Government says Natural Gas will Surpass Coal in Electric Generation This Year

The federal government is out with a forecast that at some point this year, natural gas-fired generation will surpass coal generation in the U.S. on an annual basis.

Coal has been the dominant energy source for generating electricity in the nation but the Energy Information Administration’s Short-Term Energy Outlook is forecasting the change.

The EIA said natural gas generation first surpassed coal generation on a monthly basis in April 2015. Coal and natural gas were nearly equal in 2015 with each providing about a third of all electricity generation. The government agency said the decline in generation from coal came about largely due to the lower natural gas prices. The movement by the Obama administration to kill the coal industry might also have played a role.

The EIA said other renewable energy resources also influenced the growth of natural gas over coal. But it mainly was the price of natural gas that led to the surge past coal. As the EIA pointed out, particularly low natural gas prices in 2012 after a mild 2011-12 winter led to a jump in the use of natural gas for electrical generation and coal-fired generation was surpassed. But coal responded and gained back its generation share when higher natural gas prices occurred in 2013 and 2014. Gas prices fell again last year, thanks to another mild winter and the coal generation dropped again.

The government also says environmental regulations no doubt played a secondary role affecting the use of coal. The Environmental Protection Agency’s enforcement of the Clean Power Plan, a move challenged by Oklahoma and dozens of other states in the courts, caused some owners of coal-fired power plants to rethink their use of coal and convert power plants to natural gas.