s 14.GS: CIR410 c. 1 ILLINOIS GEOLOGICAl SURVEY LIBRARY STATE OF ILLINOIS DEPARTMENT OF REGISTRATION AND EDUCATION Production and Consumption of Mineral Fuels in inois, 1933-1964 Robert F. Severson, Jr. ILLINOIS STATE GEOLOGICAL SURVEY John C. Frye, Chief URBANA CIRCULAR 410 1967 Digitized by the Internet Archive in 2012 with funding from University of Illinois Urbana-Champaign http://archive.org/details/productionconsum410seve PRODUCTION AND CONSUMPTION OF MINERAL FUELS IN ILLINOIS, 1933-1964 Robert F. Severson, Jr. ABSTRACT In Illinois, as in other parts of the nation, the con- sumption of energy and the production of fuels has grown rapidly during recent decades . This study traces the an- nual production and consumption of mineral fuels within the state. It also shows the source areas for fuels shipped in- to Illinois and the destination of mineral fuels exported from the state. Despite the fact that Illinois must supply a large share of its petroleum requirements from outside sources, much of the crude oil produced within Illinois is shipped elsewhere. Furthermore, while the state produces coal in excess of its own requirements and exports to other regions, it also imports quantities of coal from other states. Because a large share of the growth in energy con- sumption involved petroleum, which Illinois does not pro- duce in sufficient quantities to meet its needs, an increase of 135 percent in energy consumption from 1933 to 1964 was accompanied by a fuel production increase of only 87 percent. INTRODUCTION National Trends in Energy Consumption In 1900, the United States used energy equivalent to 7893 trillion Btu ob- tained from mineral fuels and water power. By 1964, that total had risen to an es- timated 51, 676 trillion Btu, and the peak of energy consumption has not yet been approached (U. S. Bureau of Mines, 1964, v. 2, p. 7). In 1900, the average U. S. resident was using about 104 million Btu annually, equivalent to about four tons of coal. By 1964, his grandson was using about 270 million Btu, or the equivalent of more than ten tons of coal annually. These per capita figures do not tell the whole 1 2 ILLINOIS STATE GEOLOGICAL SURVEY CIRCULAR 410 story, but they are useful in providing a perspective on the over-all change in to- tal energy used within the nation. Although different types of energy sources have been used to provide this total consumption, coal was the most important until 1952. Coal consumption rose to a peak in the 1920' s and then gradually declined. The new and increased uses and the substitution of petroleum products for other fuels had much to do with the relative decline in the importance of coal. In 1900, the national use of petroleum products was hardly significant, but since then their use has grown steadily and strongly. Today, petroleum products and natural gas each account for more energy than does coal. The importance of natural gas as a marketed product parallels the development of pipelines since World War II. In 1965, natural gas accounted for 31.8 percent, crude petroleum 44.6 percent, and coal 22.9 percent of the energy used in the mineral fuels market. Water power must also be mentioned. Until the early part of the 19th cen- tury this energy source did much for Americans. Water wheels were the main pow- er source for our pioneer and colonial manufacturers— the creeks and streams of the northeastern coastal areas provided abundant mechanical power for early millers and textile manufacturers. However, ways of producing power efficiently in mo- bile units were found, and the importance of the water wheel declined. The per- fection of the steam engine made it possible to have stationary power almost any- where and also gave rise to new forms of transportation. Around 1900, water pow- er was called upon for the development of hydroelectric power. Great changes occurred in the general use of mineral fuels during the past 50 years. With coal, the long-run trend shows that industrial and utility consum- ers are the most important, and retail consumers are of declining significance. Railroads no longer use coal. Railroads and retail consumers accounted for 42 per- cent of coal consumption as late as 1942, but the situation changed significantly after this. Since 1952, utilities have been the primary consumers of coal. The primary use of petroleum products is for transportation. The automobile and the diesel locomotive gave the petroleum