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- W2024202956 abstract "Editor's Note: The following is the last in a series of four articles concerning inter-industry competition in the domestic fuel market. Published in consecutive issues of JOURNAL OF PETROLEUM TECHNOLOGY, each of the papers approaches the widely (and often heatedly) debated subject from the viewpoint of a different segment of the energy producing-marketing field. Obviously, the ideas and opinions expressed do not necessarily reflect the views of the majority of SPE members but, rather, are presented solely for the purpose of providing the reader with further insight into this controversial problem. General Trends Since 1950 During the last decade, pronounced changes occurred in the competitive pattern of the fossil fuels. The purpose of this paper is twofold--to describe interfuels competition as it relates to the overall economy, andto examine the comparative positions of the fossil fuels as they compete in a specific market the electric utility industry. Table 1 shows the growth in the consumption of coal, oil, gas and water power during the past decade. Uses which are not directly competitive among the fuels, such as tractor fuel, carbon black and consumption of petroleum products in the making of synthetic rubber, have been excluded from these statistics. The experience of the three fossil fuels in competition since 1950 shows that natural gas has expanded approximately twice as rapidly as oil-with gas-consumption growing 219 per cent compared to a 124.1 per cent growth in Btu's of oil consumed in the 10-year period. Percentagewise, water power did little more than hold its own, and coal (including anthracite) actually decreased more than 20 per cent. Looking at this another way, in 1950 coal accounted for 50.6 per cent of the total competitive fuel market; 10-years later, however, its contribution had dropped to 33.8 per cent--still more than any competing fuel, but only slightly higher than natural gas. Hydro power has not been considered in this study because it has grown but slightly since 1950; throughout the 10-year period, it has played only a very minor part in the competitive fuels picture. Omitting water power, therefore, the three fossil fuels together have picked up a net consumption of 4.1 quadrillion Btu's during the decade. Individually, natural gas gained 5.5 and oil 1.5 quadrillion, while coal lost 2.9 quadrillion. With the exception of the electric utility market, relatively little of a reliable nature is known about detailed costs and Btu content involved in the consumption of these competing fuels in industry, in general commercial use and in residential use. With respect to the third category, information is available for gas and oil, particularly gas; but residential coal consumption is an area for which few data are available. Since 1950, therefore, natural gas has made substantial strides in penetrating the competitive market for fuels, while oil (excluding noncompetitive uses) has had a much more sluggish growth. As noted, water power is considerably less important than any of-the fossil fuels and, of course, is limited to the field of power production. Coal's slippage in the competitive market, at least partly the result of below-cost pricing practices by some of its competitors, may slow down or the trend may even be reversed if current cost trends in the three industries are maintained. However, this possibility will not be explored here. Fossil Fuels Consumption in the Electric Utility Market Fortunately, complete and accurate statistics are available to show the experience of each of the fossil fuels in meeting the energy demands of the electric utility industry. Tables 1 through 4 are based on information furnished the Federal Power Commission by all but a very small number of electric power companies. These official reports permit an analysis to be made of trends and relationships among the fossil fuels, an analysis which is not practicable in any other market jointly served by coal, oil and gas. Table 2 shows, for the United States and for each of the four U. S. Census Bureau regions where coal, oil and gas are in active and effective competition, the 1950-to–1959 growth of utility consumption of each of these fuels in terms of coal or coal equivalent tons. Inclusion of other regions where coal's sales are negligible, or where any one of the three fuels far out-distances the others in consumption, would distort this comparison and would make it meaningless for the most part. P. 1071^" @default.
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- W2024202956 date "1961-11-01" @default.
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- W2024202956 title "Competitive Patterns in tile Electric Utility Market-The Fossil Fuels" @default.
- W2024202956 doi "https://doi.org/10.2118/34-pa" @default.
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