ICF International’s latest Energy Outlook reports that new regulations being developed by the Environmental Protection Agency will affect U.S. energy markets over the next 20 years and projects that nearly 20% of the coal fleet could retire in response to new air, waste, and water regulations over the next 10 years.
Among the Outlook’s findings:
Exports will play an increasingly important role in U.S. coal markets, but Central Appalachian coal production will decline because of increased safety and regulatory scrutiny; Northern Appalachian and Illinois Basin coal production will increase as exports continue to expand and more coal plants are retrofitted with scrubbers.
Shale gas production is a game-changer for the North American natural gas market, reducing costs and increasing the rate of growth in gas supplies.
Natural gas price volatility will likely persist over the next several years as gas supply and demand struggle to find a new balancing point.
Rising renewables mandates in PJM, California, and New England along with the loss of key federal incentives should boost renewable energy credit prices through the end of the decade.
The limited cap and trade program for sulfur dioxide (SO-2) and nitrogen oxides (NOx) envisioned in EPA’s proposed Transport Rule will require costly compliance measures in some states but little change in others.