industry the dominant position in transportation. The nation' s refineries produce more gasoline than any other prod- uct, with production of distillate oils ranking second. These distillate oils are used for heating, transportation, and industrial purposes. Coal lost much of its home heating market to the petroleum industry. The most important user of natural gas today is industry. The residential consumer, who prefers the cleanliness and convenience of natural gas, ranks second, In general, the national mineral fuel situation can be summed up as follows: The total use of energy in the nation increased more than six times since 1900. Coal was the major source of this energy until 1952, but in a relative sense it is much less important today. The decline in the relative importance of coal resulted from the phenomenal growth in the total use of energy. Most of the total increase in the use of energy was provided by petroleum products and natural gas. Water power still provides only a very small portion of total energy used, but the abso- lute amount of energy produced by water is growing. Coal still serves important needs in cement, coke manufacture, and general industrial use and has a growing market in utilities, though it has lost the railroad and much of the retail market. Petroleum products are used mainly for motive power, although they do provide a significant amount of heating and industrial fuel for the nation. Natural gas is used mainly by industrial consumers, but residential consumers are of increasing importance. MINERAL FUELS IN ILLINOIS PROBLEMS IN ANALYZING STATE ENERGY CONSUMPTION Analysis of the production and consumption of mineral fuels within a state differs from national analysis because of interstate shipments. In a national anal- ysis, interstate data can be ignored because the aggregate sums needed are auto- matically provided. However, in the analysis of a single state, interstate ship- ments greatly affect all aggregate sums and must be carefully accounted for. A satisfactory analysis must include both production and consumption. However, a simple counting of production and/or receipts does not give a fair evaluation of intrastate consumption. A state with a large number of refineries might receive large shipments and seem to consume great quantities of petroleum, though actually a major portion of the refined products could leave the state, rath- er than be consumed within it. Also, the quality of local supplies of a mineral fuel may not be the most suitable for use by local consumers, and thus may lie idle while fuel from other sources is imported. In this paper, an attempt is made to present a total view of mineral fuels within Illinois, first discussing produc- tion and then consumption. Production is examined to determine not only the quantity of production, but also the markets to which Illinois mineral fuels were sent. Total consumption of mineral fuels within Illinois is examined, and then the sources of this total are analyzed on the basis of geography as well as type of fuel. Characteristics of the Data Two specific problems arise in the use of available data: establishment of a suitable basis for comparing the different fuels, and finding or developing adequate data for a long-term comparison of fuel production and uses. To evalu- ate coal, petroleum products, and natural gas in like terms, the Btu has been chosen as a basis of comparison. Table 1 presents the conversion factors for Btu as used in this study. There was no shortage of general statistical data for this project, but be- cause of the widespread sources from which data collected over the years had to be gathered, it was difficult to find comparable data series. This is a greater problem with consumption than with production data. No continuous, comparable data series was available over a satisfactory time span for each of the fuels ex- amined. Data collection methods used by various governmental and trade organi- zations (and in some cases by individual researchers in the same organization) were sufficiently different to make it necessary to choose arbitrarily among the available sources. Data from all these sources were combined and adjusted to provide a series as continuous and uniform as possible. ILLINOIS PRODUCTION DATA Coal was, and still is, the major mineral fuel produced in Illinois. Only since 1925 has it accounted for less than 60 percent of the state' s total Btu of