The United States coal industry is shutting down power plants so fast that the trend looks like the opposite of the “S-curve” often used to track the growth of new technology innovations like solar panels, wind turbines, electric vehicles, or iPhones, according to a report released yesterday by the Institute for Energy Economics and Financial Analysis.
In the four months since March, 2021, “the generating capacity of coal plants slated to retire or convert to gas from 2021 to 2030 has risen by 10 gigawatts (GW), to a total of 80.9 GW—a 116% increase from a year ago in March 2020, when utilities had only 37.4 GW of coal capacity scheduled to close through 2030,” IEEFA reports. That trend adds up to “an inverse S-curve”, as utilities and independent power producers “adjust to the influx of cleaner and cheaper wind, solar, and battery storage resources disrupting the electric system.”
IEEFA cites two U.S. utility giants, Michigan-based Consumers Energy and the Tennessee Valley Authority, as examples of the sudden shift.
Consumers “now proposes to be coal-free by 2025,” 15 years ahead of its previous schedule, IEEFA says. “Importantly, the new, faster phaseout is also cheaper,” the release notes, citing the company’s latest regulatory filing. “Retiring its coal units in 2025 and ramping up its renewable capacity will save Consumers US$650 million through 2040, compared to the earlier plan.”
Instead of building new gas-fired power plants, IEEFA adds, the Michigan utility is buying four existing plants that will at least phase out sooner, the largest of them by 2040.
TVA, meanwhile, has set a 2035 deadline to shut down the 6.9 GW of coal capacity it operates for customers in Tennessee and six surrounding states. IEEFA says three of those plants are already more than 60 years old.
“TVA’s recent evaluation confirms that the aging coal fleet is among the oldest in the nation and is experiencing deterioration of material condition and performance challenges,” the utility said in a recent announcement. “The performance challenges are projected to increase because of the coal fleet’s advancing age and the difficulty of adapting the fleet’s generation within the changing generation profile; and, in general, because the coal fleet is contributing to environmental, economic, and reliability risks.”
While TVA isn’t moving as fast as Consumers, “there is little question about the final outcome,” IEEFA writes. “The question is not if the coal plants will close, but rather when they will close.”