FactSet Blog Gas vs. Coal: The Impact of Volatile Natural Gas Prices on Power

The energy world of the early 2010s looked starkly different from today. U.S. LNG exports were in their infancy, with Sabine Pass yet to commence operations. Declining costs and government subsidies were just starting to propel renewables forward, and AI had not yet gained the widespread attention it has today. Despite all these changes, one might expect certain steadfast principles to hold true, such as aggressively rising gas prices leading to sharp declines in natural gas-fired generation, but even that is changing. Today, we'll examine how volatile natural gas prices affect coal-to-gas and gas-to-coal switching and why that dynamic has been shifting.