US natural gas consumption for power generation declined during winter 2016-17

Natural gas use for power generation in the United States decreased this past winter, November 2016 –
March 2017, compared to the previous winter, according to the U.S. Energy Information Administration’s (EIA) Electricity Monthly Update.

Natural gas consumption for power generation, also known as power burn, was reduced from 4,420 trillion British thermal units (TBtu) in the previous winter to 3,908 TBtu in this winter, which is a decrease of 11.6 percent. Despite this decline, power burn still exceeded the five-year winter average of 3,606 TBtu by 8.4 percent.

The drop in demand resulted from higher spot natural prices and increased electric generation from coal, hydroelectric, solar and wind, according to EIA.

The 2016-17 winter average spot price of natural gas at the Henry Hub, the U.S. benchmark for natural gas pricing, was $2.99 per million Btu (MMBtu), an increase of 51 percent from the average winter price for 2015-16.

This drop in price can be attributed in part to a period of cold weather from late November through mid-December that increased gas demand as well as warm February and March temperatures resulting in less demand for heating.

Increased use of other energy sources also played a role. Conventional hydroelectric power generation increased from 26.6 percent, solar generation increased by 25 percent and generation from wind increase by 6.2 percent.