Bloomberg: Europe’s Gas Power Capacity Seen at Risk as Utilities Burn Coal

Natural gas-fired power plants accounting for almost 30 percent of Europe’s capacity are at risk of shutting or being mothballed as utilities opt to burn cheaper coal, according to the International Center for Natural Gas Information.

European Union power generators’ demand for gas plunged 33 percent, or 51 billion cubic meters, in the past three years, the organization said today in a report. That equates to a year of French consumption, said Cedigaz, as the center is known. Gas’s share of the EU electricity mix slumped to 19 percent in 2012 from 23.6 percent in 2010, it said.

Coal prices dropped 32 percent between the middle of 2011 and the end of last year as surging U.S. shale-gas production reduced the solid fuel’s share of the nation’s power generation, according to Cedigaz. That prompted producers to export coal, creating a glut, it said. Gas prices, mostly linked to oil, rose 42 percent between 2010 and last year, the report showed.
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