By Kennedy Maize
The same day (June 4) the Trump administration rolled out a billion dollar coal subsidy program, the Department of Energy announced another victim in its program to prevent any U.S. coal-fired power plants from closing. The administration is implementing an unstated, but clear in the application, policy of making sure no U.S. coal plants close during Trump’s tenure. At the core, it’s about politics, not energy.
DOE, in a boilerplate order citing “emergency” provisions of the Federal Power Act, told the Orlando Utilities Commission (OUC), the city’s municipally-owned electric and water provider, to keep its 465-MW coal-fired unit 1 at the Stanton Energy Center “available to operate” for the next 90-days. The utility had scheduled the unit, commissioned in 1987, to shut down this month.
The Orlando order is the latest of five previous DOE 90-day orders — four for coal-fired plants and one gas generator — all of which have seen those orders routinely repeated as the current 90-day order expired. The magic word that triggers the DOE orders is “risk” in any context. In the case of Florida, the DOE order notes that the North American Electric Reliability Corp. classifies the region “currently at a ‘Normal Risk’ for long-term energy adequacy.”
Energy Secretary Chris Wright said, “Taking reliable generation off the grid compromises energy reliability and needlessly raises energy costs for Americans. During peak summer demand, Floridians deserve continued access to affordable, reliable, and secure energy to power and cool their homes.”
As for the impact on Orlando’s electricity customers, DOE disavows any responsibility to cover the costs its order imposes. As in other, essentially identical, orders, that’s up to the Federal Energy Regulatory Commission, says DOE: “OUC is directed to file with the Federal Energy Regulatory Commission any tariff revisions or waivers to effectuate this Order, as needed. Rate recovery is available pursuant to 16 U.S.C. § 824a(c).”
OUC commented on the DOE order that it “will not be able to place Stanton Energy Center Unit 1 into extended cold shutdown at this time.
“Additionally, OUC will fully comply with the order while continuing to prioritize the safe and reliable delivery of electricity to our customers and community.”
OUC’s Stanton Energy Center consists of two 465-MW coal units, the second coming on line in 1996, and two gas-fired, combined-cycle units: the first, in 2003 at 688 MW and the second, a 333-MW combined-cycle machine commissioned in 2010.
OUC has been planning and working to convert both coal generators into gas units for the past five years. As part of that program, the muni in 2021 bought the 382-MW Osceola gas-fired, simple-cycle peaking plant, which was idle, from a private party for $100 million.
OUC saId at the time that the purchase would allow it “to retire its oldest coal-fired power plant, Stanton Unit 1 located in East Orange County at the utility’s Stanton Energy Center (SEC). The purchase further provides the utility an extra layer of resiliency because the Osceola site includes emergency backup fuel to help prevent power disruption events as seen in Texas last February.”
DOE’s serial orders to keep uneconomic coal plants in service face serious legal challenges. Utility Dive noted last month (May 19) that a legal challenge to DOE’s first 90-day order — keeping Consumers Energy’s J.H. Campbell coal plant in service — is now being challenged in the D.C. federal appeals court. The states of Michigan, Minnesota, Illinois, and the Earthjustice environmental law firm are challenging the repeated DOE orders to keep the plant running.
The company has been operating under the DOE order for more than a year, at a cost to consumers, approved by FERC, amounting to hundreds of millions of dollars.
The article commented, “A court decision expected later this year could set a precedent for the other pending cases. However, whichever side loses the case will likely appeal the decision to the U.S. Supreme Court, according to ClearView Energy Partners, a research firm.”
The Trump administration’s fixation on coal, including the $1 billion subsidy for existing and new plants and mines, and the move to prevent any coal generating plants from closing, earned criticism from the Washington Post, owned by Trump supporter Jeff Bezos.
A Post editorial — headlined “Trump’s central plan to boost coal” — said, “Certainly, the market is capable of signaling the need for new energy capacity — and it has done just that in recent years, amid the boom in data centers.”
The market has not chosen coal. Why not?
Said the Post, “Perhaps this is because coal plants are competing with cheaper and more efficient energy sources, including natural gas. Or perhaps it’s because they emit more pollution than other sources, including carbon dioxide, particulate matter and toxic heavy metals such as mercury and lead.
“In an era of seemingly endless demand, an all-of-the-above approach to energy makes sense. That requires politicians to simply get out of the way, not to not put their thumb off the scale for their preferred energy sources.”