Higher oil prices push up coal consumption

Coal production and consumption will increase this year at a greater rate than earlier predicted, the National Coal Association (NCA) reports. The principal reason is higher world oil prices, which continue to spur demand for American coal by US electric utilities and foreign buyers.

According to a revised forecast, coal production will be 825 million tons in 1980, 6.3 percent or 48.7 million tons over 1979.

Consumption of US coal both at home and for export is expected to reach 799 million tons, an increase of 7.7 percent over last year. Stockpiles will grow by 26 million tons.

Domestically, electric utilities continue to increase the use of coal as a replacement for oil. Market forces -- mainly doubled oil prices of the Organization of Petroleum Exporting Countries -- led utilities to reduce oil consumption to an average of 1.1 million barrels per day during the first six months of 1980, compared with 1.5 million barrels during the same period in 1979 .

This amounts to over one-half of the 10-year goal announced by President Carter in July 1979 before proposing legislation to reduce oil use by utilities.

NCA now expects utility coal consumption to rise by 7.4 percent, up 39 million tons from 1979, to 565 million tons in 1980. Increased coal use by utilities resulted from the addition of new coal-fired power plants and greater production and shipment of coal-generated electricity to oil-dependent areas.

Coal's share or total electricty generation increased from 46.9 percent to 50 .3 percent in the first six months of 1980 compared with the same period in 1979 . Total electricity generation was almost unchanged in that period.