ICF International Integrated Energy Outlook Predicts Up to 40 GW of Coal Plant Retirements in the Next Two Decades

ICF International, Inc. - 10.10.2011

ICF International (NASDAQ:ICFI), a leading provider of consulting services and technology solutions to government and commercial clients, has released its Integrated Energy Outlook for the third quarter of 2011. The study highlights the impacts of U.S. Environmental Protection Agency’s (EPA) proposed environmental regulations and the growth of shale natural gas production.

This quarter’s Energy Outlook analyzes the EPA’s Cross State Air Pollution Rule (CSAPR), which was revised on October 6. The Energy Outlook also analyzes EPA’s proposed Air Toxics Rule, coal combustion residuals, and cooling water intake structure standards. Although the combined impact of the rules remains uncertain, the regulations could lead to a total of approximately 50 GW of coal plant retirements, including those retirements announced to date.

Contrary to some projections that indicate environmental regulations will severely impact U.S. coal production, ICF projects that U.S. coal production and prices will remain stable. In particular, demand for low sulfur Powder River Basin coal and low-cost, high-sulfur Illinois Basin coal is expected to be strong.

The Outlook also finds that shale gas production will continue to grow at a rapid pace. However, natural gas prices are expected to remain low in the near term until emissions regulations spur additional gas demand growth in the power sector. Despite the continued growth in natural gas use, the study finds that escalating renewable portfolio standards in California and the eastern U.S. will lead to continued growth in renewable generation capacity and firming renewable energy credit (REC) market prices.

ICF’s Integrated Energy Outlook addresses a number of significant issues, including:

  • How the just announced revisions to EPA’s CSAPR will affect Texas power markets.
  • Why shale gas production keeps growing in this low-price environment.
  • What the release of CSAPR means for SO2 and NOX allowance markets.
  • What the implications of CSAPR are for shifts in regional coal production.
  • How rising renewable requirements will affect REC prices in regions throughout the U.S.

Using a suite of proprietary analytical tools, ICF has a fully integrated assessment of wholesale power, transmission, fuel, and emissions markets in order to offer the most complete picture of the energy industry. By incorporating global expertise from all areas of the industry, the Outlook is able to provide big picture insights about these volatile energy markets, as well as market-specific projections and forecasts. For example, the Outlook shows a significant shift, to renewables and natural gas, which will dramatically affect the wholesale power competitive landscape.

The Outlook offers insight into the key areas of emissions, gas, coal, renewable energy, and power:


  • How state/regional SO2 and NOx markets will evolve under EPA’s new CSAPR.
  • How many coal units will retire and how many will spend the capital needed to comply with hazardous air pollutants maximum achievable control technology (MACT) requirements.
  • What new capacity will be built to replace retired capacity and meet growing demand.
  • How the MACT requirements will interact with pending ash and water regulations.
  • The possible directions for CO2 regulation and its potential impact on control/retire decisions.


  • How current trends in demand will shape the market.
  • How basis differentials are developing given regional supply development and pipeline projects.
  • How shale gas production will change the future of the gas market and how environmental concerns might impact this.


  • Whether eastern coal prices continue to increase.
  • Whether coal exports continue expanding, transforming the U.S. into a major player in global coal markets.
  • How environmental regulations will shift production and consumption trends.

Renewable Energy

  • How activity in California’s new tradable renewable energy credit market will affect prices for bundled RECs in the state.
  • How REC prices in PJM will respond to sharp increases in renewable energy demand over the next decade.
  • Whether offshore wind will provide meaningful contributions toward meeting the New England renewable electricity requirements.


  • Whether the 2010 energy price recovery will be sustained.
  • The regional outlook for on-peak spark spreads.
  • How much environmental policies affect regional price differences.

Additional projections include:

  • Emissions—Allowance prices for federal cap and trade programs (CO2, NOx, and SO2); national pollution control installations, including carbon capture and storage deployment; CO2 emissions abatement by sector; domestic and international emission offset demand.
  • Gas—Regional gas production and consumption; delivered prices; basis differentials and pipeline capacity and flows.
  • Coal—Minemouth prices for nine common U.S. marker coals and three international coals; delivered prices to major power hubs; coal production by region; imports and exports; multi-sector coal consumption; coal distribution.
  • Renewable Energy—REC prices for California, aggregate REC prices for PJM and NEPOOL; renewable generating capacity additions; renewable energy supply and demand forecasts.
  • Power—Peak power prices for five major trading hubs.

For more information regarding the third quarter release of ICF’s Integrated Energy Outlook, please register for our webinar, scheduled for Tuesday, October 11: http://www.icfi.com/energywebinar

For more information:

  • ICF Integrated Energy Outlook: http://www.icfi.com/energyoutlook
  • ICF Energy: http://www.icfi.com/energy
  • ICF Fuels Markets: http://www.icfi.com/markets/energy/fuels-markets
  • ICF Power Market Analysis: http://www.icfi.com/markets/energy/power-market-analysis

About ICF International

ICF International (NASDAQ:ICFI) partners with government and commercial clients to deliver professional services and technology solutions in the energy, environment, and transportation; health, education, and social programs; and homeland security and defense markets. The firm combines passion for its work with industry expertise and innovative analytics to produce compelling results throughout the entire program lifecycle, from research and analysis through implementation and improvement. Since 1969, ICF has been serving government at all levels, major corporations, and multilateral institutions. More than 3,700 employees serve these clients worldwide. ICF's website is http://www.icfi.com.

Caution Concerning Forward-looking Statements

Statements that are not historical facts and involve known and unknown risks and uncertainties are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Such statements may concern our current expectations about our future results, plans, operations and prospects and involve certain risks, including those related to the government contracting industry generally; our particular business, including our dependence on contracts with U.S. federal government agencies; and our ability to acquire and successfully integrate businesses. These and other factors that could cause our actual results to differ from those indicated in forward-looking statements are included in the "Risk Factors" section of our securities filings with the Securities and Exchange Commission. The forward-looking statements included herein are only made as of the date hereof, and we specifically disclaim any obligation to update these statements in the future.


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