By Steven Allan Adams
For The Intelligencer
Charleston – The West Virginia Senate passed a bill overwhelmingly Friday to encourage coal-fired power plants to produce more electricity, but some senators were concerned the bill could fall back on electric ratepayers to cover the possible increased costs.
The state Senate passed House Bill 4026, the West Virginia First Energy Act, in a 32-2 vote Friday afternoon after nearly an hour of discussion.
The bill now heads back to the House of Delegates to either concur with the Senate’s changes to the bill or reject those changes.
HB 4026 would encourage electric utility companies to reach a 69% operational utilization rate for coal-fired power plants by offering financial incentives tied to cost recovery. This standard does not apply to natural gas-fired generation, which is classified as a “load-following and reliability-balancing resource.”
The act also mandates that electric utilities incorporate advanced transmission technologies and maintain a 30-day fuel supply to ensure grid reliability.
“There is a war on coal going on in this state and in this country, whether the people want to hear that or not,” said Senate Energy, Industry and Mining Committee Chairman Chris Rose, R-Monongalia. “It incentivizes something the taxpayers of this state already paid for: West Virginia’s coal-fired power plants. It is much cheaper to keep the car you own and put gas in it than it is to buy another one to put gas in that tank. That’s how this lowers rates.”
The bill requires electric utilities to submit detailed findings identifying feasible technological upgrades to improve performance and extend the life cycle of coal-fired power plants.
Monthly utilization data must be reported to both the West Virginia Public Service Commission (PSC) and the state Public Energy Authority (PEA).
While already required under law, the bill forbids utilities from retiring or deactivating coal or natural gas facilities without prior approval from the PSC and PEA except under specific circumstances, such as a finding that the retirement will not increase retail rates or wholesale market volatility or having replacement resource of equal or greater capacity already operational on the grid.
The bill’s supporters, such as state Sen. Brian Helton, blamed the decisions of PJM Interconnection-a wholesale energy transmission company serving West Virginia, 12 other states, and Washington, D.C.–for not making better use of West Virginia’s nine active coal-fired power plants.
Helton cited a previous PSC order that set an expectation that coal-fired power plants need to achieve at least a 69% capacity factor in order for in-state electric companies to self-generate power and reduce reliance on purchased power.
“We’ve looked at where we would be right now if, in fact, our coal-fired plants here across our state that are run by our monopolistic utilities would do what the PSC has asked them to do,” Helton said. “Unfortunately, even though we own these coal-fired plants … decisions are made outside of our state that are not in West Virginia’s best interest.”
A 2024 report published by PEA found that while electric utility rates for PJM ratepayers were at a 20-year high, coal-fired power plants owned by Columbus-based American Electric Power-with WV subsidiaries Appalachian Power and Wheeling Power-were at their lowest generation in 20 years.
According to that report, Mitchell Power Plant in Marshall County operated as high as 49% capacity factor in 2021 and as low as 6%. The John Amos Power Plant on the border of Kanawha and Putnam counties operated at between a 59% capacity factor and 3% capacity factor. And the Mountaineer Power Plant in Mason County operated at between a 29% capacity factor and a 0%.
PJM coordinates the movement of wholesale electricity, dispatching the power it needs for the regional grid based on a minute-by-minute basis using the least expensive fuel sources first, such as natural gas, nuclear, then dispatching coal and renewable energy sources as needed. American Electric Power and Akron-based FirstEnergy-with West Virginia subsidiaries MonPower and Potomac Edison-serve the bulk of West Virginia.
Supporters of HB 4026 also see it as a way to bolster the coal industry in the state, creating a demand for the steam coal needed for power plants and putting thousands of coal miners to work.
“Does anybody in this assembly here believe that West Virginia is better off when we don’t utilize our coal industry,” said state Sen. Scott Fuller, R-Wayne. “I personally think that we can’t go wrong using the one thing that we have that is more abundant than any other state in this nation, and that’s coal … we have a prime opportunity right now to really invest in the coal industry and really set ourselves apart.”
But opponents of the bill questioned the economics of HB 4026, citing West Virginia’s declining population over the last 50 years for being the largest driver of increasing electric rates in the state.
According to the U.S. Energy Information Administration, electric rates for residential customers rose by an average of 34% between 2019 and 2024.
Lawmakers questioned whether putting pressure on utilities to operate their coal-fired power plants closer to 69% when there was no demand for the electricity on the regional grid would backfire and cause electric rates to skyrocket on West Virginians.
“I’ve been torn on this one the whole time because I have a hard time wrapping my head around if we’re going to increase the fuel expense, and how we decrease rates for people in West Virginia,” said state Sen. Eric Tarr, R-Putnam. “I really hope we can go in and say, look how much these rates went down because of how many people flew into West Virginia … but here’s what I think is going to happen. I think we’ll go in and we’re going to see those rates spike.”
“If you raise the cost of energy, which this bill will do, you are going to pass that on to the people that live here and work here. That’s the only way it goes,” said Senate Minority Leader Mike Woelfel, D-Cabell. “This is a bad bill for the citizens and residents of our state. They will bear the brunt, and coal producers will reap the benefit.”
Read more from The Intelligencer, here.
