A evaluate new study Kentucky’s electricity needs show that new state laws are hindering a transition to a cheaper, cleaner and more reliable energy portfolio – at a time when many Kentuckians are struggling to pay their energy 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 impact of Kentucky Senate Bill (SB) 4 (2023) and SB 349 (2024), state laws that make it more difficult to retire aging coal-fired power plants and replace that energy generation capacity with renewable sources. The study finds that these laws hinder the development of cheaper and cleaner energy alternatives and create further challenges to the reliability and affordability of electricity generation by Kentucky utilities.
Using detailed energy system and economic models through 2050, the researchers found that continued reliance on coal-fired power plants is no longer the cheapest option compared to an energy portfolio that includes the deployment of renewables and efficiency strategies at significantly higher levels than currently planned by Kentucky’s regulated electric utilities. The cheapest option for Kentucky’s energy future is one that moves away from coal generation, does not include the buildout of new gas-fired sources and could save electric customers $2.6 billion through 2050. When potential carbon-related compliance costs are included, the savings become even greater.
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 for low- and fixed-income households,” said Tony Curtis, executive director of the Metropolitan Housing Coalition. “This report shows that Kentucky’s future lies not in doubling down on legacy coal-fired power or transitioning to new gas generation, but in a portfolio of the lowest-cost renewables, storage and demand-side resources. Rising energy costs threaten housing affordability, and these findings make clear that it is time for legislative and regulatory leaders to reassess the path forward.”
The study further showed that a more modern and diverse energy portfolio would strengthen the resilience of Kentucky’s electric grid during periods of extreme heat or cold, when older, inflexible fossil fuel units are more likely to fail.
Robin Gabbard, president of the Mountain Association, said, “Aging coal-fired power plants are no longer the cheapest way to keep the lights on, especially when extreme weather puts additional strain on the electric grid. Modernizing Kentucky’s energy system will strengthen reliability, prevent outages and help families and businesses thrive – no matter the weather.”
Cassandra McCrae, senior attorney at Earthjustice, highlighted the cost impact of delaying the transition: “To avoid skyrocketing costs to ratepayers in the coming years, these expensive coal-fired power plants must be replaced with cleaner, renewable sources as quickly as possible. When Kentucky’s laws block the retirement of uneconomic coal-fired power plants and block the construction of new renewable sources, they increase every household’s electric bill.”
The report also shows that 95% clean energy can be achieved by 2050 with savings of $1.6 billion over the current baseline portfolio, but only if Kentucky’s electric utilities change their path now.
“Kentuckians deserve energy decisions that are based on facts, not assumptions,” said Ashley Wilmes, executive director of KRC. “This report shows that Kentucky can chart a cleaner, more reliable and fairer energy future. Supporting uneconomic energy from an aging fleet of coal-fired power plants increases risks and costs for Kentucky families and businesses. A more diverse portfolio based on renewable energy, battery storage and energy efficiency can in the future produce and maintain the reliable, lowest-cost electricity that has long been one of the Commonwealth’s greatest economic benefits.”
Download the full report at kyrc.org/energy-report-pdf.
