It appears natural gas prices bottomed at $1.91 per thousand
cubic feet (Mcf) on April 19th. A surprising rally began that
carried prices to $2.74/Mcf by late May. The rally was driven
largely by expectations for natural gas to continue growing its
share of the power generation market from coal-fired plants. Low
natural gas prices have made it easier for electric power
generators to use their gas-fired plants instead of coal-fired
ones, not only because the cost of the fuel was lower but also
because gas plants produce fewer greenhouse gas emissions. At
various meetings, power company executives have been quoted
saying that they have been using their gas-fired peaking power
plants for base load electricity generation due to the lower
cost of the fuel. As a result, according to the Energy
Information Administration (EIA), the share of power generated
by burning coal recently fell to 34%, the lowest of any month
since 1973. The peak share of coal-fired power generation
occurred in 1985 and remained high for mos