Electricity, coal, and renewables

Electricity generation
After cold weather in December, followed by Winter Storm Fern in the latter half of January, we expect electricity generation to total 1,072 billion kilowatthours (BKWh) in the winter months of December, January, and February, slightly exceeding electricity generation of 1,063 BKWh in the same period of 2024‒2025.

We expect 2% (3 BKWh) less coal generation from December through February, compared with the same period a year ago. During the same period, we expect 1% (6 BKWh) less electricity to be generated by natural gas because of high natural gas prices. Wind, hydropower, and solar also provide more generation this winter compared with last winter. Dispatchable generation—nuclear, coal, natural gas, and even petroleum—will continue to supply electric energy during periods of peak demand, as seen during Winter Storm Fern.

Higher electricity demand drives increases in annual U.S. electricity generation throughout 2026 and 2027, particularly in the parts of the grid managed by the Electric Reliability Council of Texas (ERCOT) and by the PJM Interconnection, where data center growth and capacity additions are concentrated. We expect total U.S. electricity generation to increase 1.4% in 2026 and 2.5% in 2027, after growing by 2.7% in 2025.

Much of the growth in demand will be met by growth in generation from renewable sources of energy. We expect utility-scale solar generation to be a leading source of growth in electricity generation, rising by 17% in 2026 and by a further 23% in 2027. We also expect wind generation to rise 6% in 2026 and 7% in 2027. The growth in renewable generation comes as 69 gigawatts (GW) of solar capacity and 19 GW of wind capacity get connected to the grid in 2026 and 2027. Hydro generation is also expected to rise 3% in both 2026 and 2027 after historically dry summers in 2024 and 2025. We have updated our model to account for more recent information about typical renewable energy capacity factors, which has contributed to a slight decline in our growth forecasts for solar and wind compared with our last STEO.

We expect natural gas generation to be nearly flat in 2026 and rise by 1% in 2027, while coal generation falls by 6% in 2026 and by 4% in 2027, as some coal plants retire or remain idle while still connected to the grid. We don’t expect coal generation to fall as much in the forecast as we did in the last STEO because of an increase in our forecast prices for natural gas.

Coal markets
The U.S. coal fleet increased generation during January to meet peak demand during Winter Storm Fern. We estimate that coal consumption totaled 46 million short tons (MMst) in January, 4 MMst more than we expected in the January STEO. Electric power consumption accounts for about 90% of total coal consumption and totaled 43 MMst in January. Coal consumption increased in all four census regions, with the largest increases occurring in the South and the Midwest when compared with December 2025 levels. In addition to increasing consumption, January’s cold temperatures lowered coal production. We are now forecasting coal production to total 46 MMst in January, 3 MMSt less than we forecast last month. More consumption combined with lower production caused a drop in coal stockpiles compared with our January STEO.

We expect U.S. coal consumption in the electric power sector to total 391 MMst in 2026, 15 MMst higher than the January STEO, but a 7% year-on-year decline. In addition to the strong demand in January, we expect more coal consumption this year than we did last month because natural gas prices are expected to be higher than we forecast last month for much of 2026. We anticipate total consumption to decline further to 375 MMst in 2027.

We expect declines in electric power sector coal consumption for most regions across all quarters of 2026 and into 2027. As temperatures moderate following January’s cold snap, coal consumption in the first quarter of 2026 (1Q26) will total 105 MMst, about 4% lower than 1Q25. The largest decrease in consumption will occur in 2Q26 as milder weather lowers electric power demand and as natural gas prices decline from winter highs. Total coal consumption in 2Q26 is expected to be 81 MMst, a 10% decline compared with 2Q25.

Because we raised our forecast for coal consumption, we also raised our forecast for coal production this year. U.S. coal production in our forecast totals 520 MMst in 2026, 13 MMst higher than we expected in our January forecast but down 2.5% from 2025. This follows an annual increase in coal production from 513 MMst in 2024 to 533 MMst in 2025. In 2027, we expect production to decline 4% to 501 MMst.