Electricity From Coal Is Pricey. Should Consumers Have to Pay?

For decades, environmentalists fought power plants that burn coal, the dirtiest fossil fuel, by highlighting their pollution: soot, mercury and the carbon dioxide that is dangerously heating the planet.

But increasingly, opponents have been making an economic argument, telling regulators that electricity produced by coal is more expensive for consumers than power generated by solar, wind and other renewable sources.

And that’s been a winning strategy recently in two states where regulators forbade utilities from recouping their losses from coal-fired plants by passing those costs to ratepayers. The Sierra Club and the Natural Resources Defense Council, two leading environmental groups, are hoping that if utilities are forced to absorb all the costs of burning coal, it could speed the closures of uneconomical plants.

The groups are focused on utilities that generate electricity from coal and also distribute it. Those utilities have historically been allowed to pass their operating losses to customers, leaving them with costly electric bills while the plants emitted carbon dioxide that could have been avoided with a different fuel source, according to the environmental groups.

About 75 percent of the nation’s roughly 200 coal-fired power plants are owned by utilities that control both generation and distribution.

In 2023, utilities across the United States incurred about $3 billion in losses by running coal-fired power plants when it was cheaper to buy power from lower-cost, less polluting sources, according to RMI, a nonprofit research organization focused on clean energy. About 96 percent of those losses were incurred by plants that controlled both power generation and distribution, the organization said.