The recent Inside Climate News article claims that delaying coal and gas plant retirements would cost ratepayers $3-6 billion annually, which is not only misleading but also dangerously out of touch with the realities of America's electricity system. A new report by Grid Strategies, commissioned by environmental groups, Earthjustice and the Sierra Club, argues that the Trump administration’s orders keeping aging plants like Michigan's Campbell and Pennsylvania's Eddystone online are inflating costs.
But evidence from the PJM, the nation's largest grid operator, tells a starkly different story. It's the rush to retire these reliable hydrocarbon assets that's driving up prices, not their extensions.
Look no further than PJM's (which keeps the lights on for 67 million people) recent capacity auctions, which sent shockwaves through 13 states and the District of Columbia. In July 2024, capacity prices exploded 833% to $269.92 per megawatt-day, ballooning total costs from $2.2 billion to $14.7 billion. Fast forward to July 2025, prices climbed another 22% to $329.17/MW-day, pushing annual costs to $16.1 billion.
What’s fueling this? A toxic mix of decreasing supply from coal and natural gas thermal plant retirements, skyrocketing demand from data centers, electrification, and manufacturing resurgence, and electric wholesale purchasing methods.
PJM officials warn of capacity shortages as early as 2026, with thermal generators, dispatchable workhorses like coal and gas, being retired at a "rapid pace" due to policy and economic pressures. Without these plants, the grid faces blackouts and huge costs, and wind and solar can't fill the gap reliably, because they are part-time and weather dependent.
Critics ignore the economics of displacement. In the electric grid’s current “pay-the-clearing-price” system, heavily subsidized wind and solar energies should theoretically lower prices, but they displace rather than replace hydrocarbon generation, reducing operating hours for coal and gas plants. With fuel costs comprising only 25-40% of their expenses, the bulk (60-75%) is fixed: capital, maintenance, and labor.
Spread over fewer hours, these costs force surviving plants to bid higher to break even, setting the market's uniform clearing (highest) price paid to all generators. Wind and solar only increase costs because they get the highest price for windfall profits and cause their thermal generator competition to charge higher prices, while electricity consumers pay through the nose.
Everyone, including the wind and solar utilities, get paid that inflated rate, which is the highest rate they take. People are now waking up from the “green” dream and repeated false claims that wind and solar are cheap energy.
It has now turned into a nightmare for those with limited incomes, as those with the lowest incomes spend the greatest portion of their income on energy costs. This makes it tough for them to make ends meet, as it takes money away from other priorities like rent, food, and their children.
The Trump administration's DOE orders for Campbell and Eddystone to stay productive aren't burdensome; they're bulwarks against chaos and blackouts. Campbell's $29 million extension cost pales against PJM's billions in auction hikes.
The Federal Energy Regulatory Commission Chairman Mark Christie said in March, “The alarming rate of base load generation retirements and lack of new dispatchable generation is not sustainable and must be addressed.” By keeping these plants online, we're ensuring baseload reliability during peaks when intermittency fails. We must have on demand, reliable thermal generation to keep our homes safe, affordable, and comfortable, and to keep manufacturing humming, and hospitals supplied with electricity.
Environmental advocates decry "unneeded" plants, but markets disagree. California, Germany, and European countries with more wind and solar have rates double or more than the US average, as well as less reliable grids. Retiring more coal and natural gas plants now will only make shortages worse, spiking prices further.
As seen in Texas during Winter Storm Uri, where limited capacity led to the whopping $216,000/MW-day extreme, while wind and solar produced almost no power when needed most, and gas and coal increased their output by as much as five times before they had problems.
The Grid Strategies report, backed by intervenors in extension cases, cherry-picks data to push an agenda. It overlooks how plant closures cause prices to skyrocket and leaves us short of electricity.
True savings come from ending subsidies and preferences for wind, solar, batteries, and the transmission wires they need, while also not shuttering hydrocarbon plants prematurely. If this were allowed to continue, our economy, national security, and pocketbooks will be in jeopardy.
Ratepayers deserve affordability and reliability, not ideological experiments, and delaying retirements isn't costing billions. It's saving billions by averting the PJM nightmare. Policymakers should heed the market's warnings: Keep the lights on at all times or pay the price.
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