Natural gas now exceeds coal on U.S. power grid

By James Osborne, Dallas Morning News, Published December 24, 2015 12:05 PM

Natural gas has now usurped coal as the nation’s primary fuel for generating electricity.

According to a report Thursday by the U.S. Energy Information Administration, in April less electricity came from coal than natural gas for the first time since at least 1973. It happened again in July and continued four straight months into October - the most recent month for which data is available.

The shift in fuel use in the power sector comes as gas prices fall to historic lows, driven down by the flood of hydraulic fracturing and horizontal drilling operations across the Midwest and Texas. Gas was trading at just under $2 per MMBtu on the New York Mercantile Exchange Thursday, a more than 40 percent drop from a year ago.

At the same time tougher federal standards on air pollution require coal plants to install costly scrubbers on their smokestacks – forcing plants to go offline during times of lower demand and in some cases even closing all together.

The pressure on the coal industry is only expected to increase in the decade ahead, after President Obama ordered the nation’s power industry to drastically redudce carbon emissions by 2030 in an effort to slow global warming.

In Texas, which is less dependent on coal than many states, the shift away from coal has been underway for some time. The last time coal was the leading fuel for electricity was May 2014, according to data from the Electric Reliability Council of Texas.

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