Coal news and updates

Coal production rebound, lower prices edge out gas in central US generation stack

Coal is outcompeting natural gas generation in independent system operator territories across the central US in 2022 as a rebound in production and a drop in prices make the fuel more competitive.

The recent uptrend for coal has been most clearly apparent in the Midcontinent Independent System Operator where the fuel has captured about 37% of total generation share since the start of January – a nearly six-percentage point gain from December, data from the ISO shows.

Over the same two-month period, market share for gas has remained roughly unchanged at about 30% as coal picks up the slack for lower nuclear and wind output in MISO since the start of the new year.

Since the late autumn months, though, generation share for natural gas in MISO has waned, falling about two percentage points since October and November as generators look for cheaper options.

MISO isn't the only ISO where coal generation is rising. A similar trend is underway in the Southwest Power Pool where coal has captured much of the upside from a steep drop in wind generation in 2022.

Recent momentum for coal-fired generation comes as stronger production and lower prices this year have recently given the fuel a renewed edge in the generation stack. In the fourth quarter of 2021, market share for coal went into retreat, likely fueled in part by supply constraints and high prices.