When Secretary of Energy Chris Wright used emergency authority to extend the life of the J.H Campbell coal plant in Michigan at the end of May, the decision was met with a broadside of a criticism. To the anti-coal crowd, the move was a bail out, a solution in search of a problem and a ratepayer boondoggle.  

But two months on, there’s quite of bit of crow to be had and it’s not the Secretary of Energy who will be doing the eating.

The decision to extend the life of the plant was made to bolster grid reliability on the Midcontinent Independent System Operator (MISO) grid which has seen its reserve margins erode into dangerous territory. And bolster the grid is exactly what J.H. Campbell has done.

While the Secretary’s order ensured the plant must be available during the summer, whether it dispatched power would be based entirely on need and economics. With data starting to come in for plant operations through June, we now have our answer.

Not only was J.H. Campbell needed, it was all but irreplaceable in helping MISO navigate an oppressive heatwave that forced operators to initiate a maximum generation event, calling upon every megawatt of power available to keep the lights on and ACs running.

During the heatwave, the 20^th through the 24^th of June, the largest unit at J.H. Campbell – which can generate nearly 800 megawatts of power – was running full out. In total, the plant was pumping more than a gigawatt of power onto the MISO grid as operators scrambled for generation.

The plant wasn’t just needed during the heatwave. During the full month, J.H. Campbell ran at a capacity factor of 66%.

Saving the Grid and Ratepayers Money

While critics were adamant the plant wouldn’t be needed this summer and that it would be a financial burden, just the opposite is true.

Not only has the plant buttressed MISO’s razor-thin supply of power, but publicly available data shows the plant has in fact saved ratepayers money.

Consumers Energy, the plant owner, reported that its cost to operate the plant for five weeks, from the last week of May through the end of June, was $29 million. Journalists and NGOs alike scrambled to write variations of headlines suggesting that the Trump administration’s action was fleecing the average ratepayer. But the real math tells a different story. The energy revenue from plant for the same period, however, was about $33.7 million. The operation of the plant is more than paying for itself.

MISO ratepayers will have likely realized a savings of at least $4.7 million, and perhaps far more. Power prices in the region would have been far higher if not for 1,000 megawatts of capacity provided by J.H. Campbell.  

The cost savings afforded by J.H. Campbell are icing on the cake. The plant was ordered to stay online to support reliability and backstop the region’s power supply. The cost – and danger – of rolling blackouts if the plant wasn’t available is the metric that truly matters.

While J.H. Campbell has more than risen to the occasion, the same cannot be said for other sources of generation on the MISO grid. At times this summer, J.H. Campbell alone, producing more than a gigawatt of power, has rivaled the output of MISO’s entire 30 GWs of nameplate wind capacity.

J.H. Campbell and MISO’s coal fleet have met the moment during soaring summer demand. “This is an incredible case study for the value of existing capacity,” said Rich Nolan, president and CEO of the National Mining Association. “The nation’s power supply is being stretched to its very limit and the resources the anti-coal movement said could shoulder the load simply aren’t up to the challenge. The facts are simple: demand is soaring, grids are strained, and we have existing coal plants ready to ramp up,” he added.

The Department of Energy has stepped up to the plate and responded to the urgent warnings of the nation’s reliability regulators and grid operators. Secretary Wright’s decision to keep J.H. Campbell running has been nothing short of a triumphant success.