It’s projected that artificial intelligence centers will grow astronomically within the next decade, though it depends on which analyst as to just how astronomical that growth will be.
The demand will double, according to an estimate by the International Energy Agency, or it will surge by 160%, according to Goldman Sachs.
Rocky Mountain Power, meanwhile, has reported at least 10 gigawatts of new requests for power from artificial intelligence and data centers during testimony before Wyoming lawmakers earlier this year.
The company also said it cannot tell just how much of that is real, firm demand, versus how much is speculative, or multiple companies working on bid proposals for the same data center.
The one thing in all that which does seem certain, with wait times as long as five or six years to connect to the power grid, is that America needs a lot more power, and it needed it yesterday.
The Trump administration declared a national energy emergency in January and followed up with executive orders in April aimed at grid reliability.
Then, in May, Department of Energy Secretary Chris Wright followed up with an unprecedented order directing the J.H. Campbell Complex in Michigan, which had been scheduled to close, to remain open. That order was extended in May through mid-November.
Wright’s directive cited increased electrical demands during the summer, and noted that the plant was shutting down 15 years before the end of its scheduled design life, but the Trump administration has also highlighted an “unprecedented surge in electricity demand driven by rapid technological advancements, including the expansion of artificial intelligence data centers, and an increase in domestic manufacturing” in several of its recent moves around power, and it’s said that it’s imperative, for national security, that the nation use “all available power generation resources, particularly those secure, redundant fuel supplies that are capable of extended operations.”
All of which sets the stage for an important question for the Cowboy State. Does America need Wyoming’s coal for artificial intelligence?
Demand For Coal Strengthening
The first part of answering that question is really just a discussion about America’s continued need for baseload power, Wyoming Energy Authority’s Kyle Wendtland told Cowboy State Daily.
“That isn’t going away,” he said. “The alternatives, like wind and solar, have their place. But that has to be backed up in some form or fashion. And right now, the backup is coal, nuclear or gas. Those are really your choices, not necessarily in that order, but those are your baseload, backup choices.”
Batteries can help with a small percentage of backup needs, but their cost is quite high, and the timeframe they can serve is low.
“A battery can fill some of that backup, but nowhere near the need,” Wendtland said. “And when you’re talking about a coal plant, that coal pile is the battery.”
Coal, Wendtland added, is ideal for steady consistent power — exactly what data centers and AI demand.
“So, knowing those things, when you look at well, if this plant closes, then is there an opportunity for them to bring in a data center, and is that something that the (people) in that area would like to have?” Wendtland said. “It raises that question.”
Wyoming Mining Association Executive Director Travis Deti told Cowboy State Daily he’s already seeing stronger demand for coal, thanks to surging power needs.
“And you know, it’s not just Wyoming that needs the power,” he said. “It’s the entire country. A lot of the power that we generate in Wyoming, whether it’s Black Hills up in the northwest or PacifiCorp in the southern part of the state not only powers Wyoming, but we export a lot of that power to other places, too.”
Wyoming Coal At Campbell Plant Is Worth 60 Jobs
Deti called the orders keeping the Campbell plant in Michigan open “pretty forward-looking,” and said he’d welcome similar orders in Wyoming.
“They’re keeping those plants open because grid operators are saying you’re looking at projected demand driven by AI — computing, data centers, electric vehicles, and just general electrification,” Deti said. “People are switching from gas to electricity for their heat around the country, which is just a trend that’s going on right now. You’re going to need to keep your existing stations open. Of course, that’s a good thing. Wyoming coal feeds those plants.”
In fact, about 3.5 million tons of coal from Wyoming fed the Campbell plant in Michigan, according to University of Wyoming economist Rob Godby, who estimated that this equals about 60 Wyoming jobs.
“That’s just under 2% of our total coal production which went to that plant,” Godby said. “So, it’s a pretty large plant.”
The rub, there, though, Godby added, is that the plant was slated to close because the company had less expensive alternatives to serve its demand.
That additional cost is being paid for by ratepayers in Michigan, and it’s something that’s sparked debate and controversy in that state.
“The whole reason they were shutting it down is because it was so expensive, and they’re not having brown outs or anything there,” Godby said. “So, they’re kind of ticked off.”
Godby said today’s public utilities across the nation have three basic requirements to meet. The first and most important two are to be safe and to be reliable. The third is to be as cost effective as possible.
“That’s the big reason we’ve seen so many coal-fired plants shut down over the past 15 years, is that they’re just not competitive, first with natural gas, and secondly with renewables,” Godby said.
Putting A Finger In A Dike
An order in Wyoming to keep a coal plant open would have a similar dynamic as far as costs go, Godby said.
“It’s just more expensive to operate coal versus natural gas now,” he said. “Imagine if Dave Johnston was closing, which it is kind of scheduled to close in '26, '27. It would probably keep north of 250 jobs at the plant, plus about 60 jobs in the mining sector employed. But the question is, someone has to pay for that. And that’s the concern in Michigan. At ($615,000) a day, if that’s truly what they’re paying to keep the plant open, you can multiply that over a year, if that’s truly the price tag, and then divide by the average coal plant workers salary, and you figure out pretty quickly that the cost to keep that plant open is probably more than if you just said to them, here’s the salary.”
