Coal and Natural Gas are the primary feedstocks for electric power generation in the U.S. But the other power sources are always dispatched first (generally speaking). So coal and gas can only compete for the remainder of power generation demand after renewables (including hydro) and nuclear are fully utilized.
And in the absence of power generation demand growth, a condition that has prevailed in recent years, this is a simple cage fight between the two resources.
Here are their relative shares of that 'addressable market' for the last three years, through October 2013, per the EIA. They were briefly at parity in April 2012, and gas has been ceding back territory to coal as gas prices have risen. That isn't a trend that is expected to continue, but this does illustrate that the basic laws of economics and elasticity will always be an important factor in projecting future gas demand.
There are some other factors that explain part of the monthly variations below, but generally it reminds us that coal is always waiting as an affordable alternative to gas fired power generation.
