August 24, 2025 - Nothing tells us more about the importance of coal-based electricity than the experience of the Midcontinent Independent System Operator (MISO) in the last eight months. MISO covers 15 midwestern states plus Manitoba with 45 million people. At a recent Congressional hearing on reliability, Jennifer Curran, Senior VP of Planning, testified the retirement of existing coal power plants “threatens to outpace the ability of new resources”. She speaks from experience. In the January Polar Vortex, MISO’s coal capacity factor increased to 73% vs 56% for natural gas and only 14% for solar. Energy Ventures Analysis concluded: “Coal-fired power plants, with their on-site fuel storage and stable fuel costs, proved critical in bridging the demand gap when renewable output was constrained, and natural gas prices became highly volatile”. Importantly, similar results occurred during the June heat wave where EVA found the capacity factor for coal rose to 63%---higher than natural gas and far beyond wind and solar, which were “unable to respond due to time of-day and weather limitations”.
Despite these experiences in just the past seven months, the utility (Consumers Energy), the rabidly biased anti-coal Sierra Club, and the Attorney General of Michigan want to prematurely close the 1,420-MW J.H. Campbell coal power plant in West Olive, MI. Only an Executive Order from President Trump has kept the plant open while the case proceeds in court. And please note, in Michigan, where the unfathomable goal is to close crucial coal generation, the cost of natural gas to produce electricity during the polar vortex was 80% greater than the cost of coal.
For decades, fuel diversity, dispatchability, redundancy and resiliency have been the hallmark concepts of utility system planners. In recent years, however, these goals have become increasingly remote. The closure of productive coal plants is significantly weakening the key pillar of reliable and affordable power. NERC has already cautioned that some regions of the country may not be able to meet the load as soon as next year. Costs may also rise dramatically due to an over dependence on natural gas -- the fuel with the greatest price volatility. In February 2024 the Henry Hub Natural Gas Spot Price per Million Btu was $1.72. By February 2025 the cost of NG was $4.19, an increase of almost 145% in just 12 months.
Consider New England, where fuel diversity has fallen by the wayside and a practically monolithic fuel structure has developed in several states. Connecticut obtains 60% of its electricity from natural gas. In Rhode Island the figure is 85% and in Massachusetts 70%. As Housley Carr, of RBN Energy points out: New England electricity and natural gas prices typically peak during the winter months. At that point, much of the gas flowing into New England is used for space heating, frequently leaving many gas power plants with only a fraction of what they need to meet demand. When the region experienced an extended cold snap, wholesale natural gas prices (a major factor in electricity prices) averaged $16.92 per million Btu— a dramatic 300% higher than the average Henry Hub cost that month. Lack of fuel diversity exacts a high price indeed.
But now, gas supply becomes an issue. Natural gas is seen as a default fuel for increased electricity generation in the United States. At least 70% of proposed Data Centers have identified natural gas as their main source of electricity going forward. But data centers are not the only vectors of demand for power that are rapidly increasing--- re-industrialization, electric vehicles, battery manufacturing, mining, mineral processing, transportation, air conditioning -- the list goes on and on. Further, natural gas supply faces two other major realities- (1) over 50% of American homes use gas for space heating and in the Midwest it reaches 70%. In winter cold spells, gas is routinely diverted from power plants to residential heating; (2) The US has now committed to exporting vast amounts of LNG through the construction of terminals capable of removing over 32 Bcf/ day out of a production level not expected to exceed 115 Bcf/d for over a decade – that is over 25% of production removed from domestic supply. Obviously, the competition for natural gas will be increasingly intense and the price will rise accordingly.
But don’t look to nuclear power for solace. Nuclear has cost, supply chain, waste disposal and time required issues that will limit significant expansion until upwards of 2040 if at all. As Robert Bryce has pointed out, the Nuclear Regulatory Commission has approved just five nuclear plants in the last 30 years and only two have been built. And these two Vogtle reactors in Georgia cost $35 billion, 2.5 times the projected price. Efforts to build Small Modular Reactors (SMRs) will face a moribund supply chain, skeptical regulators, endless litigation and exploding costs. In Utah, the proposed NuScale SMR saw estimated costs rise to $4.2 billion in 2018, $6.1 billion in 2020, and finally $9.3 billion in 2023, Then the plant was cancelled.
Wind and solar --Baseload power plants (coal, nuclear, generally natural gas)) operate to serve demand on an around-the-clock basis, producing electricity at a constant rate and thereby maximizing efficiency and minimizing costs. Baseload units are dispatchable and can be programmed according to market needs. Wind and solar are not baseload because they are intermittent, inherently non-dispatchable and therefore cannot meet the 24/7 needs of data centers and similar sources of demand . Advocates have argued for a hodgepodge of wind, solar and batteries but beyond the prohibitive cost of such a structure the reality is that China controls the supply chain for solar panels, wind turbines and battery systems. Further, Robert Bryce has warned that China has a chokehold on about three dozen key elements in the Periodic Table which are crucial to renewables, “with an average market share of around 70%” for each.
How much more evidence do we need that coal power plants are essential for reliability and affordability? Simply put: (1) Keep existing plants operating and, where possible, increase their capacity, (2) Adjust Renewable Portfolio Standards which unnecessarily handcuff coal plant production, (3) Recommission closed plants that were prematurely and unnecessarily retired and (4) Build new plants using the advanced clean coal technologies being successfully employed in other parts of the world (e.g. Supercritical combustion).
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Frank Clemente PhD. specializes in research on the socioeconomic impact of energy policy and is the author of The Global Value of Coal, published by the International Energy Agency (2012). Professor Clemente has served on the faculty of the University of Kentucky, University of Wisconsin and Penn State. He has extensive experience in speaking, writing and presenting data on the value of coal to the United States and the world. All opinions expressed here are presented independently from any university with which he has been affiliated.
Fred Palmer Esq. served as CEO of Western Fuels before he joined Peabody Energy as Senior Vice President for Government Affairs. Palmer was Chair of the World Coal Association Board and a member of the National Coal Council. He received the American Institute of Mining, Metallurgical and Petroleum Engineers Award for “Distinguished Achievement in Coal Technology”. He also received a Statement of Appreciation from the National Coal Council in 2015 with a plaque for “Guidance since 1990”.
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