Consultancy Group Downgrades Coal Plant Retirement Projections

ICF International, a consultancy group that earlier this year predicted 68 GW of coal-fired power plants could retire by 2030 as a result of finalized and proposed regulations from the Environmental Protection Agency (EPA), downgraded its retirement projections to 50 GW in mid-October. In the interim, the group revised its estimate to 51 GW in a story written for POWER’s May issue, " Added Regulatory Hurdles Will Accelerate Coal Plan Retirements."

In its first-quarter Integrated Energy Outlook report, the group had said 68 GW of coal-fired retirements could occur as a result of the EPA’s Cross State Air Pollution Rule (CSAPR), the proposed Air Toxics Rule, coal combustion residuals, and cooling water intake structure standards. In the newly released third-quarter report, the company revised its findings based on deeper analysis of the rules, saying that “Although the combined impact of the rules remains uncertain, the regulations could lead to a total of approximately 50 GW of coal plant retirements, including those retirements announced to date.”

The report also tackles assumptions that the rules will “severely impact” U.S. coal production. “ICF projects that U.S. coal production and prices will remain stable,” it said. “In particular, demand for low sulfur Powder River Basin coal and low-cost, high-sulfur Illinois Basin coal is expected to be strong.”

Shale gas production will grow at a rapid pace, but natural gas prices will remain low in the near term until emissions rules spur more gas demand growth in the power sector, the group believes. “Despite the continued growth in natural gas use, the study finds that escalating renewable portfolio standards in California and the eastern U.S. will lead to continued growth in renewable generation capacity and firming renewable energy credit (REC) market prices,” it said.

—Sonal Patel is POWER’s senior writer. This content first appeared in POWERnews.

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