Coal Fired Units Shutting Down Despite Lower Generating Prices

The Energy Information Administration (EIA) is reporting that over 5 gigawatts of additional coal-fired plant retirements have been announced by owners and operators of the plants since November 2013 mainly to comply with EPA’s Mercury and Air Toxics Standards (MATS). These 5.4 gigawatts of recently announced retirements are above the 40 plus gigawatts that IER reported in this blog and likely part of the 60 gigawatts that EIA expects to be retired as part of its Annual Energy Outlook 2014 forecast, which is based on existing laws and regulations. Unfortunately, these retirements are only going to cause problems for the grid in keeping electricity on during peak demand periods and to increase prices for consumers. States with a significant amount of coal-fired capacity in the Central part of the United States have lower electricity prices on average than those that generate very little electricity from coal in the Northeast and in California.