Summer 2025 wrap-up: gas generation falls despite higher power loads

As the peak cooling season comes to an end, new data shows that US gas-fired power generation remained lower  year on year, even as total electricity demand increased. Despite relatively average summer temperatures, gas usage in the power sector failed to match last year’s record highs. This reflects ongoing shifts in fuel economics and capacity additions that are likely to continue into autumn.

The facts

• Since the beginning of 2025 and through August, gas power demand has remained lower compared to the same period in 2024, even though overall electricity use has grown.
• From June to August, preliminary data shows gas-fired generation averaged 43.7 billion cubic feet per day (bcfd), which is around 2 bcfd or 4 percent lower than in 2024. It is also slightly below 2023 levels.
• Summer temperatures were near normal, with cooling degree days (CDDs) tracking between the 10- and 30-year historical averages.

Our view

This decline in gas-fired generation is in line with expectations and reflects several interrelated market drivers.

Natural gas prices remained elevated: This summer, NYMEX Henry Hub prices averaged 36 percent higher than in 2024. These higher costs made gas less competitive, prompting many generators to reduce gas burn and switch to coal where available.

Coal and renewables continued to gain market share: Coal-fired power plants saw year-on-year gains, particularly where gas prices made coal a more economical option. At the same time, capacity additions continued to strengthen renewable generation, with solar in particular playing a bigger role in meeting peak daytime loads.

Summer weather: Record heat, which seems to have been commonplace in recent summers, was largely avoided in 2025 as temperatures overall averaged below the hotter, 10-year normal metric. In fact, L48 population-weighted cooling degree days during the June to August summer period were the lowest since 2015.

Looking ahead

With summer now behind us, electricity demand will begin its seasonal decline. The autumn shoulder period usually brings lower load and increased fuel switching as generators respond to changing market conditions. Unless gas prices fall or weather drives higher demand, gas-fired generation is likely to remain under pressure and face strong competition from coal and renewables.

This summer’s trends, including higher gas prices, coal’s resilience supported by policy, and growing renewable output, set the tone for the months ahead. As the generation mix continues to change even as overall load increases, gas will need to adapt to a more competitive and cost-conscious environment.

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