A new study evaluating Kentucky’s electricity needs shows that new state laws are hindering a transition to a cheaper, cleaner and more dependable energy portfolio — at a time when many Kentuckians are struggling to afford their utility bills. The study compares multiple energy pathways through 2050 and concludes that replacing aging coal-fired power plants with a mix of renewable energy, battery storage and efficiency investments could save Kentuckians billions while maintaining reliability.
The study also analyzes the impacts of Kentucky Senate Bill (SB) 4 (2023) and SB 349 (2024), state laws that make it harder to retire aging coal-fired power plants and replace that energy generation capacity with renewable resources. The study finds that these laws are inhibiting the development of cheaper and cleaner energy alternatives, and causing further challenges in dependability and affordability of electric generation by Kentucky’s utilities.
Using detailed power-system and economic modeling through 2050, the researchers found that continued reliance on coal-fired power plants is no longer the least-cost option when compared to an energy portfolio that includes deployment of renewables and efficiency strategies at significantly higher levels than currently planned by Kentucky’s regulated electric utilities. The least-cost option for Kentucky’s energy future is one that transitions away from coal generation, does not include the buildout of new gas-fired resources and could save electricity customers $2.6 billion through 2050. When potential carbon-related compliance costs are included, the savings grow even larger.
The independent analysis was commissioned by Kentucky Resources Council (KRC), Mountain Association, Metropolitan Housing Coalition and Earthjustice.
“Energy costs have direct economic, environmental, and health impacts on low- and fixed-income households,” said Tony Curtis, Executive Director of the Metropolitan Housing Coalition. “This report shows that Kentucky’s future isn’t in doubling down on outdated coal-fired power or turning to new gas generation, but in a least-cost portfolio of renewables, storage, and demand-side resources. Rising utility costs threaten housing affordability, and these findings make clear it’s time for legislative and regulatory leaders to reassess the path forward.”
The study further demonstrated that a more modern and diverse energy portfolio would strengthen Kentucky’s grid resilience during periods of extreme heat or cold, when older, inflexible fossil units are more likely to fail.
Robin Gabbard, President of Mountain Association said, “Aging coal units are no longer the cheapest way to keep the lights on, especially when extreme weather puts added strain on the grid. Modernizing Kentucky’s energy system will strengthen reliability, prevent outages and help families and businesses to thrive — no matter the weather.”
Cassandra McCrae, Senior Attorney at Earthjustice, emphasized the cost impacts of delaying the transition: “Preventing skyrocketing costs for ratepayers in the coming years requires replacing these costly coal plants with cleaner, renewable resources as soon as possible. When Kentucky laws block the retirement of uneconomic coal plants and block building new renewable resources, they are raising every household in the state’s electricity bill.”
The report also demonstrates that 95% clean energy can be achieved by 2050 with $1.6 billion in savings over the current baseline portfolio, but only if Kentucky electric utilities start now to change their paths.
“Kentuckians deserve energy decisions grounded in facts, not assumptions,” said Ashley Wilmes, Executive Director of KRC. “This report demonstrates that Kentucky can chart a cleaner, more reliable, more fair energy future. Propping up uneconomic power from an aging fleet of coal-fired plants raises risks and costs for Kentucky families and businesses. A more diverse portfolio grounded in renewable energy, battery storage, and energy efficiency can produce and maintain the reliable, least-cost electricity going forward that has long been one of the Commonwealth’s greatest economic advantages.”
Download the full report at kyrc.org/energy-report-pdf.
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