Natural gas prices across the Southwest tell a story no courtroom can dispute.
Gas futures have remained below $3 per million BTU through August, settling at $2.69 in the day-ahead market as of early October. In Nevada and Arizona, prices slumped through much of the spring amid stout supply before summer heat pushed them back up, not because of any policy intervention but because demand rose and the market responded.
Cycles like this are basic economics, learned in classrooms nationwide. As prices rise, producers respond, and prices fall again.
That basic principle is worth stating because a lawsuit working its way through Texas courts rests on the proposition that markets do not actually respond to economic forces, and that coal’s decline is better explained by coordinated investor mischief than by the laws of supply and demand.
Attorneys general from Texas and a dozen other states alleged that major asset managers used minority equity stakes in coal producers to suppress output and drive up energy prices. However, coal’s trajectory is readily explained by forces that have reshaped American power markets for years. Coal-fired power generation fell 10 percent in the first half of 2026, and it is expected to decline further into 2027 as natural gas gains.
The administration has tried reviving the coal market to no avail. The Interior Department has opened 13.1 million acres of federal land to coal leasing and lowered royalty rates, and the Department of Energy says its actions have saved or supported 45 coal plants and more than 40 gigawatts of capacity. Despite these extraordinary measures, the EIA projects power plants to burn 38 million fewer tons of coal this year, followed by another decline in 2027.
That’s because utilities respond to the relative cost and availability of generation, not political preferences or policy choices. When gas is cheap and plentiful, they run gas plants. Fortunately, Permian Basin output is running 6 percent ahead of last year. Each new oil well drilled in Texas and New Mexico pulls associated gas to the surface, adding supply to an already well-stocked market.
For consumers in the Southwest, competitive natural gas markets have kept electricity costs lower than they would otherwise be. The question for energy policy in the region is how to ensure pipelines, takeaway capacity and the grid investments let abundant supply reach the households that need it, not how to override what is working.
Markets are signaling, loudly and clearly, that natural gas has become the dominant fuel for American power generation. Those signals are real information about supply, cost and where investment is flowing and why. A lawsuit that asks courts to attribute that outcome to investor coordination rather than to market forces does not protect the Southwest’s energy consumers. It protects a preferred political explanation at their expense.
A deeper problem remains, too. Index funds are not operators. They passively hold minority stakes in thousands of companies, which means they do not control how those companies run their businesses. Treating this ownership model as a basis for antitrust liability would extend the law far beyond anything it was designed to reach. The issue does not start and end with energy. If holding shares in an unpopular industry exposes an investment manager to antitrust claims, the effects ripple into every diversified retirement account in the country.
Policymakers should ask what it takes to ensure competitive energy markets continue to serve families in New Mexico, Arizona and Texas. For starters, they should invest in the transmission and pipeline capacity that moves abundant supply to where demand is highest and support regulatory frameworks that let new generation, no matter the type, come online when the market calls for it. Most importantly, they should take price signals seriously, rather than treating them as evidence of a wrongdoing.
The story was pre-written as the rise in natural gas meant the inevitable fall of coal. Prices fell, consumers benefited and the markets worked. No harm. No foul.