mineral fuel production. The relative importance of coal declined in spite of a continuing growth in total energy consumption, and this decline continued after 1937. In 1940, coal dropped to 55 percent of the total but rose immediately there- after to 60 percent; it now accounts for about 75 percent of the total (table 2). ILLINOIS STATE GEOLOGICAL SURVEY CIRCULAR 410 TABLE 1 - CONVERSION FACTORS FOR MINERAL FUELS 1 Type of fuel Unit Btu per unit Illinois bituminous coal Ton 22,400,000 Natural gas Cubic foot 1,000 Crude oil Barrel 6,000,000 Gasoline Barrel 5,250,000 Kerosene Barrel 5,640,000 Distillate oils Barrel 5,920,000 Residual oils Barrel 6,270,000 Liquefied petroleum gas Barrel 4,011,000 •*■ Source: Coal — Illinois State Geological Survey estimate of coal produced within Illinois. Other fuels — U. S. Bureau of Mines, Information Circular 7582, Oct. 1950, table 19, p. 32. Petroleum production was relatively insignificant compared to coal up to the late 1930' s, but with the discovery of oil in the Illinois Basin at that time, it became extremely important. Commercial natural gas production is a mere trace compared to the other two fuels, and little encouragement comes from geologists to suggest any appreciable increase in the future. Although the data show a relative decline in the share of the fuels market supplied by coal, Illinois mines, in general, have increased production since 1958. More energy is now being used and, therefore, more fuel must be obtained. In some markets, where various fuels can serve a given purpose, there is strong com- petition; in other markets, however, there is little or no interchangeability of fuels. This is especially true in the use of coal and petroleum products in transportation. These products competed for the rail market, where they could do the same basic job, but in the automotive and air transport markets, there is no competition. Coal could not directly serve these markets, even if the petroleum industry did not ex- ist. Automotive and air transport developments actually increased the use of coal indirectly through increased need for complementary production of steel, aluminum, and electricity. Data clearly show that though the relative proportions of coal and oil pro- duction changed, the absolute quantity of mineral fuel energy increased. Though coal production decreased from 1944 to 1954, a more stable and generally rising level of production has been maintained in recent years. Distribution of Illinois Coal and Crude Oil Observations can be made about the geographic consumption pattern for Il- linois coal and crude petroleum, but because natural gas production in Illinois is MINERAL FUELS IN ILLINOIS CO CO O 3 u m ^* co 4J o u i-l ^ O o 4J c 01 u 01 d, CO o o •o CD •o •H > o u CO a. o >x H 00 i-i 01 c w CO 3 CO 4J O pq c o •H r-1 .-1 •r-l )-. .—1 H •H o CO O o co ci CO •. 00 CCN O /-n H ^ U co ^h m U iH 3 -H 3 •u S o to ~-< a CO 01 ■H ■U CM •H i-l "O ^-s 4J •H C M c O )H CO CO 01 3 0) 3 14 C ■o o u 3 B * ^H >-■ U XI oi u n^ 3 fn ■o c C0r^ ^ CO ,^ co 3 w C O J2 O •U XJ M CO 01 >* 4 vf CO C\ N CO (Ti CO CO CO CO N fN IN N m co vo co on co in in no m o> co <"N CN io n rs in cm cm cn co co >n cm on on on o ncoinvoJ H COON H NO MD IN o CO CO CN vf O CnI sf co m CO CO ON vO CO CN o CO CO CO 4J CO DO U ^ r-H a. () CO cu -u ^ oi M 3 eg j-i ^H 01 m CO >< c < > CO CO OJ H m X) m M 3 3 OJ — 1 a C CJ c •H C •5 s H 6 ILLINOIS STATE GEOLOGICAL SURVEY CIRCULAR 410 extremely small, its distribution is not discussed here. Betweeen 50 and 70 per- cent of the coal produced annually in Illinois is consumed within the state. The same is true for about 25 to 50 percent of the state' s crude petroleum. Table 3 shows the distribution of Illinois coal to consumers outside the state. The greatest consumer area was the northwest market, the area west of the Mississippi River, including Missouri, Iowa, Minnesota, Kansas, North Dakota, and South Dakota. Missouri and Iowa are the two most important consumers with- in this region. The next most important area for Illinois coal is the north -central market, those states north of the Ohio River, west of the Appalachian Mountains, and east of the Mississippi River. The main consumers are Indiana, Wisconsin, and Michi- gan. Among these states, Wisconsin consumes the most. Relatively small amounts of Illinois coal were used by the south-central area, those states south of the Ohio River, west of the