thus far.
Despite the fact that only 4% believe there will be room for the coal industry to grow, nearly have of the subjects now have a “more positive outlook” concerning coal, due to the election. At the same time, very few see that as meaning they will use more coal as a percentage of their power mixes. This is probably because current operational coal mines and plants will continue to stay in operation as a result of decreased federal regulations concerning emissions.
Concerning other resources, the outlook of these executives remains unaffected by the Trump White House.
The largest and most influential concern for the respondents with regards to their fuel mix are regulations and market uncertainty. This is true of both federal emission limits, as well individual state regulatory reforms. There are too many variables going forward to predict with any certainty the state of the market in few years’ time.
Some of the utilities surveyed back the lawsuits coming from individual states that originally opposed to Obama Administration’s Clean Power Plan in the first place. However, 75% of the executives polled in the survey admit that they want some type of federal policy limiting carbon emissions to become the law of the land. The preferred action: carbon tax.
These executives will continue to pay close attention to both state regulations and those of the new White House, as any change will surely affect their energy mixes, and their regular operations.
