The United States Energy Information Administration (EIA) forecasts record-high natural gas consumption in the U.S. for electricity generation in July and August as another hot summer increases demand for air conditioning.

In its July "Short-Term Energy Outlook" (STEO), EIA expects about 4% more U.S. electricity generation from natural gas in July and August 2023 than in the same months of 2022.

Natural gas will provide about 46% of U.S. electricity for those two months and provide 41% of U.S. electricity for the year, according to EIA’s forecast. EIA also expects a 6% increase in electricity generation from renewables and a 2% increase in generation from nuclear energy in July and August 2023 compared with 2022.


"This is an interesting time to monitor the United States' electricity mix. As coal provides less and less power to the grid, we expect the contributions of natural gas and renewables in particular to increase," said EIA Administrator Joe DeCarolis.

Natural gas prices remain relatively low compared with last year, and about 6,000 megawatts of new combined-cycle natural gas turbine capacity has come online in 2023, making electricity generation from natural gas more economical than it has been in the past. U.S. operators have also added nearly 15,000 megawatts of capacity from wind and solar so far this year.

Also in the STEO, EIA reduced its forecast for growth in U.S. renewable diesel production from previous forecasts. EIA expects the United States to produce about 161,000 barrels per day of renewable diesel in 2023, which is a 66% increase from 2022. EIA expects a further 36% production increase in 2024.

"We still expect significant growth in renewable diesel production, but changes to the Renewable Fuel Standard slightly lower the growth rate in the short term," DeCarolis said.

The full July 2023 "Short-Term Energy Outlook" is available on the EIA website. EIA also published a STEO supplement examining the expansion of U.S. liquefied natural gas export capacity.