Coal Is Rising Along with Solar in the U.S. Power System, While Gas Loses a Step

Coal and utility-scale solar power each gained market share in the first half of this year, newly released data on U.S. electricity generation show.

Natural gas, while still the market leader, lost some share.

So what’s going on?

The increase for coal and decrease for gas can be largely attributed to the prices of each fuel, according to analysts. The rising cost of natural gas has made coal the more affordable option for some power plant owners.

Meanwhile, the Trump administration’s efforts to prevent the closure of old coal plants were too recent to have much of an effect on national data.

The gains for utility-scale solar were predictable, considering the large number of solar projects that are coming online.

From January to June of this year, U.S. power plants generated 2.1 million gigawatt-hours of utility-scale resources, representing a 2.9 percent increase from the same period in 2024, according to the Energy Information Administration. Here is the mix of resources behind the total:

The big movers were natural gas, which lost 2.7 percentage points of market share, and coal, which gained 2 percentage points.

Renewables gained 1.5 percentage points, which was almost entirely attributable to utility-scale solar. Wind and hydropower, the other leading sources of renewable energy, were essentially flat.

The main driver of coal’s increase and gas’ decrease is that the U.S. benchmark price of natural gas was up substantially in the first half of the year compared to the first half of last year, said Michael Goggin, vice president of Grid Strategies, a consulting firm.

“Plant owners are very sensitive to those price differences in the fuels,” he said. “If it’s a little bit cheaper to run coal as gas prices get higher, then utilities and other power plant operators are going to do that.”

Another important factor is the continuing increase in U.S. electricity demand from data centers and other large users, which was met by an increase in supply.

While an increase of 2.9 percent may not seem like a lot, it’s a pretty big shift following two decades in which there was little change in net generation, with average annual growth of less than 1 percent.

This projected period of rapid growth for the electric sector is good for just about anybody who owns a power plant. Investors are spending heavily on natural gas power plants, wind, solar and batteries, based on data for plants in development.

But they’re not building new coal-fired plants. The most recent large coal plant to come online was Sandy Creek Energy Station in Texas in 2013, with summer capacity of 932.6 megawatts. The most recent coal plant of any size was a 17-megawatt system that went online in 2020 at the University of Alaska Fairbanks.

Even with the support of the Trump administration, the country’s coal plants are mostly old and expensive to operate.

“There’s an inexorable long-term trend that gas and renewables are replacing coal generation,” Goggin said.

This recent increase in coal power’s market share is not a sign of a bright future for the technology, said Brendan Pierpont, director of electricity modeling for the think tank Energy Innovation.

“Short-run fluctuations aren’t stopping the long-run decline,” he said, pointing to several factors, including the fact that plants become more expensive to operate as they age.

In the meantime, it is interesting to see where coal had the greatest gains this year. Indiana and Michigan are among the states that stand out for having large increases in coal-fired power.

Michigan is home to the J.H. Campbell plant, which was scheduled to close in May but is staying open because of a Trump administration order that says the plant is needed to maintain grid reliability. Michigan utilities were already increasing their use of coal power due to market forces such as gas prices, even before the administration’s order.

The order had minimal effect on this batch of data, since the plant was only operating in one month, June, when it otherwise would have been closed.

Goggin analyzed this order in a report sponsored by environmental advocacy groups. He found that if the administration uses emergency declarations to stop coal plants from closing over the remainder of President Donald Trump’s term, the positive effects on reliability would be minimal and the costs to consumers would increase by $3.1 billion to $5.9 billion per year.

Utility-scale solar is rising almost everywhere in the United States. California has long been the leader in generation from utility-scale solar, but Texas has now moved into a virtual tie, with California ahead by less than 0.1 percent. Texas is on a pace to become the leader, and it may clearly have that status within a month or two.

Ohio, Illinois and Indiana stand out for having doubled their electricity generation from utility-scale solar generation in the first half of this year compared to the first half of last year. Those states now rank ninth, 10th and 11th, respectively, in the United States for generation from utility-scale solar.

While I’m focusing on utility-scale solar, small-scale solar has also grown. The Energy Information Administration defines small-scale solar as any project with capacity of 1 megawatt or less, which mainly includes rooftop systems owned by consumers. These systems generated 47,025 gigawatt-hours in the first half of the year, which, for perspective, was about one-third of the generation from utility-scale solar.

It can be challenging to talk about small-scale solar in the context of national totals because these small projects are not utility-scale resources, so they don’t have a slice of the donut in the first graphic above.

But rooftop solar and other customer-owned resources are important for the way they reduce demand for power plants on the grid. Each kilowatt-hour a customer generates for themselves is one that a centralized power plant doesn’t need to produce.

When asked for big-picture observations about this data, Pierpont noted that the market share for fossil fuels is on a long-term downward trend that has continued this year. That share was 55.9 percent in the first half of this year (including coal, gas and fuels with tiny shares, such as petroleum liquids), down 0.6 of a percentage point from the first half of last year.

Much of the movement in the last six months was driven by coal trading market share with natural gas, but the long-term trend is the rise of renewables and the decline of fossil fuels, he said. 

“Looking forward, solar is a big share of the projects expected to be built in the remainder of this year and next year, and over the long run it will continue to be a low cost way of meeting growing demand that helps protect customers from the volatility in coal and gas costs—so I expect it to continue to eat into market share from coal and gas,” he said.

I’ll add a caveat: The Trump administration could succeed, at least in the short term, in slowing this long-term trend. But that’s more of a blip than a fundamental change in direction.

Other stories about the energy transition to take note of this week:

White House Launches Multi-Pronged Attack on Offshore Wind: The Trump administration has instructed six agencies to develop plans to stifle development of offshore wind energy, as Maxine Joselow, Lisa Friedman and Brad Plumer report for The New York Times. This highly unusual effort is being led by Susie Wiles, the White House chief of staff, and Steve Miller, the deputy chief of staff. It includes investigations into potential negative effects of offshore wind on human health and national defense, and is the latest in a series of actions opposing this renewable energy technology.

Trump-Voting Fishermen Are Outraged at Revolution Wind Halt: The Trump administration’s order to stop construction on Revolution Wind off the coast of Rhode Island is earning a rebuke from fishermen who voted for Trump and now are working in collaboration with the offshore wind developer, as Clare Fieseler reports for Canary Media. The fishermen are some of the hundreds of workers who were laid off with the halt of the project, which was 80 percent complete.

Trump’s EV Charging Plan Focuses on Gas Stations: The National Electric Vehicle Infrastructure program is going to get back to paying for charging stations again, following a legal battle in which the Trump administration was unsuccessful in its attempt to defund the initiative. But the program will shift its priorities a bit, emphasizing charging stations at gas stations and truck stops where the owner of the charging station would also own the land, as opposed to shopping center parking lots, as David Ferris reports for E&E News. Tesla and Rivian have said they dislike these rules because those companies tend to build in places where they don’t own the land.

A Gigantic Solar Park Gets Even Larger: A solar development in the United Arab Emirates, already described by its owner as the largest in the world, is about to get an additional 1 gigawatt of capacity, as Patrick Jowett reports for PV Magazine. Mohammed bin Rashid Al Maktoum Solar Park already has 3.8 gigawatts of capacity. This new expansion, plus previously announced additions, would bring the total to 7.2 gigawatts. I should note that it’s a moving target for any project to claim to be the largest in the world, and some of this designation depends on whether we’re talking about a single-site project or one that spans multiple sites. But this project is gigantic by any standard, and much larger than anything in the United States, where the largest solar developments are in the range of 1 gigawatt.

Inside Clean Energy is ICN’s weekly bulletin of news and analysis about the energy transition. Send news tips and questions to [email protected].