Activists, officials call for closure of Ottawa County coal plant as utility looks to recover costs

BY SARAH LEACH, MICHIGAN ADVANCE

OTTAWA COUNTY—“We are standing here today to stand up to the Trump Administration to tell them, ‘Get this coal plant shut down.’”

That was the message that lawmakers, health professionals and other officials said at a Tuesday, Aug. 12, press conference near the J.H. Campbell coal plant in West Michigan’s Ottawa County, which has become the epicenter of a legal battle between the US Department of Energy and Michigan Attorney General Dana Nessel.

The plant, operating since 1962, was originally scheduled to close partially in 2030 and wholly in 2040. But the utility announced in 2021 it was moving the plan up by 15 years for an operations end date of May 31, 2025.

Consumers has said closing the plant was expected to save Michigan ratepayers $600 million by 2040.

The utility was seeking to end coal use altogether by 2025 as part of its goal to achieve carbon neutrality.

Since the announcement, Consumers has been actively preparing the plant for “full retirement,” a spokesperson said last year.

“The complex will officially go into retirement with an aim to go cold and dark after 2025,” said former Consumers spokesperson Kristen Van Kley. “In 2026 and on, the complex will be demolished with a plan to restore the site over time.”

The plant, when operating at full capacity, can generate 1,450 megawatts of electricity. Michigan consumed about 113,740 gigawatt hours of electricity in 2019, according to a 2020 report from the U.S. Department of Energy.

At the time, Van Kley said new technologies would ensure Consumers would be able to continue supporting the statewide grid.

“Energy efficiency, demand response and emerging technologies such as grid modernization and battery storage will help us lower peak customer demand for electricity and deliver exactly what Michigan needs,” she said. “Our plan is designed to respond to emerging needs, adapt to changing conditions and embrace emerging innovative technologies as we work to achieve net-zero carbon emissions.”

On May 23, Secretary Wright directed the Midcontinent Independent System Operator in coordination with Consumers, to ensure that the 1,560 megawatt plant “[remain] available for operation, minimizing any potential capacity shortfall that could lead to unnecessary power outages.”

“Today’s emergency order ensures that Michiganders and the greater Midwest region do not lose critical power generation capability as summer begins and electricity demand regularly reach high levels,” Wright said in a prepared news release.

The Energy Department said the emergency order, which is issued by the Office of Cybersecurity, Energy Security, and Emergency Response, is authorized by Section 202(c) of the Federal Power Act and is in accordance with President Trump’s Executive Order: Declaring a National Energy Emergency to ensure that power generation availability in the region does not “dip below 2024 capacity levels.”

“This administration will not sit back and allow dangerous energy subtraction policies threaten the resiliency of our grid and raise electricity prices on American families. With President Trump’s leadership, the Energy Department is hard at work securing the American people access to affordable, reliable, and secure energy that powers their lives regardless of whether the wind is blowing or the sun is shining.”

In June, Nessel—along with a collective group of public interest organizations, Minnesota and Illinois, Maryland Office of People’s Counsel, and the Organization of Midcontinent Independent System Operator States—challenged the DOE’s order to keep the Campbell plant in Port Sheldon Township to remain open for 90 days, arguing that the move will force customers to absorb exorbitant costs.

US Secretary of Energy Chris Wright issued the emergency order demanding that the plant “remain available for operation” on Friday, May 23—just eight days before the plant was scheduled to shut down, a plan that has been in place since 2021.

The US Department of Energy said the move was intended “to minimize the risk of blackouts and address critical grid security issues in the Midwestern region of the United States ahead of the high electricity demand expected this summer.”

Nessel filed a request for rehearing with the DOE, challenging what she described as an “arbitrary and illegal order seeking to stop the planned retirement of Consumers Energy’s J.H. Campbell coal-fired power plant in West Olive, Michigan, under the pretense of a fabricated energy emergency.”

She said the order “will burden Michigan utility customers with unnecessary costs and needless additional pollution from the 60-year-old Ottawa County coal plant that was scheduled to close May 31.”

A request for rehearing is a legal process where a party asks a court to reconsider a decision it has already made. It’s typically used when a party believes the court made a mistake in its initial ruling, whether by overlooking a crucial fact, misinterpreting the law, or making some other error.

When the DOE didn’t respond to Nessel’s request within 21 days, she filed a petition for review July 24 with the US Court of Appeals for the Washington, D.C., Circuit, challenging the US Department of Energy’s order, claiming the “arbitrary and illegal” move forced the continued operation of the plant “under the pretense of a fabricated energy emergency.”

“This unprecedented order by the Department of Energy declares an emergency without evidence, completely ignores state and federal regulators that approved the plant’s retirement, and will potentially put enormous costs onto utility customers who receive no real benefit,” Nessel said. “I will continue to fight to protect Michigan customers from unreasonable costs imposed by the federal government.”

Last month, Nessel also filed a pleading before the Federal Energy Regulatory Commission in response to Consumers’ request to recover the costs from running the Campbell plant beyond its initial retirement date. That proceeding is still ongoing.

Katie Carey, director of media relations for Consumers, said Tuesday that the utility is continuing to comply with the DOE order and has requested “the timely recovery of costs associated with plant operations.”

