We are reaffirming our fair value estimates and moat ratings for all U.S. utilities after updating our 2020-30 U.S. power generation forecast. Our forecast shows natural gas generation expanding its leading share in the U.S. power generation market through 2030. But our forecast also shows renewable energy moving into second place, overtaking coal, nuclear, and hydropower generation.
We think this sets up a battle for market share by the end of the next decade: natural gas versus renewable energy. Renewable energy has policy momentum, and its costs are now competitive with natural gas generation even at today’s low gas prices and without tax subsidies. But gas generators offer grid reliability, a key competitive advantage.
To view this article, become a Morningstar Basic member.
Travis Miller does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.