Indigo Division
U.S. coal-fired power plants could be forced to shut down two years sooner than planned under a Biden administration plan to cut pollution from the electricity sector, Bloomberg reported Friday, sending shares of some utilities and coal companies lower.
The potential change reportedly under serious consideration would accelerate the required retirement date for coal plants that fail to install carbon removal technology at the sites, a tougher approach than the Environmental Protection Agency's initial proposal last year that would give companies until 2040 to shutter the sites.
Biden administration officials already decided to shift the technology standard underpinning the rule's pollution reduction targets, the report said; while the measure proposed last year would have defined the "best system of emission reduction" as carbon capture and the use of cleaner-burning hydrogen as a replacement fuel, the draft now under White House review would stick with carbon capture only.
The effect of the potential shift would be felt unevenly across electric power providers but likely pose a heavier burden on those with more coal-fired power plants in their portfolios, with potential implications for rural electric cooperatives, as well as Duke Energy (DUK), Southern Co. (SO) and Talen Energy (OTCQX:TLNE) and others, according to the report.
Shares of coal producers have rebounded off earlier lows, including Alpha Metallurgical Resources (AMR) -2.8%, Peabody Energy (BTU) -1.6%, Arch Resources (ARCH) -1.1%, Consol Energy (CEIX) -0.6%, Warrior Met Coal (HCC) -0.6%, Ramaco Resources (METC) +0.5%, Alliance Resource Partners (ARLP) +0.3%.