“We expect FERC will take timely action on our request. Our FERC filing from Friday, June 6, requests approval of a mechanism to recover and allocate those costs through MISO.

What’s happening now

Tuesday’s event saw environmental activists, health experts and politicians calling on the closure of the Campbell plant—whether that be the DOE not renewing the emergency order or reversing it before it expires on Aug. 20.

Jayce Bylenga, West Michigan regional coordinator for Michigan League of Conservation Voters, read a prepared statement from Nessel at Tuesday’s event, which Bylenga’s group helped organize, along with the Sierra Club.

“My department signed a settlement with Consumers in 2021 that included the retirement of the Campbell coal plant and made all due preparations to maintain our state’s energy load without it. Our plan, were it not curtailed by the baseless actions of the Trump Administration, just eight days before it would have gone into effect — was set to save Michigan customers nearly $600 million never before is the Department of Energy delayed the retirement of a power plant absent a request from the operating utility or local government body,” Nessel said in the statement.

Nessel said the majority of Michigan residents don’t want to see rate hikes passed along to them and the continuation of burning fossil fuels.

“The costs of maintaining production at the plant, long since prepared for closure, could be an enormous burden on the rate-paying customers of Consumers Energy,” she said. “And that’s before taking into account the environmental and public health costs of continuing to fuel a coal-powered plant.”

In a June 3 statement, a Consumers spokesperson said the company is currently complying with the order.

“We are currently in compliance with the order, have arranged for new shipments of coal, some of which arrived last week, and will continuously operate the Campbell Plant,” Trisha Bloembergen, West Michigan media relations specialist, said in a June 3 email. “We are still determining the overall cost, but want to ensure those costs are shared across MISO and not all on Consumers Energy customers.”

Generating power at the Campbell plant is likely to be costly for ratepayers, experts from the Institute for Energy Economics and Financial Analysis wrote June 5.

Campbell Units 1 and 2, which are 63 and 58 years old, respectively, were already increasingly uncompetitive in the MISO market, meaning it cost more to generate electricity than what it could be sold for, said energy data analysts Seth Feaster and Dennis Wamsted.

According to data filed by Consumers at FERC, the operation and maintenance costs for the two units totaled $45.80 per megawatt-hour (MWh) in 2023 (the most recent data available). That puts both units in the red almost all the time in MISO: S&P data shows that the monthly around-the-clock price at the Michigan hub has been above $40/MWh just twice in the past two years, and never during the summer.

“In other words, the plant would lose money on virtually every MWh generated if past prices hold this summer, costs that could add up to many more millions of dollars if the units at Campbell are run for any substantial amount of time,” Feaster and Wamsted said.

Beyond operational costs, there are fuel and staffing costs as well.

“Coal itself has gotten more expensive,” said Frank Rambo, executive director at Horizon Climate Initiative, a nonprofit organization that works to use cost-saving energy market reforms to address the causes and impacts of climate change.

“That fleet has gotten more expensive to run. It’s coal, which used to be synonymous with cheap power. It’s now among the most expensive power … and then the excess costs that are incurred because they’re running more expensive resources.

Ultimately, it will be residents who foot the bill, Rambo said.

“They run those coal plants, and then they turn around, go to their commissions and recover those excess costs from their customers,” he said.

Rambo said the price could be even higher than normal because Consumers would need to buy coal on the open market rather than enter into a new contract with a mine.

“We don’t need to sign a new long-term coal supply contract because we’re shutting the plant down,” he said. “Now they may have to buy coal on the spot market.”

The price of coal has hovered around $110 per ton on the US commodities exchange. As of June 19, the price of coal was $103.85 per ton.

In 2024, Campbell burned more than 3.7 million tons of coal, Feaster and Wamsted said. That is an average of 12,700 tons of coal a day, which would amount to $1,318,895 per day using today’s prices.

According to Dan Scripps, chair of the Michigan Public Service Commission, keeping this coal plant on life support even for 90 days may add upwards of $100 million in additional costs — the bulk of which will be passed on to ratepayers across the 15 states.

All of the Campbell plant’s coal was previously delivered by rail from the Powder River Basin in northern Wyoming, according to the IEFF.

Two of the PRB’s biggest mines provided that coal: Arch Resources’ Black Thunder Mine, which delivered 2.25 million tons, and Peabody Energy’s North Antelope Rochelle Mine, which delivered 1.47 million tons.

Rambo also noted the plant staffing issue, explaining that Consumers likely already had phased out several employees who were then called back.

“We were laying these people off. Now we’re going to have to hire them as contractors,” likely at a higher pay rate because the work would be temporary, Rambo explained.

“There are all sorts of excess costs that would not be incurred, but for the fact that there’s now this executive order,” he said.

Carey, of Consumers, said Tuesday that the utility’s costs will “depend on a number of factors, including offsetting revenue from plant operations, and are still being determined.”

“The cost of operating the plant will be shared by customers across the north and central MISO region, consistent with the DOE order,” she said. “We will continue to work with MISO and with federal and state regulators to ensure compliance with the order and appropriate cost recovery.”

READ MORE: Trump’s fake ‘energy emergency’ hits West Michigan

This coverage was republished from Michigan Advance pursuant to a Creative Commons license.