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Coal and Electricity Indicators for the Week Ending April 17 (Part 1 of 7) Electricity production falls
The EEI (Edison Electric Institute) publishes the generation data on a weekly basis with a one-week lag. The current report is for the week ending April 10. Electricity generation in the US dropped to 68.4 million MWh (megawatt hours) during the week ending April 10—compared to 69.2 million MWh for the week ending April 3.
The electricity generation was also lower than 69 million MWh during the same week last year. We’ll discuss the divisional breakup more in the next part of this series.
Why it’s important
Over 90% of the coal produced in the US is used for electricity generation. The Utilities segment is coal’s largest end user. As a result, coal and utility investors should watch for a trend in electricity generation.
Electricity storage is expensive. Most of the produced electricity is consumed instantaneously. As a result, electricity generation mirrors consumption.
What does this mean?
Thermal coal is mainly used for electricity generation. A decrease in electricity generation is negative for coal producers (KOL) like Peabody Energy (BTU) and Alpha Natural Resources (ANR)—keeping everything else constant. Also, in the current low natural gas price environment, natural gas may snap the market share from coal. It’s important to note that the weekly generation data is subject to seasonal aberrations. The impact on utilities (XLU)—like NextEra Energy (NEE) and Southern Company (SO)—depends on the regional breakup of electricity generation. We’ll discuss this more in the next part of this series.
Continue to Part 2 Browse this series on Market Realist:
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Alpha Natural Resources Inc.
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CODE : ANR |
ISIN : US02076X1028 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Alpha Natural Res. is a producing company based in United states of america. Alpha Natural Res. is listed in Germany and in United States of America. Its market capitalisation is US$ 580.6 millions as of today (€ 502.5 millions). Its stock quote reached its highest recent level on July 25, 2008 at US$ 99.92, and its lowest recent point on February 19, 2021 at US$ 0.02. Alpha Natural Res. has 49 410 000 shares outstanding. |