Appalachians, and border- ing the Mississippi River. The main consumers were Arkansas, Tennessee, Louisi- ana, and Mississippi, but their consumption of Illinois coal stopped after 1956. During World War II, the Canadian market began using Illinois coal. The absolute amounts taken by Canada were not very large (less than a million tons until 1964), but with the decline of Illinois coal production to 40 to 50 million tons annually during the 1950' s, the relative importance of the Canadian market increased, Whereas the bulk of Illinois coal exports head northwest, most of the Illi- nois crude petroleum exports head east. The 50 to 75 percent of total crude oil pro- duction that is not processed within the state finds its way almost exclusively to eastern markets. The bulk of this production goes to Ohio, Indiana, and Michi- gan, designated in table 3 as the north-central market. The next largest consum- ing area is the northeast market, especially New York, Pennsylvania, New Jersey, and Massachusetts. Shipment of crude petroleum to the south-central market, main- ly Kentucky, Tennessee, Louisiana, Alabama, and Mississippi, has declined to nearly nothing. Only relatively insignificant amounts have ever been shipped from Illinois to areas of the nation other than these. In general, then, coal exports from Illinois go almost exclusively northwest- ward, while crude oil goes eastward. The relative amounts tend to change, but be- cause of the proximity of Illinois producers to their older markets, shipments will probably continue to follow established patterns. CONSUMPTION OF MINERAL FUELS IN ILLINOIS The demand for energy within an area is closely related to total population and standard of living, and the over-all demand for fuels within Illinois has in- creased because of both of these factors. From 1930 to 1960, an increase of ap- proximately 32 percent in the state' s population was accompanied by an increase of about 77 percent in per capita energy consumption. As a result, total demand for mineral fuels increased approximately 140 percent during the same period. Today, we make special demands of the fuels we use. Greater quantities are used for motive power because of the great increase in the number of automo- biles. Consumer groups display strong preferences for heating fuels that offer spe- cific advantages. The residential consumer wants a clean, convenient heat, even if it is expensive; his employer, however, clings to considerations of cost and will sacrifice a degree of cleanliness and convenience for monetary savings. Industrial MINERAL FUELS IN ILLINOIS TABLE 3 - DESTINATION OF REPORTED OUT-OF-STATE SHIPMENTS OF ILLINOIS COAL AND CRUDE OIL, 1933-1964 1 Northeast 2* North-central* Northwest 3 * Southeast^ South-central* Canada 3 Undesignated 3 Crude oil (thousand barrels) Coal Crude oil (thousand (thousand tons) barrels) Coal (thousand tons) Crude oil (thousand barrels) Coal (thousand tons) Crude oil (thousand barrels) Coal (thousand tons) Coal (thousand tons) 1933 na^ 585 na 5,594 na 34 na 1934 na 920 na 6,096 na 65 na 1935 na 1,482 na 6,634 na 130 na 2 1936 na 1,590 na 8,222 na 117 na 1 1937 na 1,644 na 8,263 na 91 na 1 1938 na 1,305 na 6,301 na 67 na 9 1939 4,010 1,793 32,546 7,299 289 74 4,239 33 1940 11,991 1,734 58,101 8,129 906 87 5,679 22 1941 17,631 1,948 54,252 7,962 823 70 7,297 29 1942 14,437 2,218 42,843 10,653 1,273 133 4,440 24 1943 11,071 3,295 33,328 12,279 214 181 2,293 582 50 1944 5,454 4,126 35,648 13,260 11 394 3,337 46 185 1945 5,406 4,088 35,823 12,997 17 297 4,608 361 620 1946 5,007 3,423 34,785 11,390 78 249 2,223 176 320 1947 4,382 3,048 32,280 11,764 40 200 3,207 601 831 1948 3,840 3,197 30,236 10,797 140 164 2,416 235 345 1949 1,898 2,206 34,108 7,736 46 89 2,825 184 26 1950 3,640 3,086 30,184 8,487 142 93 1,357 803 16 1951 5,694 2,724 31,680 8,293 154 106 1,141 612 49 1952 6,451 2,337 36,942 7,263 76 749 734 79 1953 5,609 2,336 34,420 7,047 49 543 47 1954 3,292 2,247 40,707 5,674 43 40 566 90 1955 4,939 2,461 48,903 5,772 43 44 102 617 321 1956 5,042 2,343 51,253 5,970 60 37 971 333 1957 2,938 1,923 46,128 3,424 320 1 128 1958 3,546 1,787 48,901 3,446 244 1 120 1959 5,301 1,700 51,082 3,482 59 1 ,306 1960 4,271 1,577 51,886 3,348 1 1 ,150 1961 4,572 1,490 51,583 3,174 1 ,724 1962 1,618 1,593 49,240 3,808 2 ,330 1963 1,021 1,908 48,539 4,286 103 2 ,566 1964 2,302 1,974 43,152 4,140 1,013 2 ,734 Source: Minerals Yearbooks, 1933-1964, U. S. Bureau of Mines. Bituminous Coal Statistics, 1951 and supplements, Illinois Coal Traffic Bureau. No Illinois coal is recorded as having been shipped to this region. 