Dive Brief:
- Natural gas use in the PJM Interconnection's power plant fleet has jumped in the last two years on low fuel prices, according to the Energy Information Administration (EIA). PJM covers parts of 13 states, including Maryland, New Jersey, Ohio, Pennsylvania and Virginia.
- Even so, coal-fired and nuclear generation still dominate the region's fuel mix. Coal-fired generation represented about 45% of the fuel mix so far this year, down from about 60% in 2008.
- Low natural gas prices have pulled wholesale power prices down in PJM, according to EIA.
Dive Insight:
In the last two years, regions like the Northeast have seen gas use jump sharply on low gas prices, but natural gas use in PJM has remained a small portion of overall use, partly because of cheap coal from the Illinois Basin.
Although gas-fired power plants make up a small portion of PJM's fuel mix, they have dragged power prices down in the region. In the PJM market, wholesale prices are set by the last unit called to run, or the marginal unit, which is typically a gas unit.
