Coal-Fired Power Plant Retirements in the United States

Rebecca J. Davis, J Holladay and Charles Sims

Environmental and Energy Policy and the Economy, 2022, vol. 3, issue 1, 4 - 36

Abstract: We summarize the history of US coal-fired plant retirements over the past decade, describe planned future retirements, and forecast the remaining operating life for every operating coal-fired generator at each plant. Nearly one-third of the coal fleet retired during the 2010s and a quarter of the remaining capacity has announced plans to retire. We summarize the technology and location trends that are correlated with the observed retirements. We then describe a theoretical model of the retirement decision coal generator owners face. We use retirements from the past decade to quantify the relationships in the model for retired generators. Our model predicts that three-quarters of coal generation capacity will retire in the next 20 years, with most of that retirement concentrated in the next 5 years. Policy has limited ability to affect retirement times. A $20 per megawatt-hour electricity subsidy extends the average life of a generator by 6 years. A $51 per ton carbon tax brings forward retirement dates by about 2 years. In all scenarios, a handful of electricity generators remain on the grid beyond our forecast horizon.

Date: 2022
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