3 No Illinois crude oil is recorded as having been shipped to this region. * na — not available. * Northeast — the Appalachian Mountain states from Pennsylvania northward. North-central — those states north of the Ohio River, west of the Appalachian Mountains, and east of the Mississippi River. Northwest — those states west of the Mississippi River and north of a line parallel to the northern boundary of Arkansas. Southeast — those states bordering the Atlantic Ocean and south of Pennsylvania. South-central — those states south of the Ohio River, west of the Appalachian Mountains, and/or bordering on the Mississippi River. 8 ILLINOIS STATE GEOLOGICAL SURVEY CIRCULAR 410 production also has special needs. Industry has kept ahead of the population growth, and many of the processes of production require specific characteristics of fuels. In some industrial processes, ease of temperature control and freedom from contaminants may be equally as important as minimum cost. Aggregate Consumption of Mineral Fuels Within Illinois Compilation and use of data on the consumption of petroleum products and coal provide two distinct problems. No single data series gives the total amount of mineral fuels consumed within Illinois. However, the U.S. Bureau of Mines Minerals Yearbooks provide figures for petroleum products and natural gas as well as much of the other data needed for this analysis. Table 4 shows consumption of the various mineral fuels within Illinois. It would be useless to discuss petroleum consumption in terms of crude oil, as was done for production. Throughout the discussion of petroleum consumption, the analysis is directed at the utilization of a mineral fuel for purposes of provid- ing power or heat for the ultimate consumer. Because crude petroleum is consumed mainly at refineries, this does not tell the final story about the consumption of petroleum products . (Petroleum lubricants are not used for energy content and are excluded from this study.) The data on coal were the most difficult to collect. No single source was available and, therefore, the method of determining the total coal consumption must be fully explained. The data on the distribution of Illinois coal production were taken from a publication by the Illinois Coal Traffic Bureau (1951 and sup- plements), which also gave relatively complete information on shipments of coal into the Illinois market. Where gaps existed, the missing information was obtained from other publications and added to the figures provided by the Illinois Coal Traf- fic Bureau. Thus, the aggregate coal consumption figures presented in this study are the summation of all recorded receipts within the state, plus all production within the state, less all shipments from the state. These computations are shown in table 5. Although these figures may possibly vary to some extent from the ton- nages actually consumed, they provide the closest approximation that can be made from available data. Beginning in 1933, Illinois consumed slightly more than 1.2 trillion Btu of mineral fuel energy. By 1956, consumption approached the 2.5 trillion Btu level. Hence, the annual consumption of energy provided by these mineral fuels more than doubled in 25 years. By 1964, it was 2.9 trillion Btu. Consumption patterns for specific fuels show that the most important min- eral fuel consumed in 1933 was coal, accounting for about 1.0 trillion of the 1.2 trillion Btu consumed. Consumption of all mineral fuels grew rapidly to meet de- fense and consumer needs throughout World War II, and as late as 1943, coal pro- vided 1.9 trillion of the 2.4 trillion Btu consumed within Illinois. Coal does not compete with petroleum products for the motive power market in Illinois. The rapid growth in use of motive power, especially in the automobile, has been a major factor in the rise of total Btu consumption within the state. The number of automobiles in the state in 1963 was l\ times the number in 1933. Thus, it cannot be said that coal has lost this market to petroleum products. Coal is also at a disadvantage in the residential heating market. Because of the inconvenience connected with coal heat, the domestic consumer prefers nat- MINERAL FUELS IN ILLINOIS -o I i q -. 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