A federal appeals court has overturned a federal order that has forced Consumers Energy to continue operating a west Michigan coal plant for more than a year beyond the plant's planned retirement date, but Consumers will not immediately shut down the coal plant based on that ruling.

The Washington, D.C. Circuit Court of Appeals vacated the first Department of Energy emergency order that kept the J.H. Campbell coal plant operating after its planned retirement date in May 2025. On Sept. 11, the three judges unanimously sided with the state and other groups who argued the Department of Energy's order was not based on a true emergency.

The judges said they were "unpersuaded" by the department's conception of an energy emergency that justified its mandate that Consumers Energy continue operating the J.H. Campbell plant in Port Sheldon Township.

In the first of six emergency orders Energy Secretary Chris Wright ordered for the Campbell plant, he said the Midwest region faced a potential tight reserve of power during emergency scenarios of high demand and low output. Wright cited the closures of fossil fuel and nuclear plants, including a Petoskey nuclear plant that closed in 1997, as the reason for the shortfall.

States are responsible for ensuring their residents have an adequate power supply, the judges wrote. In Michigan, the Michigan Public Service Commission handles that task. States work with regional grid operators to coordinate power supply and demand. While the Federal Power Act allows the federal government to step in during true crises, it can't directly regulate power plants.

The DOE used "fragments" of Midcontinent Independent System Operator, or MISO, energy supply forecasts to wrongly justify its emergency orders, said appeals Judge Cornelia Pillard, who wrote the opinion.

"The Department’s position would empower it to pick its preferred power sources in Michigan — or, presumably, any other state — and order them to operate without regard to the multiple procedural and substantive constraints built into state reliability planning processes," wrote Pillard, an appointee of former President Barack Obama. "We hold that section 202(c) is best read to apply where the Department identifies a risk of substantial harm from inadequate electricity supply that calls for immediate action by DOE in particular, as opposed to by the states."

Judges Sri Srinivasan and Robert Wilkins, also Obama appointees, joined Pillard in her ruling.

The judges' order applies only to the first of the six emergency orders that the DOE issued to keep the Campbell plant in operation, said Michael Lenoff, an Earthjustice attorney who participated in the case. Still, their reasoning applies to the subsequent orders the Trump administration issued for Campbell and other fossil fuel plants throughout the country.

"The Department of Energy, in any of its usage of emergency authority, should be following the law," Lenoff said. "Now the court has explained that an emergency must be a circumstance demanding immediate action from the department. As we've made clear to the department, it has presented no evidence in its orders to the other plants that there is any kind of imminent need for those plants. Those orders are not supported by the law."

Consumers Energy is not immediately shutting down the Campbell plant as a result of the court's order, company spokesman Brian Wheeler said in an email.

"Consumers Energy is reviewing today's court ruling," Wheeler wrote. "While that happens, we are continuing to comply with the current 90-day Department of Energy order that keeps the Campbell plant operating. 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."

The Campbell plant runs at a loss — it cost $180 million more than was returned in revenues in its first 10 months of operating under emergency orders, according to Consumers Energy financial filings. The additional cost will be recovered from customers throughout the MISO grid, including some as far as North Dakota.

Environmental groups who challenged the DOE's emergency orders alongside Michigan Attorney General Dana Nessel praised the court's Friday ruling. They have argued the orders released pollution and cost Michigan residents money for no reason except to prop up the coal industry.

"The Campbell coal plant is out of date, costs more to operate than other electricity generation options, and is one of the worst polluters in the state," said Derrell Slaughter, Natural Resources Defense Council Michigan policy director for climate and energy. "Today's federal court ruling has correctly rejected the Trump administration's illegal efforts to force the Campbell plant to continue to operate."

Nessel, the Democratic attorney general, has challenged all six of the emergency orders. The Sept. 11 order is the first time a decision has been made on those challenges.

"My office has been fighting this unlawful political stunt at every turn, and this ruling proves what we have been saying all along: this administration does not get to invent fake emergencies to bypass the rule of law against the best interests of Michigan residents," Nessel said in a statement. "We remain committed to fighting these nonsensical orders and protecting our ratepayers."

A DOE spokesperson was not immediately available for comment.

Consumers Energy planned to close the Campbell plant in May 2025. It had negotiated the closure with state officials and advocacy groups who sought a cleaner, more affordable power grid. Plant operators were running the 64-year-old plant's two working units at a minimum load to burn every last bit of coal before that date.

The Department of Energy issued its first emergency order a week before the Campbell plant's final day, requiring Consumers to keep the plant operating.

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