Economy, weather, and CO₂

U.S. macroeconomics
To generate the macroeconomic assumptions in the Short-Term Energy Outlook (STEO), we input STEO energy price forecasts into S&P Global’s Short-Term U.S. Macroeconomic Model to produce a conditional macroeconomic forecast. For more details on the macroeconomic model, see our documentation.

Emissions
We forecast U.S. energy-related carbon dioxide (CO2) emissions to decrease by 2.4% in 2026 relative to 2025 and to increase by a 0.3% in 2027 relative to 2026. In 2026, decreases in CO2 emissions are due primarily to expected declines in coal consumption, most of which occur at power plants for electricity generation. Declines in coal-fired generation and coal-related emissions are expected to continue in 2027 but are offset by growth in natural gas-fired generation, resulting in a modest increase in total CO2 emissions.

Weather
The United States averaged 404 heating degree days (HDDs) in March, 24% fewer HDDs than the 10-year monthly average, largely offsetting the colder-than-normal weather throughout the United States toward the end of January. Consequently, the United States ended the 2025–2026 winter heating season (November–March) with 3% fewer HDDs than both last winter and the 10-year winter average. Based on our current forecasts and data from the National Oceanic and Atmospheric Administration, we expect the United States will average about 1,610 cooling degree days (CDDs) in 2026, 4% more CDDs than in 2025, as warmer weather in 3Q26 (8% more CDDs than 3Q25) rises above seasonal averages (5% more CDDs than the 10-year quarterly average).