Challenges ahead for reopening closed coal plants due to market conditions

Amidst an “energy emergency,” the United States government has proposed the revival of retired coal-fired power plants to fulfill the expected surge in electricity demand. However, recent research from IEEFA reveals that very few, if any, of the 102 coal-fired units closed within the past four years are actually viable candidates for revival. An analysis conducted by IEEFA examined these 102 units that have remained inactive since the beginning of 2021 and determined that the majority are not suitable for reinstatement.

These plants, which have been shut down or converted, demonstrate a median age of 56 years, with 24 of them already demolished, 13 converted to gas, and only one transformed to oil. Due to their age and prolonged inactivity, reopening these coal plants would be both costly and operationally ineffective. As coal facilities age, their maintenance expenses escalate, leading to higher generation costs that render them uncompetitive compared to alternative sources like solar, wind, and battery power.

The current operational coal plants are not running at full capacity, indicating that there is excess generation capability within the existing fleet. However, this surplus capacity is not economically feasible to utilize due to the rising costs associated with aging coal infrastructure. Channeling public funds towards reopening these retired coal plants, given their uncertain maintenance requirements and diminishing efficiency, does not align with economic prudence.

Focusing on restarting closed coal plants contradicts the economic realities of the energy market, where solar, wind, and dispatchable battery storage offer more cost-effective and quickly deployable solutions. Reverting to coal as a primary energy source not only disregards the environmental implications but also exposes the government to financial risks associated with inefficient and outdated infrastructure. Instead, investment in renewable energy technologies presents a more viable and sustainable option to boost energy generation capacity rapidly and economically.

In conclusion, the executive orders aimed at revitalizing closed coal plants as a response to the perceived energy crisis lack economic rationale. The current trajectory of the energy market favors renewable solutions for their cost-effectiveness and efficiency, making the revival of outdated coal facilities an impractical and counterproductive endeavor. By prioritizing the expansion of wind, solar, and battery storage technologies, the United States can effectively address its energy needs while ensuring a sustainable and environmentally friendly energy future.