Coal vs Natural Gas: Comparing Fossil Fuels

Coal and natural gas are both fossil fuels burned for energy generation around the globe, but they are very different in terms of their efficiency, environmental impact, cost, and availability.

Comparison	Natural Gas	Coal
Efficiency	45-60%	33-40%
Environmental impact	50-60% less than coal	High carbon emissions
Cost	Very affordable in recent history	Historically very cheap, but recently costs are rising
Availability	Widely available, but in some cases requires more infrastructure to extract	Coal reserves are very abundant, but mining is labor intensive

Comparing coal vs natural gas

Efficiency

Coal: Coal plants have a lower efficiency rate, often around 33-40%. This means more fuel is needed to produce the same amount of electricity compared to natural gas.
Natural Gas: Gas plants, especially combined cycle plants, have higher efficiencies, typically ranging from 45-60%. This is because combined-cycle gas plants can capture and reuse waste heat, making them more efficient than coal plants.

Environmental impact

Coal: When burned, coal emits a high level of carbon dioxide (CO₂), sulfur dioxide (SO₂), and particulate matter, contributing heavily to air pollution and greenhouse gas emissions. Additionally, mining coal can damage local ecosystems.
Natural Gas: Although still a fossil fuel, natural gas is cleaner than coal, emitting about 50-60% less CO₂ per unit of energy produced. However, methane leaks during extraction and transportation can still impact the environment, as methane is a potent greenhouse gas.

Cost

Coal: Traditionally, coal was one of the cheapest energy sources, but with the rise of renewable energy and advancements in natural gas extraction (like hydraulic fracturing), coal’s cost advantage has diminished.
Natural Gas: Natural gas has become increasingly affordable, especially in regions like the U.S., due to abundant supply and lower extraction costs. This makes it more economically viable than coal in many areas.

Availability and accessibility

Coal: Coal reserves are abundant globally and are spread across several countries. However, coal mining is labor-intensive and requires extensive infrastructure.
Natural Gas: Natural gas is also widely available, but extraction requires specific infrastructure like pipelines for transport. In some places, natural gas is not as easily accessible as coal.

Transitioning from coal to natural gas

Early to mid-1900s

The history of U.S. fossil fuel energy generation is a long one. For most of the 20th century, coal was the backbone of electricity generation in the United States. Coal’s abundance helped to quickly establish it as the primary fuel for industrialization and widespread adoption of electricity in households across the country. In the first half of the century, natural gas was mainly used for heating. The use of natural gas was limited by the then high costs for extraction and transportation.

Energy and environmental revolution in the 70s and 80s

In the 1970s and 1980s, the oil crisis spurred further interest in alternative fuels. While coal remained the central fuel for electricity generation, investment in the infrastructure for natural gas began to grow rather quickly. Around the same time, increasing awareness and concern regarding global warming and air pollution led to regulations that started to limit emissions from coal. Natural gas has relatively lower emissions compared to coal and became more attractive as an alternative for both heating and electricity generation.

Natural gas starts to dominate coal in the 90s

The development of combined-cycle gas turbines in the 1990s led to significant improvements in the efficiency of natural gas power plants. This helped make natural gas more competitive thanks to reduced costs associated with running the plants. Pipeline infrastructure and anti-coal environmental regulations both continued to expand into the early 2000s. At the same time, grids across the nation began to deregulate and the introduction of market forces, especially in Texas, continued to drive the adoption of natural gas over coal.

Natural gas and renewables working together

From the late 2000s to the 2020s, fracking and drilling saw a massive boom that continued to dramatically decrease cost and increase supply of natural gas. The United States became one of the largest natural gas producers around the globe. Throughout this time, coal plans were retired and decommissioned, while new natural gas plants continued to come online.

In recent years, renewables have become a significant force in the electricity generation sector. Due to the unfortunate volatility and intermittency of renewables, natural gas has remained an important part of the electricity mix. Unlike coal plants, natural gas power plants can be turned on and off rather quickly, which makes them a great partner to renewables when wind and solar go offline.

Written by Graham Lumley

Graham Lumley, Growth Product Manager at BKV Energy, leads digital and traditional marketing strategies, focusing on educating Texans about the state's deregulated energy market. With over 10 years of marketing experience, he creates content to help consumers understand and save on their energy bills, bringing a fresh and dynamic approach to the industry.