Natural Gas and Electricity in U.S. Joined at the Hip

Increasingly natural gas and electricity production in the U.S. are “joined at the hip.” What do we mean by that? In 2015 more electricity was generated from natural gas-fired generators than from coal-fired generators in the months of April, July, August, September, and October (data for November and December not yet available). Wholesale electricity prices at major trading hubs, on a monthly average basis for on-peak hours, were down 27%-37% across the nation in 2015 compared with 2014–driven largely by lower natural gas prices. It’s not a stretch to declare that natural gas has replaced coal as the #1 energy source for creating electricity. That’s what we mean by nagas and electricity being joined at the hip. Our favorite government agency, the U.S. Energy Information Administration (EIA), provides some context…

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