Lower gas prices edge coal out of SPP market
Argus takes a look at the generation mix in the SPP market and finds falling natural gas prices are already edging coal out – and that’s before new carbon regulations come into play, likely forcing a significant restructuring.
According to Argus, coal generation in the Southwestern grid averaged 16,568 MW in a nine-stare area. It’s share was still 59%, but that was down from 63% a year before. Natural gas reached 21% of the supply, up from 17%.
Looking ahead to CPP compliance, the Southwest grid operator is considering two scenarios, but they each call for significant new investments in natural gas. Under one, SPP would bring 15.3 GW of gas capacity online. In a second scenario, new gas capacity reaches 21 GW.