DOE Grid Study Points Finger at Natural Gas
In a long-awaited study of electricity markets and grid reliability, the Department of Energy has called out natural gas as the No. 1 reason for retirements of coal and nuclear plants, breaking from the Trump administration’s prior talking point blaming regulations and renewables for the nation’s shrinking coal and nuclear fleets.
The report attributes four factors to the increase in coal and nuclear retirements: low-cost natural gas; low growth in electricity demand; an increase in variable renewable energy (VRE); and regulatory compliance.
“The biggest contributor to coal and nuclear plant retirements has been the advantaged economics of natural gas-fired generation,” the report says, noting that natural gas surpassed coal as the largest source of electricity generation in the U.S.
The study goes on to conclude that: “The increased use of natural gas in the electric sector has resulted in sustained low wholesale market prices that reduce the profitability of other generation resources important to the grid. The fact that new, high-efficiency natural gas plants can be built relatively quickly, compared to coal and nuclear power, also helped to grow gas-fired generation.”…
