Coal-to-Gas Switching Looms in Power Sector

摘要

Early indicators are pointing toward significant opportunities for coal-tonatural gas switching in the electric generation sector this year with gas prices estimated to stay in the $2.50-3.00/Mcf range, according to recent analyst notes. This situation will be particularly ripe in the East. A Societe Generale analysis points to an “exceptionally high level of excess gas burn for power generation” as a direct result of the continuing low gas prices and availability of gas delivery capacity for the nation’s power generation sector. Analyst Laurent Key cited gas prices below $2.80 as allowing competition against Illinois Basin-fed coalfired power plants for the first time since 2009.