Duke Extends the Life of Its Largest Coal Plant

Duke Energy Corp. plans to extend the life of its largest coal-fired power plant for 3 years, pushing aside its climate goal to shutter all facilities that burn coal by 2035. It plans to operate its Gibson Station in Indiana through 2038, despite previously saying that it would shutter the plant by 2035, in line with its earlier plan to be entirely coal-free by that year. Duke says its emission-reduction goals are not changed but are not linear and its resource plans are not final decisions as they are revised regularly. Duke also plans to build much less renewable energy than it planned back in 2021, despite plans to build solar power and battery storage. Duke’s power demand has grown in recent years and grid requirements prevent it from relying more on solar power.

The utility outlined its plans in an online presentation  that said the 3339.5 megawatt Gibson station in Indiana would convert two of five total units to “enable co-firing natural gas with coal, allowing them to continue to operate through 2038.” The utility listed that 2038 scenario as its “preferred portfolio” in the presentation, despite previously planning to retire the facility by 2035 with the rest of its coal fleet.

U.S. utilities are struggling to meet climate goals while meeting new demands from data centers for artificial intelligence and from the electrification of everything by the Biden-Harris administration. This demand increase after years of flat or slow electricity demand growth complicates the energy transition and efforts to shutter fossil fuel power plants that the Biden-Harris administration is advocating through onerous regulations. Nonetheless, that demand growth should have been anticipated if electric cars and electric appliances that can easily double electricity demand are mandated through Biden-Harris EPA regulations and DOE standards.

Earlier this year, FirstEnergy Corp. announced it was abandoning its 2030 target for cutting greenhouse gas emissions because it could not replace some coal plants in time. Replacing perfectly good coal plants prematurely and replacing them with new solar or wind plants raises costs for utility companies and corresponding rates for consumers. In April, Duke Chief Executive Officer Lynn Good said that the enormous electricity demand complicates Duke’s goals to cut carbon emissions. Thus, the utility is unable to shutter its largest reliable coal generator by 2035.

Other Companies Are Pulling Back on Climate Action

Large corporations, including Unilever, Bank of America, and Shell, have in the past year dropped or missed goals to cut emissions or to reduce ties with sectors that emit the most carbon dioxide because, they say, political and regulatory factors outside their control are slowing progress. These include a failure of standard-setting and clear regulation, insufficient government support, and delays in the rollout of new technologies. Yet even if they do hit their goals, some executives have said, they may not be able to prove it, because of the guesswork built into relatively new carbon footprint measurement techniques.

Many companies had set their goals without realizing how much work it would be to meet them, setting lofty corporate climate targets in the wake of the U.N. Paris Agreement. The pronouncements reached a peak during the pandemic and the COP26 climate negotiations in Glasgow. More than 10,000 companies globally committed to cut emissions under the auspices of a United Nations campaign. The median goal of 51 major companies was to cut emissions 30 percent by 2030. In March, hundreds of the companies, including Microsoft, Unilever and Brazilian meatpacker JBS, were removed from a validation process by the Science-Based Targets Initiative as they had failed to set sufficiently meaningful targets.

Many Western automakers have slowed their transition from combustion engine production to EV manufacture as electric vehicle exports from China have surged into Europe and the consumer demand for electric vehicles has slowed both in Europe and the United States. Europe’s largest carmaker Volkswagen no longer refers to its previous voluntary target to cut carbon dioxide emissions from passenger cars and light commercial vehicles by 30 percent between 2015 and 2025.  Instead, its new goal is to cut them by the same amount between 2018 and 2030. Volkswagen is looking to close facilities to help cut costs in the wake of the costly transition. Automakers in the United States are laying off workers and slowing their transition to electric vehicles as they are losing money on each electric vehicle they produce that must be subsidized by gasoline vehicle sales. This is driving the costs of all vehicles higher and pricing more consumers out of being able to purchase a new vehicle.

Oil companies are also abandoning their climate targets. Shell, for instance, has abandoned its 2035 target of a 45 percent reduction in net carbon intensity–a key milestone towards Shell’s broader goal of net-zero emissions by 2050–citing “uncertainty in the pace of change in the energy transition.” The oil major updated its target to cut the total “net carbon intensity” of all the energy products it sells to customers – emissions per unit of energy – by 20 percent between 2016 and 2030, now setting the reduction between 15 and 20 percent. The company says investment in oil and gas “will be needed” due to sustained demand for fossil fuels and the importance of liquified natural gas for the energy transition, planning to grow its LNG business by up to 30 percent by 2030. BP has also scaled back its emissions reduction commitment, reducing its target from a 40 percent cut by 2030 due to the financial benefits of continuing with fossil fuels.

Conclusion

Duke Energy is delaying its largest coal plant closure by 3 years as electricity demand that had been stagnating has increased from AI data centers and Biden-Harris electrification regulations and standards. Other utility companies, such as FirstEnergy, are also finding that they cannot move from their reliable coal plants to solar and wind power as quickly as the Biden-Harris administration wants. And, it is not just the utility sector as other companies are also moving away from their climate commitments, including tech companies, automakers, manufacturers, and oil firms. They are finding that it is not as easy as it was touted to meet the lofty commitments they made as a result of the Paris Accord, as many Western automakers are losing money on every electric vehicle they produce.