Consumers Energy will stop burning coal by 2025

TRAVERSE CITY, Mich. - Consumers Energy said Wednesday it would stop burning coal to generate electricity by 2025, relying instead on natural gas and renewable energy sources in a push to continue reducing its planet-warming carbon emissions.

The Jackson-based utility, which provides power or gas to homes and businesses across Michigan's Lower Peninsula, said ending its coal use 15 years earlier than previously planned was part of a long-term strategy to produce energy in a more environmentally friendly way.

"It allows for a cleaner future, an affordable future for all our customers, and ensures reliability," said Garrick Rochow, president and CEO.

Approval from the Michigan Public Service Commission will be needed to carry out the plan, under which Rochow said Consumers would rely on clean sources for 90% of its energy output by 2040, including 8,000 megawatts of solar power.

The plan calls for retiring all three coal-fired units at the Campbell generating station near Holland, Michigan, in 2025. Units 1 and 2 would close six years sooner than previously scheduled and the third unit 15 years early.

Additionally, two units at the Karn plant near Bay City, Michigan, that run on natural gas and fuel oil would close in 2023 — about eight years earlier than their intended life span.

Solar, wind and other renewable sources will make up more than 60% of the utility's electric capacity by 2040, officials said. Combining that with advances in storage and efficiency should enable Consumers to produce 90% of its energy from clean sources, they said.

With the coal phaseout, natural gas will become the fuel source for generating baseline power.

The utility plans to buy four Michigan gas-fired plants. They include the Covert Generating Station in Van Buren County; Dearborn Industrial Generation in Wayne County; Kalamazoo River Generating Station in Kalamazoo County; and Livingston Generating Station in Otsego County.

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State and federal approval would be required for the purchases, which would augment Consumers' gas-powered plants in Zeeland and Jackson.

Production of 8,000 megawatts of solar energy, already underway, will continue throughout the 2020s, officials said. Consumers operates solar plants at Western Michigan University, Grand Valley State University and in Cadillac and purchases solar generation from several sites elsewhere in the state.

Environmental groups have pressured Consumers to quicken the pace of its transition from coal and appealed this week for shutdown of the third Campbell unit.

"It's really encouraging that they're going to be phasing out their coal and increasing the amount of renewables they'll be using to meet their generation needs," Derrell Slaughter, Michigan clean energy advocate for the Natural Resources Defense Council, said Wednesday.

He said the group would study the plan more closely and offer comments as the Public Service Commission considers it.

One immediate concern is the extent to which Consumers would rely on natural gas, which emits carbon dioxide, although less than coal does, Slaughter said.

Rochow said as solar, wind and battery storage technology develops, it's necessary to keep a baseline fossil fuel in the mix.

"We need that flexibility, that reliability, that comes with natural gas," he said.

Switching to gas as a baseload fuel would save customers about $650 million through 2040 compared to what they would pay under utility's present plan, said Brandon Hofmeister, senior vice president for governmental, regulatory and public affairs.