HomeNewsEIA: U.S. summer gas use for power to reach 2023 record

EIA: U.S. summer gas use for power to reach 2023 record

5/31/2024

The U.S. Energy Information Administration (EIA) expects U.S. natural gas consumption for electricity generation to average 44.7 Bft3d this summer, on par with the record set last summer. U.S. electricity generation is projected to grow by 3% this summer, driven by renewables.

The EIA forecasts that the natural gas consumed for electricity generation this summer in the U.S. will reach near the record set last year. Despite a 3% increase in overall U.S. electricity generation this summer, the EIA does not expect natural gas consumption for electricity generation to grow. Growth in electricity generation will be largely driven by increased renewable energy production.

In its May 2024 Short-Term Energy Outlook (STEO), the EIA forecasted natural gas consumed to generate electricity will average 44.7 Bft3d in the U.S. during the peak summer months of June–August, matching the record high set in the summer of 2023.

Over the past few years, the balance of sources of electricity generation in the U.S.—especially in the summer—has shifted to more renewables and natural gas and less coal. U.S. natural gas-fired electric power generation has increased most years since 2014 as natural gas-fired generation has become more competitive with coal. Natural gas-fired generation capacity has increased over this period as well.

Since 2014, U.S. electric grid operators have increasingly dispatched natural gas-fired generation to meet growing electricity demand at the same time that U.S. natural gas production has increased. More efficient combined-cycle gas turbine (CCGT) power plants, along with increased availability and relatively low prices for natural gas, have made natural gas-fired generation cheaper to run, increasing the use of natural gas as an electricity source compared with coal. Total U.S. natural gas-fired generation capacity has grown by 19%, or 79 gigawatts (GW), since 2014, and generation has grown 60%, or 675,000 gigawatthours (GWh), according to data from the EIA’s Electric Power Monthly. Between 2014 and 2023, the average annual capacity factor has also increased from 49% to 59% at CCGT power plants.

Simple-cycle natural gas turbine (SCGT) plants, normally used as peaking plants, are dispatched more frequently in summer months when daily fluctuations in electricity demand are highest. SCGT plants have increasingly been used in the summer, which is a major contributing factor to growing natural gas-fired electricity generation. Between 2014 and 2023, the capacity factor at SCGT power plants grew from 8% to 14%. The SCGT power plant capacity factor in 2022 and 2023 averaged more than 20% for parts of the summer.

As electric generation capacity from renewable sources grows, natural gas is used increasingly to balance the intermittent nature of electricity produced from wind and solar. Since 2014, the share of U.S. electricity generation from natural gas in the summer has increased almost every year except 2021, increasing from 29% in 2014 to 46% in 2023. In 2024, the EIA forecasts a slight decline in the share of U.S. summer natural gas-fired electricity generation to 44% and a shift to more electricity generation from renewable sources, particularly solar. Electricity generation from renewable sources has increased steadily since 2018, largely due to increased wind and solar generation capacity.

Coal-fired electricity generation has been declining since 2014 as coal-fired generation has become less competitive. During the summer of 2023, coal-fired electricity generation decreased 51%, or 218 billion kilowatthours (BkWh), when compared with the summer of 2014.

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