Utilities have made “some” overall progress shifting away from coal- and gas-fired generation towards clean power supplies, but have only committed to retiring 30% of their coal-fired power generation by 2030, the Sierra Club said in a report released Wednesday.
“Utilities have kicked the can down the road for years, giving themselves a narrower window to plan for coal retirement and build the clean energy resources, including generation, transmission, and demand-side options, needed to replace it,” the Sierra Club said in its fourth The Dirty Truth About Utility Climate Pledges report.
In the report, the Sierra Club scores utilities based on their plans to retire coal-fired power plants by 2030, build gas capacity through 2035 and build wind and solar generation through 2035. The report reviews the top 50 fossil-fuel owning utility companies.
Overall, utilities scored 29 points out of 100, up 12 points since the Sierra Club issued its first “Dirty Truth” report four years ago.
“That improvement needs to be faster, and leadership from a handful of utilities demonstrates that realistic planning for a clean energy transition is possible,” the Sierra Club said. “We also have strong public and governmental support to bolster utilities’ ability to transition.”
Since 2021, almost two-thirds of the utilities the Sierra Club reviewed have improved their score, but one-third of them made no progress or received a lower score than in the first report, the environmental group said.
The utilities covered in the report plan to retire 58 GW of coal-fired capacity by 2030 out of 148 GW that they own, according to the Sierra Club. They also plan to build 93 GW of gas-fired generation by 2035, the group said.
Utilities also plan to build a record-setting amount of clean energy capacity through 2035 that could produce 626 million MWh, enough to replace about half of the existing fossil-fuel generation, according to the report.
Ten utility companies aim to meet the Biden administration’s goal of 80% emissions-free electricity by 2030, the Sierra Club said.
NiSource was the only parent utility company to receive an A grade in the Sierra Club’s ranking. NextEra Energy, Orlando Utilities Commission, PNM Resources, Puget Holdings, The AES Corp. and Xcel Energy received Bs.
The Sierra Club gave out 15 Fs, including to Evergy, FirstEnergy, PPL, Southern Co. and WEC Energy Group. Six utility companies received Ds — including Cleco Partners, Duke Energy, Portland General Electric and the Tennessee Valley Authority.
The Sierra Club urged utilities to include Inflation Reduction Act tax incentives in their resource planning modeling. “Utilities have not adequately modeled the far-reaching implications of the law, leaving money on the table and increasing costs for customers,” the group said.
Utilities should also open their resource planning processes to greater public participation, which would allow for more ideas and solutions to be considered, the Sierra Club said.
The power sector accounted for 25% of U.S. greenhouse gas emissions in 2022, making it the second largest emissions source behind the transportation sector, according to the Environmental Protection Agency.
The U.S. power sector produced 4,807 million metric tons of carbon emissions last year, down 7% from 2022 levels, according to the U.S. Energy Information Administration. The reduction in emissions was caused largely by reduced coal-fired electricity generation, the most carbon intensive fossil fuel, as natural gas and solar power made up a larger portion of the generation mix, the agency said in an April report.
Investor-owned utilities are leading the clean energy transition and aim to achieve their emissions reduction goals in a way that is consistent with the pace of technology development and with their responsibility to prioritize customer affordability and reliability, said Sarah Durdaller, a spokesperson for the Edison Electric Institute, a trade group for IOUs.
“If the Sierra Club truly wants to accelerate the deployment of clean energy, we urge them to consider joining with the other environmental, industry, and government leaders who are working together constructively to identify ways to overcome the barriers to building the transmission and other energy infrastructure we clearly need in order to deliver more resilient clean energy to customers,” Durdaller said in an email.