May 14, 2021

U.S. will use less natural gas-fired electricity this summer, EIA forecasts

U.S. will use less natural gas-fired electricity this summer, EIA forecasts


The United States will use less electricity from natural gas-fired plants this summer, the Energy Department said this week.

Increased generation from coal-fired power plants, higher prices for natural gas and a rise in U.S. generating capacity from the renewable energy sector are key drivers to the decrease in natural gas-fired power. 

Natural gas-fired generation is projected to to 420 billion kilowatt hours in summer 2021, representing 37 percent of total generation, or 5 percent less of total generation than summer 2020, the department’s Energy Information Administration said. 

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The decrease in natural gas-fired generation is due, in part, to increased generation from coal-fired power plants, which have become more economical to run than in previous years, according to the administration.

U.S. coal generation is expected to rise this summer to 289 billion kilowatt hours, or 26 percent of total generation, compared to 22 percent of total generation in summer 2020, the department said.

Higher prices for natural gas are another factor in the decrease of natural gas-fired electricity in summer 2021. The U.S. cost of natural gas delivered to electric generators is expected to average $3.13 per million British thermal units this summer, a 46 percent increase from summer 2020, according to the EIA. 

Recent growth in U.S. generating capacity from renewable energy, especially wind and solar, is also displacing some natural gas-fired generation.

Renewable energy sources, not including hydropower, will provide 138 billion kilowatt hours of generation this summer, which represents 12 percent of total U.S. generation, a 10 percent increase from last summer, according to the Energy Department.

Because of possible lower-than-average water supply in the Pacific Northwest, U.S. hydroelectric generation during June, July and August is projected to decline to 71 billion kilowatt hours from 81 billion kilowatt hours last summer, according to the report. 

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