The Department of Energy faces a monumental decision this month over the future of a Michigan coal plant. What it decides could forecast how far President Donald Trump is willing to go to save the U.S. coal industry.
DOE used its emergency authority in May to order a Michigan utility to continue operating a 63-year-old coal plant it had planned on retiring. But that order is set to expire Aug. 21, raising questions about whether the Trump administration will issue an extension or allow the plant to retire.
The department has not announced its plans, but industry observers are closely watching its decision for clues on how it could affect other facilities. The J.H. Campbell plant, located in Ottawa County, west of Grand Rapids, is among eight coal plants, three oil plants and two gas plants set to retire this year, according to federal data.
Energy Secretary Chris Wright argues the country can ill afford to let fossil fuel facilities close at a time when electricity demand is growing rapidly. Coal interests have echoed that belief, and they point to federal data showing that two of Campbell’s three turbines were running hard during a June heat wave as evidence the Michigan coal plant is still needed.
“We commend the DOE for prioritizing reliability and taking material steps to enhance the resilience of our grid in tandem with EPA and the entire Administration,” said Michelle Bloodworth, the president of America’s Power, a trade group representing coal interests.
But in using the Federal Power Act to force Campbell to stay open, Wright has set up a legal battle with the administration’s critics, who say he is abusing his emergency powers to further the administration’s political agenda. Section 202(c) of the Federal Power Act gives the Energy secretary broad authority to make power plants run during emergencies.
Michigan’s attorney general filed a lawsuit last month seeking to overturn Wright’s order to keep the Campbell plant open, arguing that it is unnecessary and costly to ratepayers because Campbell’s owner already had lined up new power plants to replace the aging coal facility. They argue DOE’s decisions have saddled consumers with paying for a power plant that is not needed, and worry Campbell could be precursor for more federal intervention.
“My very educated guess is they’re not going to allow a single coal fired power plant to retire during Trump’s term here,” said Tyson Slocum, director of the energy program at Public Citizen, a consumer watchdog group. “This is just throwing red meat to a MAGA base.”
The effort to stave off coal plant retirements dates back to Trump’s first term, when the president made saving coal a focal point of his stump speeches. DOE considered plans to subsidize struggling coal and nuclear facilities, but ultimately abandoned them in the face of criticism from the natural gas industry, environmentalists and voices within the Trump administration.
The inaction left coal exposed to the economic whims of the power market, where the combination of cheap natural gas, low-priced renewables and stagnant electricity demand prompted many utilities to close their aging coal facilities. Almost a fifth of the country’s coal fleet, or about 48 gigawatts of coal capacity, shut down during Trump’s first term.
But the political and economic landscape is different today. Power companies are increasingly reluctant to turn off coal facilities at a time when projections show electricity demand growing rapidly. Utilities retired 4.4 gigawatts of coal capacity last year, the lowest annual retirement figure since 2011, and have plans to close a further 6.6GW of coal capacity this year.
Trump has also shown a willingness to be more aggressive in power markets, declaring a national energy emergency on his first day back in office and following up with an April executive order directing DOE to ensure grid reliability. DOE released a study in response that concluded the U.S. electric system was at increased danger of blackouts if the country did not stem a wave of fossil fuel plant retirements.
“For years, American grid operators have warned decommissioning baseload power sources would jeopardize the reliability of our electric grid,” DOE spokesperson Ben Dietderich wrote in an email. “This administration is committed to ensuring Americans have access to reliable, affordable, and secure energy that isn’t dependent on whether the sun shines or the wind blows.”
He did not answer questions about J.H. Campbell or how DOE intends to use its emergency powers going forward.
‘You don’t run a power plant 90 days at a time’
The circumstances surrounding the retirements planned for this year run the gamut.
In Washington, TransAlta is planning to close its Centralia coal plant as part of a 2011 settlement agreement with the state. It is currently exploring plans to convert the plant’s last operating turbine to gas.
In Colorado, Xcel Energy is planning to close one of the two operating turbines at the Comanche Generating Station outside Pueblo while NiSource is preparing for the complete shutdown of its R.M. Schahfer coal plant in Indiana.
Then there’s Utah.
State lawmakers there passed a law last year requiring the Intermountain Power Project keep its gargantuan coal plant in working order when it powers down later this year. Utah officials are working to find a buyer for the plant, as IPP prepares to bring online a new power plant capable of burning a blend of natural gas and hydrogen, said IPP spokesperson John Ward. He said he was unaware of any contact between the power project and DOE over a 202(c) order extending its usage.
“I think they’re letting the state take the lead,” Ward said.
It is not clear what criteria DOE is using to determine whether a plant should stay open, said Todd Snitchler, president of the Electric Power Supply Association, a trade group. In addition to Campbell, DOE issued an order requiring that the Eddystone gas plant in Pennsylvania continue operating. The department’s moves have complicated the plans of power plant developers seeking to build new facilities, Snitchler said.
“We’re watching with great interest to see what the potential impacts could be because we are clearly in the building phase of trying to meet where demand is going,” he said. “I think investors and shareholders are looking for that reasonable degree of certainty.”
