Utilities Across the United States Are Failing to Transition to Clean Energy

In 2024, the planet crossed what many scientists consider a dangerous threshold: It warmed to about 1.55°C above preindustrial levels, passing the Paris Agreement’s 1.5°C threshold. That same year, American utility companies largely failed to do their part to ramp down fossil fuel usage. They earned a failing grade in the new report The Dirty Truth About Utility Climate Pledges, the Sierra Club’s yearly analysis of utilities’ public commitments to sustainability versus their actual plans to transition from fossil fuels to clean energy.

The report found that the nation’s largest power providers are clinging to coal, one of the dirtiest sources of energy, and racing to build new gas plants. The authors examined the long-term plans of 75 utility companies and found an industry aggregate score of just 15 out of 100—the lowest score in the report’s five-year history. It evaluated utilities based on whether they will phase out coal plants by 2030, stop building new gas plants, and invest in enough clean energy to replace fossil fuels by 2035. 

On all fronts, most companies failed. 

“So many utilities use load growth as an excuse to backtrack on their climate progress and goals, instead of using it as a bold opportunity to meet the moment and build the clean energy we need for a clean and renewable future,” said Emma Pabst, a campaign manager for the Sierra Club’s Beyond Coal campaign and one of the authors of the study. “The reality is that a lot of utilities are stuck in old, outdated, and dirty habits, and the data shows across the board that clean is more affordable.”

Many utilities are backsliding on their commitments to clean energy sources such as wind and sun, and greenwashing at the same time—even though 65 companies in the study have climate pledges, only three of them received an A rating. Collectively, utilities are planning less renewable capacity than is necessary to replace existing fossil plants, let alone to meet the clean energy targets that most scientists agree are necessary to prevent irreparable climate damage: 80 percent clean electricity by 2030 and 100 percent by 2035.

Despite the relative affordability of renewable energy, utilities are unable or unwilling to untether themselves from coal and gas. The 75 companies in the report plan to retire just 29 percent of coal generation by 2030, and 61 of them intend to build a combined 118 gigawatts of new gas capacity by 2035.

The Dirty Truth report comes at a time when electricity demand has skyrocketed, fueled in part by the rise of energy-intensive data centers. This is the first edition of The Dirty Truth that has taken plans to build clean energy to meet growing electricity demand into account, because it is an increasingly pressing issue for utilities—and many of them meet that demand by investing in fossil fuels.

Few examples illustrate this better than the Northern Indiana Public Service Company. Although NIPSCO earned an A in every former report, its score fell 23 points from last year to this year, dropping to its lowest-ever score of 57 out of 100. 

The reason: Electricity demand, also known as load growth, is surging, and NIPSCO’s clean energy plans are not keeping pace. The company predicts far greater load growth than in previous years, but its current renewable energy plans would cover only 31 percent of its existing fossil generation and projected growth. Even though NIPSCO plans to close its remaining coal plants by 2030, the utility is also planning 400 megawatts of new fossil fuel construction at the Schahfer site by 2035. Part of that new load growth is from data centers. For example, NIPSCO plans to power potential hyperscale data center development with over 3,500 megawatts of new gas infrastructure. 

NIPSCO has pledged to reduce its carbon emissions by 90 percent by 2035 and to reach net-zero emissions by 2040. But its parent company said in the spring that its climate goals, “may evolve as we assess and respond to business opportunities such as data centers.” 

“We have the technologies that we need today in order to solve this. Wind, solar, and storage combined can get us to 80 percent clean energy or beyond.”

In Kansas and Missouri, the utility company Evergy scored just nine points out of 100—only four points above its score in the first edition of the report five years ago. Evergy serves 1.7 million people and is based in Kansas City, one of the most energy-burdened cities in the US, where many low-income, Black, and Latino households spend six percent or more of their income on electricity.

Evergy has refused to adopt local climate goals or commit to retiring the Hawthorn coal plant in Kansas City. The utility intends to retire only a third of its coal generation by 2030, while adding more than 5,500 MW of new gas capacity by 2035. The emissions from that gas capacity, if built, would add as much annual pollution as 2.5 million cars.

Evergy has also walked back its emissions reductions goals. Five years ago, the utility touted its “Sustainability Transformation Plan,” which said Evergy could cut emissions 85 percent by 2030. Since then, Evergy has removed the pledge altogether. The company also proposed fewer plans for clean energy in 2025 than it did in 2024.

The failures are not happening in isolation: The federal government has eliminated $22 billion of funding for clean energy projects this year alone. 

“We saw really great climate progress during the previous administration, with the IRA and the [Infrastructure Investment and Jobs Act] and lots of federal rules that cracked down on pollution to make our communities cleaner and safer. We're seeing that get rolled back piece by piece,” said Noah Ver Beek, a senior energy campaigns analyst with the Beyond Coal campaign and one of the report’s authors. “Even more, we're seeing crackdowns on the amount of clean energy that can get built on public lands and the processes that a clean energy project needs to go through in order to receive federal permits.”

The consequences of fossil fuel reliance will land on ratepayers. According to a separate report, Assessing Impacts of the 2025 Reconciliation Bill on US Energy Costs, Jobs, Health, and Emissions, sticking with gas and coal will drive up electricity bills by $120 a year for the average household by 2030, rising to $230 by 2035. 

Despite some companies improving their plans since the report’s first edition in 2021, the overall trajectory is moving backward. Unless utilities abandon fossil fuel expansion and accelerate clean energy, customers will be stuck with higher bills and dirtier air. 

The Dirty Truth report calls on utilities to recommit themselves to sustainability, even as the Trump administration does everything in its power to defund renewable energy projects and further entrench the United States in fossil fuel reliance.

“We don't need to wait for some new technology, or something great and special and new to come up. We have the technologies that we need today in order to solve this,” Ver Beek said. “Wind, solar, and storage combined can get us to 80 percent clean energy or beyond.”