U.S. Coal Stockpiles for Power Plants Reach Highest Level Since First Half of 2020: EIA

U.S. coal stockpiles at power plants, as of May 2024 were at their highest level since the first half of 2020, according to an Aug. 5 report published by the U.S. Energy Information Administration. Coal stockpiles were recorded at 138 million short tons at the end of May, up 0.6 percent compared to the previous month. The monthly increase in coal stockpiles can be attributed to seasonality, as coal stockpiles during a shoulder month like May, build up their stockpiles for usage later in the summer when electricity demand is higher.

Coal usage across the U.S. usually follows the seasonal pattern of electricity generation. Coal consumption historically is highest during the summer and winter. Electric power plants begin increasing their coal stockpiles in the spring, as plant owners plan for the upcoming higher usage during the warmer summer period.

Coal power assets in the U.S. stockpile significantly higher amounts of the commodity than they utilize within a given month, with more than 90 percent of coal fired power stations currently having enough coal in stock to produce electricity for 60 days or more. Coal power plant owners keep stockpiles high, due to the potential of physical delivery constraints impacting the ability to use coal when required.

Coal fired power generation has declined in the U.S. over the last 10 years, as a result so have coal plant stockpiles. A number of factors have led to reductions in coal-fired generation. Coal capacity has diminished because operators have retired about 37 gigawatts, or 17 percent, of the coal-fired generation fleet, since the beginning of 2021. Moreover, natural gas-fired and solar production capacity has increased. Furthermore, grid operators mostly utilize the lowest cost power available at a given point, which in recent years has regularly been solar, wind, and natural gas rather than coal.

U.S. coal usage by the electric power sector was recorded at 385 million tons in 2023, down 43 percent compared to 2016. Coal stockpiles totaled 131 million tons in 2023, down 19 percent compared to stockpiles at the end of 2016.