Coal Plays Key Role in Shielding Americans from Energy Price Spikes

New analysis shows coal generation surge saved consumers $30-$40 billion in 2025 as natural gas prices climbed.

Published on Mar. 2, 2026

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A new report by Energy Ventures Analysis found that increased coal generation in 2025, up around 12% year-over-year, provided $30 to $40 billion in savings for American consumers as natural gas prices delivered to power plants climbed more than 26%. The analysis showed that if coal output had been constrained, natural gas generation would have had to increase, putting more pressure on gas markets and leading to higher power-sector costs that would have been passed on to households and businesses. The report highlights coal's role as a "price shock absorber" that can ramp up when demand spikes and natural gas prices rise, helping to keep electricity and natural gas bills affordable for consumers.

Why it matters

Fuel diversity and the ability to switch between different power generation sources is crucial for maintaining grid reliability and electricity affordability, especially as electricity demand continues to grow. With natural gas prices expected to keep rising, preserving the availability of the coal fleet will be more important than ever in protecting household budgets and supporting industrial competitiveness.

The details

The EVA analysis found that increased coal generation in 2025 produced $30 to $40 billion in consumer savings compared to scenarios where coal output was more constrained. This translated to average annual residential electricity and natural gas bills being $100 to $150 lower per household than they would have been without the coal generation surge. The report also highlighted coal's performance during Winter Storm Fern in January 2026, when coal generation in the lower 48 states increased 31% in one week to become the second-largest source of electricity on the grid behind natural gas.

  • In 2025, U.S. coal generation increased approximately 12% year over year, about 80 terawatt-hours.
  • In the week ending January 25, 2026, during Winter Storm Fern, coal generation in the lower 48 states increased 31% from the prior week.

The players

Energy Ventures Analysis (EVA)

A firm that prepared a report analyzing the economic impacts of increased coal generation in 2025.

Chris Wright

Energy Secretary who described coal as the "MVP" during Winter Storm Fern in January 2026.

U.S. Energy Information Administration (EIA)

The federal agency that reported on the increase in coal generation during Winter Storm Fern and noted the largest single-week natural gas storage withdrawal on record.

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What’s next

With power demand growing and natural gas prices for 2026 and 2027 expected to continue to rise, coal generation as a price shock absorber will be more important than ever. Preserving the availability of the coal fleet and the fuel optionality it provides will be crucial for protecting consumer budgets and supporting industrial competitiveness.

The takeaway

Coal's ability to ramp up generation and act as a price buffer against natural gas price volatility saved American consumers billions of dollars in 2025 and proved critical during extreme weather events like Winter Storm Fern. Maintaining a diverse, dispatchable power generation fleet that includes coal is essential for ensuring reliable and affordable electricity for households and businesses.