Coal’s Slowdown Is Slowing Down

The United States has been able to drive its greenhouse gas emissions to their lowest level since the early 1990s largely by reducing the amount of energy on the grid generated by coal to a vast extent. In 2005, by far the predominant source of U.S. electricity, making up some 2.2 million gigawatt-hours of the country’s 4.3 million GWh total energy consumption, according to the International Energy Agency. In 2022, by contrast, coal generation was down to 900,000 GWh out of 4.5 million GWh generated. As a result, “U.S. emissions are 15.8% lower than 2005 levels, while power emissions are 40% lower than 2005 levels,” according to BloombergNEF and the Business Council for Sustainable Energy.

But the steady retirement of coal plants may be slowing down. Only 2.3 GW of coal generating capacity are set to be shut down so far in 2024, according to the Energy Information Administration. While in 2025, that number is expect to jump up to 10.9 GW, the combined 13.2 GW of retired capacity pales in comparison of the more than 22 GW retired in the past two years, according to EIA figures. Over the past decade, coal retirements have averaged about 10 GW a year, with actual retirements often outpacing forecasts.

As for the reasons behind the slowdown, some analysts think utilities and electricity markets — especially ones seeing increased demand on the East Coast — may decide to extend the life of their existing coal units to maintain reliability.

“The return of load growth, delays in bringing renewables online and a renewed focus on reliability have led utilities and other generation owners to delay and in some cases reconsider their plans for retiring coal plants altogether,” according to an S&P Global Commodities Insight note.

In the country’s largest electricity market, the PJM Interconnection, there are only six coal units set to be deactivated, and only one, Warrior Run in Maryland, set to be retired this year, with another coal-powered plant in the state, Brandon Shores, set to be retired in 2025. But even if some coal plants stay open longer than might have been expected, they may not be a boon to the coal extraction industry, which still has to deal with overall decreased demand for coal.

This week, a federal appeals court in Montana lifted a moratorium on coal leasing on federal lands. The original moratorium was enacted in 2016, and even though it’s bounced back and forth between administrations, the amount of coal produced on federal lands has fallen sharply since then. In 2014, there were around 420 million tons of coal produced on federal and native land; by 2021 — the last full year before the moratorium was put back into effect by a federal judge in 2022 — that figure had fallen to 277 million.