West Virginia Utilities Defend Coal Fleet Against PJM Dispatch Rules
State regulators and utilities are lobbying to keep aging coal plants running despite higher costs and grid congestion, aiming to secure local reliability and extend asset lifespans through federal partnerships.
West Virginia officials and utility executives are coordinating efforts to maintain the operational status of the state’s aging coal-fired power plants. The joint committee heard testimony from the Office of Energy, the Public Service Commission, and the state’s two major electric utilities regarding the necessity of keeping these assets online for the regional PJM Interconnection grid. The central argument is that these plants must continue to provide base-load energy to ensure reliability for local customers, even as they face economic and technical headwinds.
Nicholas Preservati, deputy secretary of the state Department of Commerce, highlighted the state’s role in the 13-state Governors' Collaborative, which is intervening with the Federal Energy Regulatory Commission to reform PJM governance. He criticized emergency rules that force local coal plants to throttle down due to west-to-east transmission congestion. Preservati also pointed to rapid plant cycling as a factor that shortens equipment lifespans, stating that the state is working with federal partners to protect its interests within the regional market structure.
Coal Costs Outpace Natural Gas Alternatives
The economic viability of coal in the PJM dispatch hierarchy is constrained by cost differentials. A 2025 analysis by financial firm Lazard indicates that coal-fired power costs consumers $122 per megawatt hour, compared to $78 per megawatt hour for natural gas. Because PJM coordinates wholesale electricity movement by dispatching the least expensive fuel sources first, natural gas and nuclear power frequently precede coal in meeting base-load demand. This cost structure means coal is not always selected for dispatch, regardless of its reliability profile.
Utilities Invest in Plant Modernization
FirstEnergy has invested $500 million over the last five years in its two in-state coal-fired power plants, Fort Martin and Harrison. Appalachian Power has secured over $87 million in federal grants and $116 million in low-interest loans for modernization projects, including work at the Mitchell Power Plant in Marshall County. These investments are aimed at extending the operational life of assets that are approximately 50 years old, a fact emphasized by David Ellis, director of quality assurance at the Public Service Commission.
Ellis stated that maintaining and updating these plants is critical for local service, independent of their performance in the PJM market. The state is also working with the National Energy Technology Laboratory in Morgantown to utilize computing research for determining necessary upgrades. This collaboration aims to analyze every process affecting the coal plants to identify improvements that enhance efficiency and longevity.
New Dispatch Rules Require Cost Optimization
The Public Service Commission is implementing consumer economic dispatch rules mandated by House Bill 2014, a 2025 law addressing data centers and microgrids. These rules require utilities to maintain plants to run at their lowest possible cost, targeting a 69% capacity factor when economically feasible. The proposed rules are currently out for public comment, with a hearing scheduled for September 28 at the PSC's headquarters in Charleston.
According to Ellis, consumer economic dispatch involves maintaining each power plant based on its specific engineering and transmission limitations to ensure it operates at the lowest cost. The commission expects to review public comments and issue amendments within the next one to two months. This regulatory framework seeks to balance grid reliability with economic efficiency for West Virginia’s ratepayers.