He added, “I can tell you, you don’t run a power plant 90 days at a time.”
Campbell has emerged as an early flashpoint against that backdrop. The 1,560-megawatt power plant, which first rumbled online in 1962, is the second-largest coal plant in Michigan. It reported carbon dioxide emissions of 8.9 million in 2024, second-most of any Michigan power plant and equivalent to the annual emissions of almost 1.9 million gasoline powered cars.
Consumers Energy, the plant’s owner, agreed to a phase out the plant in 2021 as part of plan approved by Michigan utility regulators, replacing it with a mix of natural gas and renewables. The utility reported in a financial filing last week that running Campbell through the end of June had cost it $29 million. It has asked the Federal Energy Regulatory Commission for permission to recoup the costs from Midwest power customers.
In a statement, Consumers Energy said it would comply with the “DOE order as long as it is in effect.”
The fight over the plant’s future likely will hinge on the legal definition of an energy emergency, industry observers said. When DOE issued the order to keep Campbell open, it cited a finding from the North American Electric Reliability Corporation that concluded the Midwest’s power grid was at “elevated risk” of not having enough power generation to meet demand during abnormally hot summer conditions.
But in a lawsuit challenging DOE’s decision, Michigan Attorney General Dana Nessel argued that NERC’s “elevated risk” designation did not constitute an emergency.
Elevated risk ranks second in NERC’s tier of risk designations, meaning the 15-state Midwestern grid serving Michigan is not in crisis, she wrote. State utility regulators already had signed off on a plan for Consumers to replace Campbell, she said, calling DOE’s order an “intrusion” on the state’s authority to regulate its power system.
EPA data shows Campbell generated 664 gigawatt hours of electricity in June, meaning the plant ran at roughly 60 percent of its capacity the month after it was scheduled to shut down. But the performance of its three turbines varied widely. Campbell’s largest, 916MW turbine, which was installed in 1980, ran at 81 percent of its nameplate capacity while a second, 378MW turbine installed in 1967 ran at only 5 percent of capacity.
A critical test arrived on June 23, when the Midwest’s regional grid operator directed all power plants in its 15-state region to run at max capacity to meet demand associated with a searing summer heat wave.
Campbell ran at 58 percent throughout the day. Its turbines followed the wider monthly pattern, with the 916MW turbine running at more than 80 percent throughout the day while the 378MW turbine never turned on. The plant’s third, 265MW turbine, installed in 1962, ran at almost full capacity until 3 p.m., when it powered down, EPA figures show.
Coal advocates said the figures are proof the plant is still needed by the Midwest’s power grid. The advocacy group Count on Coal said Wednesday that Midwestern consumers had likely saved nearly $5 million from Campbell’s continued operations, arguing that the region would have had to import expensive power had the plant shut down on schedule.
“Coal generation is up across the country this year and the coal fleet has proven exceptionally important in meeting soaring demand this summer,” said Conor Bernstein, a spokesperson for the National Mining Association. “Not only do you need these plants to maintain reliability but they uniquely have the capacity to ramp up production to meet rising demand while also providing some much needed dispatchable fuel diversity.”
But critics said Campbell was simply saddling customers with paying for a plant that’s not needed. Consumers and MISO, the regional grid operator serving Michigan and 14 other states, both signed off on Campbell’s retirement, said Howard Learner, the executive director of the Environmental Law and Policy Center.
“It’s time for the U.S. Department of Energy to stop the utility meter from running, which is presenting the question of who will pay tens of millions of dollars for an uneconomic fossil fuel plant that’s simply not needed to ensure reliability,” he said.
Hannah Rogers, an analyst who tracks the industry at the consulting firm Capstone, called DOE’s 202(c) directives to Campbell and Eddystone “unprecedented.”
If grid operators need a power plant to continue operating past its retirement date to ensure reliability, they traditionally ask federal energy regulators to approve additional payments to the plant to keep it open, she said. That’s what happened when the PJM Interconnection asked the Federal Energy Regulatory Commission to extend the life of a Maryland coal plant and oil plant scheduled to retire this year; FERC granted the request earlier this year. (DOE later used its section 202(c) authority to remove operational restrictions on the oil plant, H.A. Wagner.)
“In the past, 202(c) has been used to retain a plant or its operations during a time of critical blackouts or extreme emergencies,” she said. “This is unprecedented in that it’s being used to address resource adequacy, which is a pretty broad term, and also to kind of further the administration’s broader agenda.”
202(c) orders are 90 days in duration. But the Federal Power Act enables DOE to grant extensions — paving the way for the Trump administration to issue orders keeping Campbell open into the future, said Timothy Fox, an analyst at ClearView Energy Partners.
He too called DOE’s use of 202(c) unprecedented, but said that doesn’t mean the department is on shaky legal ground. The Federal Power Act gives the Energy secretary significant leeway to determine what constitutes an emergency, he said.
“I think we could see more of these orders,” Fox said.
This story also appears in Energywire.
