Bill to make it harder to retire Kentucky’s fossil fuel power plants nears passage
A Republican bill to form a group tasked with ensuring Kentucky’s coal plants “aren’t retired too quickly” by creating a series of regulatory hurdles for companies aiming to close those plants got a step closer to final passage Thursday.
Senate Bill 349 from Sen. Robby Mills, R-Henderson, would create an 18-member Energy Planning and Inventory Commission, along with an executive board wielding authority over the panel. Part of its role: Review requests to close fossil fuel-fired power plants before the state’s Public Service Commission can approve or deny such a retirement.
The bill, having received support largely along party lines, now heads to the House for floor votes — one of the last steps before final passage.
The commission’s recommendations would not be binding, but it would likely extend the overall timeline between application and retirement of plants. It builds off another bill introduced by Mills that passed last session, Senate Bill 4, that made it harder to retire coal-fired power plants.
In addition to creating a statewide energy policy, Senate Bill 349 would enshrine that a utility cannot retire an old coal-fired power plant “until a replacement unit is fully constructed, permitted and in operation,” Mills told members of the House Standing Committee on Natural Resources and Energy Thursday morning.
Mills, along with fellow co-sponsor Senate President Robert Stivers, said the point isn’t necessarily to keep coal plants afloat, but to examine what are truly the state’s most economical and reliable energy options going forward, as the state’s electric energy grid will only continue to experience more strain.
“We are naturally an energy consumption universe based on fossil fuels,” Stivers said. “There’s no doubt we’re in a period of transition, but the question is how fast should we transition?”
Bill opponents don’t buy it.
Louisville Gas & Electric and Kentucky Utilities President John Crockett said the commission “is neither configured nor intended to be an unbiased group formed with the purpose of considering Kentucky’s energy future.”
Though it claims to “promote reliability, it is instead stacked with special interests almost entirely without expertise in forecasting generating or delivering electric energy to Kentucky customers,” said Crockett, who also opposed last year’s Senate Bill 4.
LG&E and KU are “coal’s biggest customer in the state.” But extending the life of a no-longer economical coal plant doesn’t make fiscal sense, and it will cost ratepayers more, nor is it environmentally sustainable.
“We will be using coal for years and years to come, but we are obliged to be agnostic in our choice of fuel,” Crockett said. “When (coal) units reach the end of their useful economic lives, we seek to retire and replace them with new generation, (which is) highly efficient.”
Crockett suggested the bill sponsors’ public presentation of the bill was misleading.
“Sponsors of the bill say it is not a coal-focused issue, and yet the bill says, ‘further retirement of fossil fuel-fired electric generating resources is not necessary for the protection of the environment, or the health, safety and welfare” of Kentuckians, Crockett said, quoting from the bill’s language.
“Of course it’s a coal issue,” he added.
After Crockett and Duke Energy President Amy Spiller finished their testimony opposing the bill, Committee Chairman Rep Jim Gooch, R-Providence, a vocal coal proponent, said aged coal-fired power plants are “probably as reliable as solar power when the sun’s not shining and wind power when the wind’s not blowing.”
Although bill sponsors have insisted the measure is not only about coal, the bill has major backers in the coal industry. Dependable Power First Kentucky, an arm of the coal industry-supporting group America’s Power, has been a strong public advocate for the bill.
Crockett also testified in opposition to the bill earlier this month in a Senate committee, where Mills said the federal government was “intentionally sabotaging” the national grid by allowing “radical environmentalists” to steer energy policy. Senate Bill 349, he says, adds a buffer between state and national energy policy.
The commission would be administratively attached to the University of Kentucky Center for Applied Energy Research. Its 18-member body would be comprised of:
Three people tied to the coal industry, including a coal producer, transporter and buyer/seller.
Two from the oil and gas industry.
One from an investor-owned utility.
One from an electricity generation and transmission co-operative.
Two from the nuclear power industry.
One representing commercial and industrial electric consumers.
One representing producers of renewable electricity.
One nominated by the chief executive officer of the Kentucky Chamber of Commerce.
One investment banker or utility financier.
One representing residential electricity consumers.
One representative each from the Energy and Environment Cabinet and the Cabinet for Economic Development.
One non-voting member each from the House and Senate.
Crockett on Thursday criticized the commission’s make-up for only containing two spots for people “who actually have obligation to deliver electricity to Kentucky customers.”
Coal power generation is declining in Kentucky, but it still made up a majority of all generation in the state in 2022, according to the U.S. Energy Information Association. That year, about 68% of Kentucky’s utility-scale electricity net generation was coal-fired.
That was the third-highest percentage of any state, trailing West Virginia and Wyoming.
Rep. Tom Smith, R-Corbin, said the work of the commission, which will weigh the costs of energy transition, is long overdue.
As he understands it, the goal isn’t to “rule out any type of energy,” he said to the bill sponsors, but to ensure Kentucky has the biggest bang for its buck.
“Fossil fuel is a part of that right now, and we (shouldn’t) just clip our wings.”
But Crockett said if that was truly what Republicans envisioned with the commission, its member makeup would look quite different.
“We welcome the legislature creating a legislative working group to look at these important energies holistically, but we do strongly oppose the creation of a special interest group invited to opine every time a coal unit reaches the end of its useful economic life,” he said.
A stand against EPA regulations
After the committee moved on Senate Bill 349, they quickly approved House Joint Resolution 121, which seeks to make Kentucky a “sanctuary state” from the Environmental Protection Agency’s “overreaching regulatory actions on fossil fuel-fired power plants.”
That resolution, sponsored by Rep. Gooch, says the EPA has a “history of regulatory overreach,” including the 1970 Clean Air Act, which the resolution says has spurred the “premature closure of fossil fuel-fired power plants” and “led to increased energy prices and a less reliable and resilient electric grid in the Commonwealth.”
Gooch and other sponsors bristled at federal requirements to curb greenhouse gas emissions from coal plants and set forth in the resolution that, moving forward, air quality standards “shall not be subject to federal regulation.”
Instead, the Kentucky Energy and Environment Cabinet shall be the primary arbiter of environmental regulations.
In committee, Gooch acknowledged that passage of the resolution may lead to the federal government taking “primacy away from us and taking over our enforcement of environmental law,” he said. “They will do that.”
But the point is to drive home a formal resistance to a government that Gooch says chooses which laws to enforce. He then generally referenced federal immigration laws that he says aren’t being enforced by the Biden Administration at the U.S.-Mexico border.
“This (bill) is going to pass this committee, (and while) it may not go much further than that, we are making a point saying we cannot have a government that picks and chooses which laws to enforce,” he said.
Democrats maligned the resolution. Rep. Lindsey Burke, D-Lexington, called it “completely embarrassing.”
Rep. Al Gentry, D-Louisville, called it a “ridiculous motion. I think it’s a clear statement that we don’t really care about clean air.”
In a news conference Thursday afternoon, Gov. Andy Beshear called the resolution “playing politics.”
The governor noted how Gooch admitted the EPA is likely to “take over regulation in Kentucky” should the state try and enforce the resolution.
“So, it’s saying, ‘I don’t like this big, bad group in the federal government, so I’m going to do something that gives them control of our regulations in the state. It’s silly,” Beshear said. “If the joint resolution is about overreach by the EPA, why would you do something that puts the EPA in charge?”
Herald-Leader reporters Austin Horn and Tessa Duvall contributed to this story.
