Report: Gas-Fired Generation Will Rise in Pennsylvania as Coal, Nuclear Decline

Power generation from natural gas is expected to rise in Pennsylvania over the next few years, according to the state Public Utility Commission’s (PUC’s) annual report on generation and transmission and distribution capacity released in late August.

The PUC’s “Electric Power Outlook for Pennsylvania 2018-2023” report made public last week projects gas-fired power generation will account for as much as 45% of the state’s installed capacity by the end of 2022, up from about 34% today. It said coal plants will represent 24% of the state’s installed generation capacity by year-end 2022, with nuclear power at 17%. The gas-fired capacity would be nearly double the 23.2% of installed generation in 2009.

The annual assessment of the state’s electricity production also reported that “sufficient generation, transmission and distribution capacity exists to reasonably meet the needs of Pennsylvania’s electricity consumers for the foreseeable future,” and also concluded that “regional generation adequacy and reserve margins of the mid-Atlantic will be satisfied through 2028, provided planned generation and transmission projects will be forthcoming in a timely manner.”

A recent U.S. Energy Information Administration (EIA) report said 17 new natural gas-fired plants will be in various stages of development from this year through 2022, with those facilities representing about 8.5 GW of generation capacity.

Though natural gas leads Pennsylvania in installed generation capacity, most of the state’s power comes from its nine nuclear reactors, which account for about 40% of actual electricity generation. However, 819 MW of that output will be lost when Exelon closes the last operating unit at its Three Mile Island plant by the end of this month.

Natural gas today is responsible for about 30% of Pennsylvania’s electricity production, with coal-fired power at about 21%. Among the newer gas-fired plants is Tenaska’s Westmoreland Generating Station, a 940-MW facility that come online in December 2018, and Panda Power Funds’ Hummel Station, a 1,124-MW combined-cycle plant built at the site of the retired Sunbury coal-fired plant. Hummel entered commercial operation last summer.

Prolific Natural Gas Output

Pennsylvania’s increased use of natural gas for electricity production coincides with the state’s rise in natural gas output. According to the EIA, Pennsylvania produces more than 20% of all U.S. natural gas, with more than 18 billion cubic feet per day (Bcf/d) of production. The state trails only Texas (23 Bcf/d) in output. Daily gas production in Pennsylvania reached a total 6.2 trillion cubic feet (Tcf) in 2018, according to the EIA. The 18-Bcf/d figure today compares to just 750 MMcf/d (million cubic feet per day) in 2009, with the rise almost entirely due to output from wells in the state’s prolific Marcellus Shale play.

The Pennsylvania PUC report said gas-fired generation today accounts for about 34% of the state’s total installed capacity, with coal representing 28.3%, and nuclear 21.9%. It said that in the PJM RTO area, natural gas and coal are at 40.2% and 30.7% of total installed capacity, respectively. The report noted that natural gas generation capacity represents about 85.3% of new interconnection requests in Pennsylvania, or about 11.5 GW. The report said the state has 21 natural gas-fired power plants under construction, with a generation capacity of about 6.4 GW.

The PUC assessment said 76.1 MW of generation capacity was deactivated within Pennsylvania in 2018, and another 4,391.5 MW of capacity gave notice in 2018 that it would be deactivated. That capacity comes from the announced retirements of 15 individual units of nuclear, coal, diesel, and landfill gas generation facilities made last year.

The report also said the North American Electric Reliability Corporation (NERC) provided a reliability assessment of PJM Interconnection, the regional transmission organization, and concluded that PJM will meet its reserve margin requirements, even as baseload power plants are retired.

Darrell Proctor is a POWER associate editor (@DarrellProctor1, @POWERmagazine).