Increased electricity demand amid higher summer temperatures and lower natural gas prices sent natural gas-fired power generation in the Lower 48 states to a record 36 gigawatts (GW) on July 27, the Energy Information Administration (EIA) said on Wednesday.
The so-called natural gas power burn—the natural gas consumed by power plants—hit a daily record of 47.2 billion cubic feet (Bcf) on the same day, the EIA has calculated, based on S&P Global Platts estimates.
Before July 27 this year, the previous daily record for natural gas power burn in the United States was set on August 6, 2019, when power plants consumed a total of 45.4 Bcf of natural gas.
This year, natural gas power burn exceeded 45.4 Bcf per day on seven days in July 2020 and one day in August, the EIA said, attributing the records to the heat wave, lower gas prices compared to the summer of 2019, and growing natural gas-fired capacity across the United States.
In June and July 2020, the Henry Hub benchmark prices averaged 30 percent lower compared to the same months of last year, Natural Gas Intelligence’s daily price series showed.
On the day of the record natural gas burn, July 27, natural gas accounted for 45 percent of all electricity generated in the Lower 48 states, followed by coal with a 24-percent share, nuclear at 17 percent, renewable energy at 12 percent, and other sources at 3 percent, the EIA has estimated.
Abundant and relatively low-priced natural gas – with natural gas power capacity flexible to meet peak demand unlike some renewable and nuclear capacities – has been displacing or replacing coal-fired power generation in the U.S. in recent years.
A total of 103 coal-fired power plants were converted to natural gas or replaced by natural gas-fired plants in the United States since 2011, the EIA said earlier this month.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com:
- Investment Funds Could Miss Out On Multi-Year Bull Run In Oil & Gas Stocks
- Saudi Energy Ministry To Help Build $500 Billion Smart City
- Oil Rallies As Twin Storms Force Shut-Ins In Gulf Of Mexico