Rumors of the demise of U.S. coal-fired power plants are greatly exaggerated, according to a new report from Moody’s Investor Services.
Increasing emissions regulations are leading to the retirement of more coal power plants, Moody’s said. But other new plants came online in the last five years, especially in the Midwest. And many have been built to comply with additional federal standards.
While coal is expected to lose market share, federal projects show that coal-fired generation capacity is expected to remain largely unchanged through 2024. Although 13 gigawatts of coal power capacity is retiring in 2015, Moody’s noted that no massive retirements are planned beyond this year. In fact, coal power generation increased in 2013 and in 2014.
Switching all coal power to natural gas-fired power generation would increase electricity costs by more than 11 percent, Moody’s estimated, and the hikes would be substantially greater switching more to wind, solar or nuclear power, even though wind and solar power generation is becoming more efficient with time.
The Obama administration’s Clean Power Plan that would dramatically reduce power plant emissions could come out as soon as August, but Moody’s stated that there is the strong potential for delays and adjustment. The Supreme Court also is making the White House re-do its rules limiting mercury and air toxins from the plants.
Coal-fired electricity generation capacity was 27 percent of the nation’s total electric supply last year, which is down from 31 percent in 2005. More than 10 gigawatts of coal-fired capacity was lost during the 10-year span.