Coal, Godby added, has been declining significantly since its 2007 peak, and projections for coal developed in state don’t show a much rosier picture, even with AI in the picture.
“We don’t all come up with the same number,” Godby said. “But the number we all agree to, that’s probably a consensus of everybody’s viewpoint is that we’ll probably produce about 200 million tons of coal this year. Last year, it was about 190, so we we’ve increased the coal production target by about 5% just due to market conditions right now.”
That’s estimated to fall to about 150 million tons by 2030, Godby added, or a 25% decline.
“We try to be apolitical if anything,” Godby added. “We are expecting coal to fall by 25% the next five years, and that’s our best estimate from a current production level … We don’t really see that changing any. The trend is still down, it’s just how quickly. And that’s not just me. That’s everyone, from the Wyoming State geologist’s office to me at the University of Wyoming to the Department of Revenue, the treasurer’s office, and so on.”
To that extent, Godby said, he believes orders to keep a particular coal plant open are just “putting a finger in a dike.”
“It’s just delaying an inevitable trend,” he said.
Wyoming Has Already Addressed Early Coal Plant Closures
The Campbell plant in Michigan is closing about 15 years earlier than planned. That issue is something that Wyoming has already somewhat addressed, Wendtland said.
“The legislature did pass some legislation a while back that, before they close a plant, they need to be able to put it up for sale,” he said. “So, they somewhat addressed that already in Wyoming. If there’s a buyer, there could be continued operation of those plants. So, I think that’s kind of where we are right now in Wyoming.”
That’s put the Cowboy State in a better situation than some states, Sen. Cale Case agreed.
“I think, in essence, Rocky Mountain Power already put the brakes on probably, with the exception of the Dave Johnson plant which is by Glenrock between Casper and Douglas,” he said. “I think that one is still on a bit of the chopping block, potentially. But Rocky Mountain Power has revised what they call their integrated resource plan, and they’ve in essence, reduced their reliance on renewables and they’re trying to extend the life of their existing plants, including Jim Bridger. Although part of that life extension involves the conversion of one of the units to natural gas, and we already lost the one in Kemmerer.”
The coal-fired power generation in Kemmerer is being replaced with a nuclear plant being built by TerraPower, which is already under construction.
While there would be headwinds there for an order to keep that plant burning coal, Deti said he’d welcome it.
“I would like to see them keep the coal online,” he said. “They are in a pretty difficult position right now. And they’re not only going to the gas, but they’re also developing the nuclear project out there. But I would love to find a way to keep that mine producing coal. There may be some opportunities for exports here in the next few years. But we’ve got to figure out a way to keep the coal mine open. Maybe AI and data centers or someone locating near to that place might be a solution.”
The World Is Changing
Coal plants work best when they run flat out, 24-7, Case said. The same is true of nuclear power to an extent, although TerraPower’s design gets around that economic reality with battery storage.
“That plant will run all the time, but store a lot of the energy, so it can draw down even bigger than its capacity, and try to make it follow wind and solar,” Case said. “It’s well placed to do that.”
But traditional coal plants, unlike TerraPower’s nuclear plant, weren’t designed with renewable energy in mind. The addition of renewables to the grid has fundamentally changed the power landscape in ways Case said are hard to walk back.
“In a world where there are no renewables, coal’s clearly cheap,” he said. “That Wheatland power plant was one of the cheapest plants in the nation. It’s still an amazing plant, but coal plants are economic when they run a lot. When they run 24/7 they can spread out all those costs over that production.”
The huge overhead involved in running a coal plant, in fact, demands it.
“If you load all those fixed costs on a plant that runs 10% of that now, or 20% or 50%, pick your number, that makes those on the margin costs much, much higher,” Case said. “And are those really a cost of coal? You could definitely argue that’s not even a cost of coal. It’s a cost of renewables. Because renewables aren’t 100% reliable. They’re not a firm resource. The cost of having a firm resource like a coal plant online is actually part of the cost of renewables.”
That’s part of what’s helping to drive more natural gas adoption. Natural gas is cheap, even when its generation isn’t spread over a 24-7 timeframe.
“If you were to do this from scratch, you probably wouldn’t build a coal plant,” Case said. “You would build a gas turbine plant. It’s easier to come online. It’s cleaner. It doesn’t cost as much money. It can be more modular. You can build smaller ones, and multiples of them, and the air quality issues aren’t so daunting.”
The enormity of power-hungry AI coming online, though, could be a game changer for coal, Case acknowledged. The trick will be ensuring that it’s AI paying for the coal plants, though, and not rank and file ratepayers, who now have cheaper options.
“This is the whole key to bringing on data centers in Wyoming or anywhere,” Case said. “Are we going to protect the rest of the rate payers from the rate impacts of that? If we are, then there is definitely room to have captive coal plants where the power is committed to go to those centers.”
But, Case added, the old model where businesses or residences expected to get power for the asking right away doesn’t work for data centers that want to use as much or more power than an entire city or even an entire state.
“If you want double the power of a city in one spot, that is a different animal,” Case said. “It took us 100 years to get to … 1 gigawatt demand in Wyoming. And they’re trying to double that in three years … that’s a big, big, big lift.”
Renée Jean can be reached at renee@cowboystatedaily.com.
