Utilities are grappling with an unshakeable reality: they can’t meet soaring power demand without the existing coal capacity they have.

One after another, utilities are dropping plans to close plants or are kicking retirements far down the road. Deliberately removing dispatchable capacity from grids at the same time they are facing record breaking—and growing—electricity demands, would be an own goal that defies logic.

Just this summer, three more utilities have joined the ranks of those pumping the breaks on plant retirements.

New Mexico’s 1,500 Megawatt (MW) Four Corners coal power plant, which had been scheduled for retirement in 2031, will now operate until 2038. Arizona Public Service (APS), the majority owner of the plant, said “in short, coal is an important part of our balanced energy mix today, and we will not exit it any earlier than is in the best interests of our customers to ensure reliable service at the lowest cost possible.”

APS had committed to the early retirement of the plant just two years ago – even exploring ways to close the plant earlier than 2031 – but an unprecedented surge in demand has changed APS’ plans. APS now forecasts it will have to add 60% more generating capacity by 2038 to meet projected peak demand. Just last week, APS set a new peak demand record—the third time this summer that has happened.

The story is much the same in Kentucky where Louisville Gas & Electric and Kentucky Utilities announced on July 29 their plans to extend the life of the Mill Creek coal power plant, citing “record-breaking economic development needs,” notably from data centers. The utilities now expect up to a 45% jump in demand in less than a decade. 

The planners at the Tennessee Valley Authority are following the trend. TVA had been planning to close all its coal power plants by the year 2035 but that timeline is now out the window. TVA is seeing “explosive growth across our region.” And you guessed it, rapid AI data center development is a leading driver. TVA sees 11 GW of new demand on the horizon, the equivalent of the power needed to for 6 million homes, roughly one-third of TVA’s entire power grid. 

These three recent announcements add to a list of at least 40 other coal-fired power plants that have delayed closures in just the past three years.

Coal Demand is Up

Rising power demand is already being met by coal. The U.S. Energy Information Administration recently projected a 6% increase in U.S. coal consumption for 2025. On some grids, the rise is far more pronounced.

On the Midcontinent Independent System Operator grid, which stretches up the Midwest from Louisiana to Minnesota, coal generation has eclipsed year prior totals for eight straight months. In July, it was 17% higher from a year earlier.

On the PJM grid next door, the nation’s largest, coal demand is also up, and a recent capacity auction confirmed what the grid operator has been warning for years: the grid simply can’t meet soaring demand if it loses any more coal capacity.

After jumping 800% a year prior, capacity prices across PJM hit a newly installed price cap this summer—a clear signal to bring new capacity to market but an even clearer signal not to retire any existing capacity. PJM’s newly updated demand forecast sees 32 GW of new demand by 2030, with 30 of it coming from data centers.

As Mark Christie, the outgoing Chairman of the Federal Energy Regulatory Commission, told The Washington Post earlier this year, “coal is going to be around for longer than people thought. Because coal is a key component of keeping our lights on and our heat pumps running.” He added, “We’re going to need all these resources. We’re going to need uprated nuclear, we’re going to need more combined-cycle gas, and we’re going to need to keep the existing coal plants running.”