Case studies of the misguided stampede to build gas power plants

The push to build new U.S. gas-fired generation capacity is unmistakable, with utilities, developers, and even many regulators rushing to approve projects without fully considering the risks. Following up on the Institute for Energy Economics and Financial Analysis (IEEFA)’s earlier report, The Misguided Stampede to Build Gas Power Plants, today’s briefing note looks at three utilities as they seek to meet anticipated growth in electricity demand while transitioning away from fossil fuels. The findings show the importance of state policies and utilities' tendency to stick with what they know, even in the face of external pressure and new challenges.

The three case studies examine one large investor-owned utility (IOU), Entergy Corporation, which serves a four-state area along the Gulf Coast; one mid-sized IOU, Portland General Electric, the largest utility in Oregon; and a small cooperative, Holy Cross Energy, based in Colorado. IEEFA’s findings are straightforward:

• Entergy earns an F on the transition test. It plans to build a substantial amount of new gas-fired generation capacity, which could carry significant costs for its consumers. The utility is also slowing the development of fuel-free renewables that can be built quickly and scaled as needed to support actual growth.
• Portland General Electric has made significant progress toward moving away from fossil fuels, having closed its only coal plant in Oregon and planning to exit its 20% stake in the Colstrip coal station in Montana. It is also building or contracting for substantial amounts of new wind, solar, and battery storage capacity, which will help it meet new demand without the threat of fuel price spikes. Still, it owns five gas-fired power plants that currently provide 40% of its generation needs and has not yet indicated when it will be able to close them. PGE’s progress is promising, but its grade is an Incomplete.
• Holy Cross Energy, the smallest of the three utilities by far, has made the biggest progress. Its electricity mix in 2025 was 85% renewable, and its electricity costs were 33% lower than the national average. HCE has aced the test; its A grade is well-deserved.

“These case studies underscore two realities about the electric power sector,” said Dennis Wamsted, IEEFA energy analyst and author of the briefing note. “First, it is possible to transition away from fossil fuels without massive consumer price increases. And second, it is easy for utilities to stick with what they know, even if that puts consumers at significant financial risk.”

The work done by Holy Cross Energy clearly shows that utilities can provide reliable, cost-effective service to their customers while phasing out their reliance on fossil fuels. Critics may dismiss the utility’s successes because of HCE’s small size and question whether it can complete the remaining 15% of its transition. However, the first critique is misleading since a utility’s size, by itself, doesn’t help or hinder the transition but simply changes the magnitude of the investments and effort required. And concern about the feasibility of a 100% transition highlights how far utilities already can move toward a fossil-free future. 

The takeaway: Move as far as you can and then figure out the rest. Do not stand still because you cannot see a path all the way to the end.