DOE Forces Busted Coal Plant to Stay Online for “Energy Emergency” but Halts 2.5 Million Homes’ Worth of New Power

Government kills clean energy projects that protect consumers, spikes energy bills to keep coal clunkers online

Try to make sense of this—while many of us were checked out over the holidays, the federal government issued contradictory orders that will make our grid less reliable while costing consumers money.

In the span of a week, the U.S. Department of Energy ordered four aging coal-fired generators to keep running for at least 90 days, three in Indiana and one in Colorado, while the U.S. Department of the Interior paused construction on five offshore wind projects, several of which are nearly finished.

The DOE already extended its order to keep Michigan’s JH Campbell coal plant running even though it cost consumers $164 million to keep it running over just four months. That precedent means DOE is highly likely to keep these additional zombie plants running even after they’re due to close. All four units were days away from retirements that had been planned for years.

The data clearly tells us coal is uneconomic and unreliable, while the East Coast’s offshore wind resources are world-class and could fight soaring power prices. It’s impossible to square the logic of these orders.

Forcing unreliable, expensive coal on consumers

None of the proposed coal retirements the DOE cancelled were a threat to reliability – state regulators had long-since approved utilities’ plans to handle the lost generation.

In its order, the DOE claimed, “[T]he emergency conditions resulting from increasing demand and shortage from accelerated retirement of generation facilities will continue in the near term and are also likely to continue in subsequent years. This could lead to the loss of power to homes, and businesses in the areas that may be affected by curtailments or power outages, presenting a risk to public health and safety.”

There’s two huge problems with that rationale—coal plants are America’s least reliable power source. North American Electric Reliability Corporation (NERC) data shows coal plants break down more frequently than gas, hydro, or nuclear generation with an average unplanned outage rate of 11.4 percent between 2020-2023, up from 8 percent between 2014-2017, and third-party analysis of NERC data reports coal has the highest “equipment-related outage rate,” or how often a generator is broken due to a mechanical issue.

That’s evident in Colorado – the coal plant forced to “stay open” is already broken down and cannot generate electricity. Eleven days before the DOE mandated it remain open, the 45-year old Craig Unit 1 coal facility experienced a valve failure that rendered it inoperable. Its owner, Tri-State Generation and Transmission Association, says consumers will pay the repair cost. “As a not-for-profit cooperative, our membership will bear the costs of compliance,” said Duane Highley, Tri-State CEO.

Nationally, aging coal plants (the average U.S. coal plant is 44 years old) are one of America’s most expensive power source and keep costing more as their infrastructure deteriorates. The cost of operating coal plants rose 28 percent between 2021 and 2024, nearly double the rate of inflation in the same period. That means additional DOE orders to force coal plants to stay online could increase consumer costs $3 to $5 billion annually.

Grid Strategies estimates it will cost $21 million to run Craig Unit 1 for the 90 days required under the DOE’s order, while running it for a year would cost up to $150 million. That’s on top of “repairs — to the tune of millions of dollars — just to get it running, all on the backs of Colorado ratepayers,” said Governor Jared Polis.

Colorado consumers paying Craig’s expensive bills isn’t new: The cost of running that clunker increased 67 percent between 2021 and 2024 – more than double the fleet average, and more than four times the rate of inflation.

Indiana’s situation is similar – the three coal units there are broken down or expensive.

Schafer Unit 18, one of the generators DOE forced to stay open, has been broken since July 2025. “It can take six months or longer for us to ultimately be able to get that unit back to where it would need to be to operate for an extended period of time,” said Vincent Parisi, president of Northern Indiana Power Service Co.

And like Craig, these clunkers force families and businesses to pay higher bills. The cost of running the Schafer and Culley coal generators affected by the DOE’s order increased by 66 percent and 17 percent, respectively, between 2021-2024.

“The federal government’s order to force extremely expensive and unreliable coal units to stay open will result in higher bills for Hoosiers who are already reeling from record-high rate increases in 2025. We can’t afford this costly and unfounded federal overreach,” said Ben Inskeep, program director at the Citizens Action Coalition of Indiana.

Interior Department kneecaps offshore wind

Meanwhile the Interior Department forced five under-construction and already permitted offshore wind projects to pause operations. Some projects were more than 80 percent complete and mere weeks away from sending power to the grid.

Interior’s actions threaten $25 billion dollars of investment, 10,000 jobs, and enough new electricity to power 2.5 million homes.

Legal challenges quickly followed this federal order. Equinor, one of the affected project developers, noted in its filing “[T]he Interior Department’s Bureau of Ocean Energy Management ordered it to halt work ‘with no meaningful explanation or attempt to first engage Empire Wind in addressing new concerns that it alleges have arisen… The United States’ non-explanation for its about-face is as hollow as it is pretextual.”

Other project developers note similar experiences. In its own legal filing, Orsted claims “Company officials met with officials at BSEE and Interior’s Bureau of Ocean Energy Management on Dec. 23. During that and prior meetings during 2025, neither agency “raised any national security concerns related to the project.”

Interior claimed the construction pause was due to national security concerns, but project permits were only issued “following years of review by state and federal agencies, including the Coast Guard, the Naval Undersea Warfare Center, the Air Force and more.”

“The record of decisions all show that the Department of Defense was consulted at every stage of the permitting process,” said national security expert and former Commander of the USS Cole Kirk Lippold.

Forcing decades-old dying plants to remain open under the guise of a reliability crisis while halting perhaps the largest collection of new electricity generation in the country, some of which would have been operational in a matter of weeks, is a level of 3-D chess most Americans are clearly not equipped to comprehend.