Maintaining Reliability: The Critical Role of Natural Gas Generation

Over the past 20 years, the U.S. electric generating fleet has shifted dramatically as coal and nuclear plant retirements have occurred in rapid succession. Amid a growing list of baseload retirements, addition of intermittent generation sources such as wind and solar, and soaring electricity demand, natural gas has filled the gap and become a leading source of firm generation capacity for electric cooperatives and the overall U.S. energy mix.

According to the U.S. Energy Information Administration (EIA), last year, natural gas made up over 43% of the total U.S. generation mix and is now the dominant fuel for electric generation as coal usage has plummeted from its peak in 2007. Electricity generated from renewable sources has followed the same trajectory as natural gas and will continue to grow. The trend is even more dramatic here in Iowa. EIA reports that in 2023, wind turbines generated 59% of Iowa’s electricity, the highest share for any state.

Americans are more reliant on electricity than ever before, and rightfully less tolerant of service interruptions. As the energy sector continues to face the growing demand for electricity and a push for more renewable sources, always-available natural gas-fired generation will become increasingly important. In fact, according to data from S&P Global, electric cooperative suppliers have nearly 9,000 MW of natural gas generation capacity planned for construction over the next decade.

Natural gas-fired peaking units are proven to generate safe and reliable power in a cost-effective manner. The goal of a peaking unit is not to run all the time, but to be available to run on short notice to provide energy and capacity during periods of critical peak demand in the winter and summer. The technology can also respond quickly to supplement intermittent generation from wind and solar. At the same time, natural gas-fired peaking generation helps reduce carbon and prepare for developing technologies. Natural gas is the cleanest of the fossil fuels (about 50% cleaner than coal), producing the least emissions of carbon dioxide, sulfur dioxide, nitrogen oxides, and particulate matter. New combustion turbines may also be capable of burning a blend of fuel and hydrogen, a developing zero-carbon technology that may become commercially available in the future.

As the demand for electricity continues to grow across our Member-owners’ service areas, we believe additional peaking generation will be a necessary component of our “all of the above” strategy. In our view, renewables and natural gas generation must co-exist to protect reliability and can do so efficiently and responsibly. 

Our Member-owners expect and deserve safe, reliable, and affordable power supply. It is through that lens we will evaluate resource options and plan for the needs of the cooperative.