TransAlta Gets Energy Department Order to Keep Washington Coal-Fired Plant in Operation for 90 Days

By Robb M. Stewart

TransAlta has been ordered by the Energy Department to keep open for a 90-day period a coal-fired power station in Washington state that had been earmarked for closure.

The Canadian energy company said Wednesday it received an order from the U.S. Department of Energy mandating that unit 2 of its Centralia electricity-generating facility remain available for operation until March 16. It said it was evaluating the order and would work with state and federal governments.

Unit 1 of the Centralia facility was retired at the end of 2020, and TransAlta had planned to close the second unit at the end of this year as part of its shift to cleaner sources of electricity. Power from the Centralia coal plant feeds the west-coast electrical grid in the U.S.

Washington legislation in 2011 required TransAlta to shut down the coal-fired boilers at Centralia in two phases.

President Trump in April signed executive orders meant to expand the production and use of coal in the U.S. after years of decline. The Trump administration has sought to ensure that fossil-fuel power plants slated for closure keep operating, and the president this year declared a grid-reliability emergency, citing surging electricity demand for artificial intelligence and new manufacturing.

TransAlta, which operates a fleet of electric-power generating facilities in Canada, Australia and the U.S., last week said it had signed a long-term supply agreement with Puget Sound Energy to convert Centralia Unit 2 from coal to natural-gas-fired generation. The pact provides a fixed-price capacity payment providing Puget Sound with the exclusive right to the capacity, energy and services of the 700-megawatt facility.

John Kousinioris, TransAlta's president and chief executive, said the conversion to natural gas would lower the emission intensity profile of the facility by about 50%. The facility will generate long-term contracted cash flow for the company when it returns to operation, he said.

About $600 million of capital will be required to extend the useful life of the facility and convert it from coal to natural-gas-fired generation, with TransAlta aiming for a commercial operation date in late 2028 for a facility it plans to operate until the end of 2044 under the terms of the agreement, the company said. TransAlta had expected to make a final investment decision when it received all required approvals, anticipated in early 2027.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

December 17, 2025 08:08 ET (13:08 GMT)