Coal-to-Gas Replacements and the Economics Behind United States Steam Retirements

Coal units in the United States rarely retire only because a speech demanded it. They retire when competing gas combined-cycle energy, rising compliance costs, and poor capacity factors make continued operation a losing proposition. EIA's 20 February 2024 survey showed operators planning to retire 5.2 gigawatts of capacity in 2024, a 62 percent decrease from 13.5 gigawatts retired the prior year and the least since 2008. Coal and natural gas jointly accounted for 91 percent of planned exits.

The largest coal retirements scheduled for 2024 were Seminole Unit 1 at 626.0 megawatts in Florida and Homer City Unit 1 at 626.1 megawatts in Pennsylvania. Gas retirements of 2.4 gigawatts included Mystic Generating Station at 1,413 megawatts in Massachusetts and 754.0 megawatts of simple-cycle turbines at TVA Johnsonville. Some owners replace coal with gas on related sites, preserving transmission connectivity and staffing pathways while cutting emissions intensity and improving heat rates. Others exit without in-kind firm replacement, relying on market purchases and renewable additions. A coal exit that arrives before the gas block, storage, or transmission upgrade is a reserve-margin hole.