Red-State Utilities Go Green

Utilities are moving away from coal & toward renewables, even in GOP states.

Even in Republican states, there has been a regulatory movement to expand the use of renewables. (see this report for more.) Perhaps even more surprisingly, some utilities and generating companies that now use a lot of coal are voluntarily turning to renewables. Here are some recent examples:

Ohio. In February, AEP explained that “Our customers want us to partner with them to provide cleaner energy and new technologies, while continuing to provide reliable, affordable energy. Our investors want us to protect their investment in our company, deliver attractive returns and manage climate-related risk. This long-term strategy allows us to do both.” The firm plans to add 3,065 MW of solar generation and 5,295 MW of wind to its portfolio for regulated customers in various states by 2030.

Indiana.  Vectren has announced plans to close three coal plants, totally almost 600 MW, to be replaced with a combination of a new national gas plant and solar power.

Texas. Vistra Energy announced that it plans to retire three coal-fired plants with a combined capacity of over 4000 MW. In addition, In addition San Antonio’s municipal utility CPS Energy will close a 840 MW plant by the end of the year.

Florida. Last September, Florida Power & Light announced it would close its last coal plant in the state. It also announced that it four new solar plants would go into service in March, with a total capacity of 600 MW, on top of three plants that started service this January.

Michigan. Consumers Energy recently announced that it will phase out coal by 2040 and generate 40% of its power from renewable sources such as wind and solar energy by then. According to the CEO, “We believe that climate change is real and we can do our part by reducing our greenhouse gas emissions, and we also believe it doesn’t have to cost more to do it. We believe we’re going to be on the right side of history on this issue.” Last spring, DTE Energy, Michigan’s largest electricity supplier, announced plans to transform its power generation — an 80% reduction in carbon emissions and the shuttering of all of its coal-fired power plants by 2050.

What’s going on here? One big driver is clearly economic. Texas has moved farther than any other state in deregulating electricity markets. Generators there can’t afford to keep inefficient, old coal-fired plants in operation. Natural gas and renewables have just gotten too cheap to resist. Other utilities may be trying to prepare for future requirements from state and federal regulators. And finally, they may be responding to customer demand for cleaner energy.

It’s little wonder that the Energy Information Agency (EIA) projects continuing declines to coal-fired generation through 2030, even without the Clean Power Plan or decreases in the price of natural gas. By 2035, the EIA projects that renewable energy will be a bigger source of power than coal.

Whatever the causes, these trends seem very positive. Like King Canute, Trump may stand at the shore and demand that the tide stop coming in. But he may have little power to stop the decline of coal or the rise of renewables, any more than he can stop the tide.

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Reader Comments

2 Replies to “Red-State Utilities Go Green”

  1. “…..Natural gas and renewables have just gotten too cheap to resist…..”

    Natural gas power generation is cheaper and much more reliable than solar and wind energy. Natural gas is so abundant that it could be considered a “renewable.” Good clean burning natural gas is by far the best choice for new power production. We love natural gas.

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About Dan

Dan Farber has written and taught on environmental and constitutional law as well as about contracts, jurisprudence and legislation. Currently at Berkeley Law, he has al…

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