Natural gas-fired generation increased 24.1% from July 2004 to July 2005 and petroleum-fired generation was up 6.5% over the same period, according to the Energy Information Administration's (EIA) latest monthly flash estimates of electric power data. Overall retail sales of electricity in July 2005 increased a robust 6.8% from July 2004. The increased sales were primarily driven by an increase of 18.4% in July cooling degree days from last year, continuing the trend of a hotter than normal summer in 2005.
The strong growth in sales and generation is reflected in the use of natural gas and petroleum liquids, the fuels typically used to meet incremental demand. Year to date, natural gas consumption for power generation is up 6.3%, reflecting both demand growth and the continuing introduction of new gas-fired power plants.
Year-to-date, heating degree days are down slightly from 2004 but cooling degree days are up 5.7%, contributing to growth in total retail sales of 2%. Average retail prices for the rolling twelve months ending in July continue to run ahead of 2004 prices by 3.9%, with higher fuel prices the major factor.
Rounding out the power generation fuels list, coal generation was up 2.8% in July 2005 compared to July 2004. Hydroelectric generation was up 11.7% for July and 6.3% year to date, as drought conditions continued to ease. However, the EIA said nuclear generation continues to lag 2004 performance. Generation was down 2.9% from July 2004 and is now down 3% year to date.
"The lower output from baseload nuclear plants, due to greater lost capacity than in 2004 from planned and unplanned maintenance, is another factor contributing to the increased use of natural gas and petroleum," the EIA said in its flash estimate.
The agency said normally stable oil inventories are down 15.2% from July 2004 and dropped by almost 10% between June and July 2005. "It appears that high oil product prices are leading generators to burn down petroleum liquid inventories in lieu of making new purchases of oil. Petroleum inventories at power plants may bear watching as generators approach the winter."
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