US gas-fired generation to hold flat this summer before record burn in 2027, EIA says

US gas-fired generation to hold flat this summer before record burn in 2027, EIA says The EIA's May outlook shows rising Permian output building toward a 2027 record for gas-fired power, with this summer's burn roughly flat. The EIA's Short-Term Energy Outlook, published on Wednesday (2026-05-21), projected U.S. marketed natural gas production in the Lower 48 at 117.2 billion cubic feet per day in the first quarter of 2026, a 4% increase from the same period in 2025, while forecasting gas-fired power generation to hold roughly flat through this summer before climbing to a record in 2027.¹ That supply-demand split matters because it shapes the injection season trajectory. Flat power burn against a 3% full-year production increase keeps pressure off NYMEX Henry Hub front-month prices through the summer, even as warmer-than-normal weather pushed prices higher on Monday (2026-05-18) when forecasts showed heat building along both U.S. coasts.^3,1 The production growth is increasingly a two-basin story. The EIA forecast the Permian region will produce 29.2 Bcf/d in 2026, 6% above 2025 levels, and projected a further 10% expansion in 2027 once pipeline constraints ease. Haynesville, the principal gas-directed basin, is expected to add 6% this year and 8% in 2027.¹ These two regions are the main drivers of the forecast 3% rise in full-year Lower 48 production relative to 2025. The 2027 record for gas-fired generation rests partly on LNG export demand pulling molecules away from domestic storage while leaving room for power burn to climb. The EIA highlighted the interaction between U.S. domestic natural gas prices and international markets, with associated gas from rising Permian crude output adding to the supply base as higher crude prices incentivise drilling.⁷ Mixed signals from MISO and ERCOT real-time power markets reflect that setup. Fifty separate market signals are split roughly equally between bullish and bearish directions for near-term gas burn — consistent with a flat summer rather than a decisive swing in either direction. The data center angle is the long-run wildcard. The EIA's Annual Energy Outlook 2026, released on Tuesday (2026-05-19), projected electricity consumed by data center servers will keep rising through 2050, with standalone data centers outpacing all other commercial building categories combined.⁶ If renewable capacity additions fall short of that demand growth, gas-fired peakers absorb the gap — a second support beneath the 2027 record projection. Globally, the IEA's Electricity 2026 report estimated coal's share of the generation mix will erode as renewables, nuclear and natural gas together capture a growing proportion of the power market, with the combined renewables-and-nuclear share forecast to reach 50% of the global mix by 2030.² Gas is projected to expand within that shift. China's recent data complicates that picture. Thermal generation, overwhelmingly coal, rose 1.5% in 2024 to 6.34 trillion kilowatt-hours, according to China's National Bureau of Statistics, defying expectations that coal output was at or near its peak — even as growth slowed to its weakest in nine years outside the pandemic period.⁵ Total Chinese power demand expanded 4.6% the same year. Hydropower surged 10.7% to 1.27 trillion kWh as reservoirs recovered, but those gains were insufficient to cover all of that demand growth without thermal also rising.⁵ Back in the U.S., the near-term signal to watch is whether Enbridge's open season, launched during the week of 2026-05-18, for an Algonquin natural gas transmission expansion into New England attracts enough shipper interest to proceed.⁴ Algonquin constraints produce some of the most extreme basis spikes in the country during cold weather. Shipper appetite — or its absence — will be an early read on how utilities and generators actually view long-run gas demand in a region where state policy is moving in the opposite direction.