President Donald Trump is protecting the coal industry from market forces, driving up utility bills for Americans.
On energy policy, the administration’s most obvious sin has been picking losers. It has attempted to halt construction for offshore wind developments, even some that were nearly complete, and suffocated massive solar projects with red tape. As the nation clamors for more electricity, this oppositional attitude makes no policy sense.
Less covered, but equally concerning, is the administration’s penchant for picking winners. The Energy Department quietly issued emergency orders in late December requiring four coal plants to keep operating that had been scheduled to retire. That was in addition to another plant in Michigan that the administration has forced to remain open since last May. Energy Secretary Chris Wright has indicated he intends to do the same for additional plants.
The administration argues that these are needed to prevent power outages and that Democrats have only sought to close them for political reasons, but closures require intensive evaluations to ensure local grids can cope without their contributions. And while many blue states have displayed hostility toward coal, because its production emits more pollution than any other energy source, the real threat to coal producers over the past decade has been economics.
Despite growing demand for power, no new coal plants are under construction in the United States today. In fact, the last large coal-fired plant built in the U.S. came online in 2013. This is because other forms of energy, especially natural gas, are cheaper. Coal plants are less efficient — wasting roughly two-thirds of their energy through heat — and take hours longer to fire up than other facilities.
The aging facilities that were scheduled for retirement are in disrepair and require expensive investments to keep operating safely. The Michigan plant the administration forced to stay open went offline for long stretches last year for maintenance.
The plant’s operator, Consumers Energy, told regulators in November that running past its scheduled retirement had cost $80 million since May, more than $615,000 per day. And who picks up that tab? Residents, in the form of higher electricity bills. Ratepayers nationally will take on as much as $6 billion in higher costs by 2028 if this pattern continues, according to analysis last year by the consulting firm Grid Strategies.
Washington state carefully planned the closure of its last coal plant for more than a decade, granting its operator exemptions from emissions regulations during its final years in exchange for an investment of $55 million to help employees find new work, including a $50,000 parting bonus. Those payments went out, yet the plant must now keep running because of the federal government’s edict.
This is what it looks like when ideology drives energy policy. Keeping money-losing plants online skews the market, making it harder for companies to invest in the infrastructure of the future.
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