NEW TOOLS TO MANAGE FINANCIAL TRANSITION FROM UNECONOMIC COAL TO CHEAP, CLEAN POWER

This briefing by Energy Innovation introduces a series of tools designed to help regulators, utilities, and investors manage the financial transition from uneconomic coal-fired power plants to cheaper clean energy generation, using Colorado as a case study.

• A significant amount of U.S. coal-fired power capacity is expected to retire in the near term, with over 15 GW expected to close in 2018 and at least 36 GW forecast for retirement by 2024.
• Current regulation may hinder the transition because regulated utilities have a financial incentive to keep uneconomic plants operational to continue earning a rate of return on those assets.
• The briefing series proposes several financial mechanisms to facilitate the transition, including the use of depreciation accounting to manage asset value reduction, the 'Steel for Fuel' approach where capital is reinvested from coal into renewables to improve shareholder earnings, and the refinancing of undepreciated balances by replacing equity with corporate debt to reduce the burden on consumer rates.

APA

LEHR, R., & O’BOYLE, M. (2018). NEW TOOLS TO MANAGE FINANCIAL TRANSITION FROM UNECONOMIC COAL TO CHEAP, CLEAN POWER. Energy Innovation. https://energyinnovation.org/wp-content/uploads/2018/12/Managing-The-Utility-Financial-Transition-From-Coal-To-Clean.pdf

Chicago

LEHR, RON, and MIKE O’BOYLE. NEW TOOLS TO MANAGE FINANCIAL TRANSITION FROM UNECONOMIC COAL TO CHEAP, CLEAN POWER. Energy Innovation, 2018. https://energyinnovation.org/wp-content/uploads/2018/12/Managing-The-Utility-Financial-Transition-From-Coal-To-Clean.pdf.

Wikipedia

{{cite report |last1=LEHR |first1=RON |last2=O’BOYLE |first2=MIKE |title=NEW TOOLS TO MANAGE FINANCIAL TRANSITION FROM UNECONOMIC COAL TO CHEAP, CLEAN POWER |publisher=Energy Innovation |date=December 2018 |url=https://energyinnovation.org/wp-content/uploads/2018/12/Managing-The-Utility-Financial-Transition-From-Coal-To-Clean.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{lehr2018new, author = {LEHR, RON and O’BOYLE, MIKE}, title = {{NEW TOOLS TO MANAGE FINANCIAL TRANSITION FROM UNECONOMIC COAL TO CHEAP, CLEAN POWER}}, institution = {Energy Innovation}, year = {2018}, month = dec, url = {https://energyinnovation.org/wp-content/uploads/2018/12/Managing-The-Utility-Financial-Transition-From-Coal-To-Clean.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }