Now that market dynamic is bad enough for the energy industry to deal with, but it's how the market works. These people can handle it. But when you toss in the EPA, it screws everything up.Existing commodity price dynamics make natural gas the "safest play," for building a new power plant. However, overbuilding gas-fired infrastructure could set the stage for considerable gas price increases over the longer term.
In the US, gas is clearly the most-favorable option given existing economic, political and environmental conditions and that is exactly where the danger lies.
Mohler explained that betting on gas does not remove volatility from the equation over the long term and utility customers do not want their bills to fluctuate wildly. The potential for gas overbuild is a concern for Duke, which says it attempts to maintain a balanced generation portfolio and views any individual component rising above 30% of its total fuel mix as potentially problematic. The main concern for Duke - and many other US utilities - is making decisions based on current commodity prices and economics that risk unbalancing their generation portfolios. Over the longer term, changing dynamics and commodity price fluctuations, including more expensive gas, would hurt the utility and its customers.
Coal, Nuclear And Natural Gas: What Will Keep The Lights On?
In reality, the effect on energy prices for the consumer is being muted, for the time being at least, by natural gas...but the Obama administration is the prime thorn in the side for the coal industry and is the cause of the job losses. Not poor business practices.Undue Burden
Among the power companies challenging the rule were Southern, EME Homer City Generation LP, a unit of Edison International, and Energy Future Holdings Corp. units in Texas. The state of Texas and the National Mining Association joined in parallel cases, saying the rule, which was issued last year, would put an undue financial burden on power producers and threaten electricity reliability. The cases were consolidated by the court.
For Republican lawmakers, who have accused President Barack Obama’s EPA for waging a “war on coal,” the ruling was welcomed as a much-needed reprieve.
The cross-state rule “is just one of several new EPA rules targeting America’s power sector that together will cost our economy tens of billions of dollars and put thousands of jobs at risk,” Fred Upton, the Michigan Republican chairman of the House Energy and Commerce Committee, said in a statement. “The EPA is an agency out of control.”
The EPA also proposed rules for greenhouse gases from power plants, a regulation that power companies warn will preclude the construction of new coal-fired power plants.