Campbell Coal Plant: Closure Plan, Emergency Orders, and Costs

A federal appeals court vacated the first order keeping Michigan’s J.H. Campbell coal plant open. Consumers Energy had proposed retiring the plant under a state-approved plan to replace its electricity supply. Later federal orders and the question of who pays for continued operation remained separate disputes.

Consumers Energy proposed retiring Campbell’s three coal-burning units by May 31, 2025. The Michigan Public Service Commission approved a negotiated electricity-supply plan on June 23, 2022, in case U-21090. This was the utility’s retirement proposal, approved through state regulation; it was not a federal order to close the plant. Consumers described the plan as a way to end coal use earlier, reduce emissions and save customers an estimated $600 million through 2040 compared with its earlier plan.

The replacement plan specified how electricity would be supplied: acquire the Covert natural-gas power plant; keep the D.E. Karn units 3 and 4, which use natural gas and oil, available through May 2031; purchase electricity capacity from other suppliers; and add solar power and battery storage over time. The plan included about 8,000 megawatts of solar power by 2040, with battery storage targets of 75 megawatts by 2027 and 550 megawatts by 2040. These are power-capacity figures, not amounts of electricity produced. Consumers began operating Covert in June 2023; the longer-term additions were not all scheduled to exist when Campbell retired.

Energy Secretary Chris Wright issued the first emergency order on May 23, 2025, directing Consumers Energy and the Midcontinent Independent System Operator, or MISO, to keep Campbell available. MISO operates the regional electricity market and grid. The Department of Energy said summer demand, power-plant retirements and periods of low renewable output created blackout risks. Wright’s August 14, 2026 order covered August 17 through November 14, 2026 and directed economical operation when MISO needed the plant.

“whenever the Commission determines that an emergency exists by reason of a sudden increase in the demand for electric energy” 16 U.S.C. § 824a(c), excerpt; emergency power authority

On September 11, 2026, a unanimous D.C. Circuit panel vacated the May 2025 order in Michigan v. Department of Energy, No. 25-1159. The court held that the emergency provision did not authorize overriding ordinary long-term planning on the record presented. It discussed MISO’s projected 9.8% summer 2025 reserve margin and the planning review already undertaken. A reserve margin measures available capacity above expected peak demand; it does not guarantee that outages can never occur. The decision addressed the first order. It did not automatically decide the challenges to every later order or settle the separate cost-recovery proceedings.

Michigan Attorney General Dana Nessel challenged DOE’s intervention and said the state-approved replacement plan could serve customers without Campbell. After the September ruling, her office said it concerned the first order and that the latest extension still ran through November 14. Reuters reported that Consumers was reviewing the ruling while continuing under the current order.

Consumers’ second-quarter 2026 SEC filing reported a $259 million net financial impact through June 30, after applying $239 million in MISO revenues. Michigan’s attorney general separately cited $295 million in costs for the period from May 2025 through June 2026. Consumers sought recovery through the Federal Energy Regulatory Commission, or FERC, including allocation across MISO’s North and Central regions. The filing described pending approval of a revised allocation proposal and a separate recovery request for the initial order.

Sources

AI generated report by Explorvia.com.