Trump's Campbell plant energy order struck down; closure could be tied up in courts

WASHINGTON — A federal court has struck down a Department of Energy directive that forced a Michigan coal-fired power plant to remain operational, ruling that the administration improperly invoked emergency powers to delay the facility's scheduled retirement.

In a 40-page opinion written by Circuit Judge Cornelia Pillard, a three-judge panel for the U.S. Court of Appeals for the D.C. Circuit unanimously granted petitions filed by the states of Michigan, Illinois, Minnesota, and a coalition of environmental organizations led by the Sierra Club.

The court vacated the DOE's May 2025 order, which had invoked Section 202(c) of the Federal Power Act to halt the scheduled retirement of Consumers Energy’s Campbell plant.

The federal order, issued in May 2025 just days before the plant was set to close, has cost Midwest utility customers an estimated $600,000 per day to maintain operations.

Similar emergency extensions issued nationwide have cost taxpayers and ratepayers more than $546 million to date. Environmental groups contend the extended operations have also blocked shovel-ready, lower-cost renewable energy developments slated for the Campbell site.

Limits on federal emergency powers

The court rejected the DOE’s broad assertion that Section 202(c) grants the agency sweeping power to command power plant operations based on generalized, long-term, or speculative energy reliability concerns.

Instead, the panel ruled that a federal "emergency" under the statute is narrowly confined to acute, unexpected supply crises — such as wartime disruptions, severe weather blackouts, or sudden facility breakdowns — where immediate action is required and state or regional regulatory processes are unable or unwilling to respond.

"Section 202(c) is essentially a narrow, last-resort backstop," Pillard wrote for the court, which included Chief Judge Sri Srinivasan and Circuit Judge Robert Wilkins. "Permitting DOE to compel generation in a situation that can be resolved through the ordinary resource adequacy planning mechanisms ... would render meaningless the constraints on federal power that Congress imposed throughout the Act."

Preservation of state jurisdiction

The ruling reaffirmed state sovereignty over electric generation facilities.

Under the Federal Power Act, states retain primary authority over in-state generation and long-term resource planning, while federal regulation is generally restricted to wholesale markets and interstate transmission.

The court noted that Consumers Energy had spent years working with the Michigan Public Service Commission and the Midcontinent Independent System Operator, or MISO, to coordinate Campbell's retirement. Regulators had approved a multiparty settlement replacing the aging, highly polluting coal unit with a combination of natural gas, solar generation, battery storage, and energy efficiency measures.

MISO’s technical evaluations and annual capacity auctions had repeatedly confirmed that regional grid reliability would be maintained without the Campbell plant.

Rejection of DOE arguments

The panel dismissed the DOE's justification that potential tight reserve margins in summer 2025 or long-term grid risks over a five-year horizon constituted a legal basis for emergency intervention.

The court emphasized that vague projections of potential shortfalls do not justify top-down federal compulsion, especially when state emergency declarations, MISO operational alerts, and voluntary market mechanisms exist to manage grid stress.

Furthermore, the court cautioned that routine federal overrides distort capacity market prices, discourage private investment in new clean energy infrastructure, and upend years of public regulatory planning.

Because the DOE's initial 90-day order — and its subsequent extensions totaling 450 days — rested on a fundamental misconception of its legal authority, the D.C. Circuit formally granted the petitions for review and vacated the order.

Environmental groups react

Legal representatives praised the decision as a decisive check on executive overreach.

"Today’s ruling is a victory for families across the Midwest who are tired of paying to keep this old, expensive, and dirty power plant online," said Sanjay Narayan, Chief Appellate Counsel for the Sierra Club. "Instead of working to lower costs and clean up our air and water, the administration has been pulling out all the stops to try to bolster dirty and expensive fossil fuels at public expense."

Earthjustice Attorney Michael Lenoff echoed those sentiments, characterizing the decision as a clear limit on federal authority.

"The court issued a rebuke of the administration’s abuse of emergency powers," Lenoff said. "Preventing the market-driven retirements of coal plants to advance a coal-friendly agenda is not a proper use of emergency powers. We will continue to challenge unlawful orders if DOE persists in issuing them."

The Department of Energy has not yet indicated whether it plans to appeal the ruling. Sierra Club attorneys stated they intend to continue legal challenges against remaining active extension orders across the country.

What happens next

Nessel, who led oral arguments before the court earlier this year, praised the decision and slammed the administration's reliance on emergency powers.

"By forcing its continued operation, DOE tried a never-before-used tactic to illegally prop up the aging J.H. Campbell coal plant that nobody asked to keep, sticking ratepayers with a bill for a facility that should have been retired," Nessel said. "I am relieved that the Court saw through this facade and threw out DOE’s order that had zero basis in reality."

While Friday's ruling invalidates the original May 2025 order, the fate of the Campbell plant remains tied up in subsequent legal battles. The DOE has issued five successive extensions since the original directive, with its sixth and current order mandating operations through November 14 — nearly 18 months past the plant's intended shutdown.

Nessel's office has filed multiple administrative rehearings and appeals challenging the subsequent extensions, which remain pending before the court.

A representative from Consumers Energy said Friday afternoon that the comapany is reviewing the court ruling.

"While that happens, we are continuing to comply with the current 90-day Department of Energy order that keeps the Campbell plant operating," said Brian Wheeler, media relations specialist for the utility. "Ultimately, we will follow the law and work to ensure that everyone who benefits from power from the Campbell plant across the Midwest pays their fair share."

— Sarah Leach is the executive editor of the Ottawa News Network. Contact her at sleach@ottawanewsnetwork.org. Follow her on Twitter @ONNLeach.