US NATGAS
- Analysis shows inflection point for coal-to-gas switching around $3.25 to $3.50 mmcf nationally, with >$11 mmcf being the max for 0 incremental gas-fired generation over coal (see charts below).
- In the US Northeast, New England and Chicago demand zones, summer 2025 prices are averaging $4.10 mmcf, implying daily incremental gas burn of +0.24 bcfd; EGT-SP production region in the Northeast summer 2025 flirting with the high end of the inflection point at $3.54 for the summer strip
- Coal-fired generation capacity greatly diminished from retirements over the past decade, and tighter y/y coal inventories are headwinds for switching and may be less impactful in summer 2025
- Trump posts yesterday on Truth Social for “opening up hundreds of all Coal Fire Power Plants” and is authorizing his Administration to “immediately begin producing Energy with BEAUTIFUL, CLEAN COAL”
- This follows last week’s roll-backs of regulations by the US Environmental Protection Agency on coal-fired power plants climate change, and electric vehicles under the Obama—era’s Clean Air Act. – AP
These new policies may have more impact on 2026 than 2025 as they are facing push back from environmental groups, and the question of how long (if at all) coal generators respond to the new regulatory environment
Tighter and wider view:
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