(EnergyAsia, December 7 2012, Friday) — Coal will remain the leading fuel for power generation in the US through 2040, but its share will continue to decline with the growing popularity of natural gas, nuclear and renewable energy sources, said the Energy Information Administration (EIA).

In its latest Annual Energy Outlook report, the EIA predicts that low natural gas prices and the retirement of a sizable amount of coal-fired generating capacity will lead to a “substantial” decline in coal consumption for electricity generation from last year’s 19.7 quadrillion Btu through 2016.

Over the same five-year period, production will decline by two quadrillion Btu, said the EIA.

The US coal sector will only begin to recover from 2016 due to a revival in coal use for electricity generation and exports.

Longer term, the EIA expects US coal consumption for power generation to edge up by an annual 0.1% rate from 19.7 quadrillion Btu in 2011 to 20.4 quadrillion Btu in 2040. Between 2011 and 2016, consumption will fall by 2.7% per year before recovering to grow by 0.7% per year from 2016 to 2040.

The EIA expects domestic coal production to rise by an annual average rate of 0.2% from 22.2 quadrillion Btu (1,096 million short tons) in 2011 to 23.5 quadrillion Btu (1,167 million short tons) in 2040.

From 2016 to 2040, the agency sees US coal production growing by an average annual rate of 0.6%, from 20.2 quadrillion Btu to 23.5 quadrillion Btu.

Electricity production accounts for 91% of US coal consumption. Coal’s share in the US electricity market is seen falling from 42% in 2011 to 35% in 2040.

US power consumption is expected to rise from 3,841 billion kilowatt-hours (kwh) in 2011 to 4,930 billion kwh in 2040 for an average annual growth rate of 0.9%, said the EIA.