In 2023, the United States witnessed a notable surge in natural gas consumption, reaching an unprecedented high of 89.1 billion cubic feet per day (bcfd), as per data released by the US Energy Information Administration (EIA). This figure reflects an annual average increase of 4% since 2018.
Throughout the course of 2023, monthly consumption records were consistently shattered from March to November. The primary driving force behind this surge was the escalating demand for natural gas in the electricity generation sector. This demand surge filled the void left by the diminishing capacity of coal-fired power plants, as highlighted by the EIA.
Notably, in 2023, natural gas consumption in the residential sector experienced a decline of 10%, registering at 12.3 bcfd compared to 2022. Similarly, the commercial sector witnessed a 6% decrease, amounting to 0.5 bcfd. Conversely, consumption in the industrial sector remained stable at 23.4 bcfd. However, the most significant uptick in natural gas usage across various economic sectors in 2023 occurred in the electric power sector, with a notable 7% increase equating to 2.2 bcfd. This surge propelled consumption to a record high of 35.4 bcfd, up from 33.2 bcfd in 2022.
Throughout the year, the electric power sector experienced significant spikes in natural gas consumption during July and August, surpassing the levels observed in the same months of 2022, despite relatively cooler temperatures. Specifically, natural gas consumption in the electric power sector, which typically surges in July and August to meet air-conditioning demands, escalated by 6% compared to 2022, setting monthly records of 47.5 bcfd in July and 47.2 bcfd in August.
The retirement of US coal production units, driven by the aging coal fleet and the transition to generators utilizing natural gas and renewables, has been a notable trend. Although natural gas-fired power generation surged by 6% in July and August of 2023 compared to the previous year, overall electricity growth remained stagnant in July and rose modestly by 3% in August, according to the EIA.
The peak natural gas consumption in the US during any month of 2023 occurred in January, reaching 106.6 bcfd, albeit marking an 8% decline compared to January 2022. This decline was attributed to warmer-than-average temperatures, which curtailed natural gas consumption in the residential and commercial sectors aimed at meeting space-heating demands.