As the Trump administration’s attempts to save coal have stalled, a record number of coal plants were shut down or scheduled for shut down in 2018.
The federal government has floated extra compensation for coal and nuclear plants, it has tried to use federal wartime powers to mandate that coal plants stay open, and it has rolled back the Clean Power Plan in the hopes that fewer regulations would help coal power plants stay solvent.
The federal government is still working to boost coal. In yesterday’s budget proposal, the Trump administration proposed extensive cuts to a variety of renewable and efficiency programs run by the Department of Energy and the Environmental Protection Agency, but it said it wanted to increase the Bureau of Land Management’s coal management program funding by $7.89 million. In addition, the Office of Fossil Energy Research and Development saw a proposed increase in funds by $60 million.
But in case that doesn’t work, local governments and impacted communities are now taking matters into their own hands, trying to keep dying coal plants open, with mixed success.
Wyoming’s “Find a Buyer” rule
Yesterday, Wyoming’s Governor signed a bill that will require utilities to attempt to find a buyer for coal plants that they want to retire.
Generally, a utility in Wyoming can apply to the Wyoming Public Service Commission for “cost recovery,” that is, charging customers more or different rates for electricity based on the investments that the utility made or plans on making. But this recently passed bill mandates that the utility cannot recover any costs related to retiring a coal plant unless the utility has attempted to sell the coal plant to another buyer.
In addition, if the utility finds another buyer, it is required to buy electricity from that coal plant buyer as long as the price of that electricity is below the avoided cost to the utility of retiring the plant. But Wyoming regulators can determine what that avoided cost is, including “The value of any reliability benefits associated with the operation of the facility,” or any other factor they deem relevant. (Coal proponents often cite coal’s “reliability” as a reason why it should be preserved, although coal still suffers during flooding and freezing events.)
Under the new law, utilities can’t buy cheaper electricity if it’s available, nor can they recover costs “associated with new electric generation facilities built, in whole or in part, to replace the electricity generated from one (1) or more coal fired electric generating facilities located in Wyoming and retired on or after January 1, 2022…”
Electricity cooperatives are exempt from the law.
Coal-fired server farm and/or bitcoin mine?
Some smaller coal plants have already found buyers without a government mandate. Earlier this month, the reported that a small, 107MW coal plant outside of Hardin, Montana, found a buyer in a company called Big Horn Datapower Holdings LLC.
Little is known about the company, but Ars discovered a similarly named company listed in Delaware. The company was incorporated in October 2018, and its registered agent is a company called Cogency Global, Inc. When Ars contacted the registered agent, a representative said Cogency rarely knew anything about its clients’ business, and its function as registered agent was to forward official documents to the owners of the company.
But the said the name of the company suggests that it is a cryptocurrency mining outfit that city officials discussed months before as a potential buyer. Minutes from Hardin’s City Council Meetings (PDF) frequently refer to a “server farm” as a potential buyer. “The power plant has joined with a server company and the project is expected to create fifty to sixty long term jobs,” minutes from the December 2018 meeting read.
Rather than partner with Rocky Mountain Power, the old owner, the Federal Energy Regulatory Commission (FERC) appears to have approved a sale to Big Horn Datapower. “Attorneys for Rocky Mountain Power told The Gazette in 2018 that the Hardin plant would need up to $15 million in improvements to serve a data center, including transformers that would reduce the voltage coming from the plant,” according to the .
Navajo plant impasse
One of the largest coal-fired power plants in the US is the Navajo Generating Station. Its owners decided to close the plant in 2017, but the economic ramifications have had local leaders scrambling to find a new buyer. The coal plant and its accompanying coal mine employ hundreds of Navajo Nation people and supply the tribe with $40 million in royalties every year, according to the Associated Press.
Last year, Peabody Energy, which owns the mine that supplies the Navajo Generating Station, hired a consulting group to find a buyer for Navajo to keep it running. By September, the two front-runners most interested in an acquisition of the power plant backed out.
In response, the Navajo Nation tasked its Navajo Transitional Energy Company with exploring whether it ought to buy out the coal plant itself. But according to the Associated Press, those talks have recently been suspended over concerns about who will pay for the environmental cleanup after the coal plant has really, truly reached the end of its life. The current owners want the Navajo Transitional Energy Company to take over any known or unknown liabilities associated with plant cleanup. Unknown liabilities would include changes to decommissioning regulation.
A meeting of Navajo Nation Council delegates on Sunday brought together people who are for and against purchasing the coal plant. According to New Mexico’s , split opinions on the venture still prevail.