NEW ORLEANS – A new federal directive encouraging the Department of Defense to enter long-term power purchase agreements with coal plants is drawing scrutiny from energy advisors and lawmakers who argue the military has already demonstrated that renewable microgrids can deliver both resilience and cost efficiency.
Jamie Skaar, a revenue strategy consultant who advises energy and industrial technology companies as a fractional chief revenue officer, questioned the rationale behind steering the Pentagon toward long-term coal contracts. “The Pentagon built a solar microgrid that powered an entire Army base for 14 days during a grid outage in January,” Skaar said. “Then they were ordered to buy coal.”
He pointed to Fort Hunter Liggett in California, which he described as the only DOD installation operating a microgrid entirely on renewables, without diesel backup or coal.
“When PG&E’s substation failed in January, the base kept operating on solar and battery storage while surrounding communities went dark,” he said. “That’s not a pilot program. That’s proof of concept at scale.”
Skaar noted that the Army has set a goal of deploying a microgrid at every installation by 2035 and that the Department of Defense has installed 1.3 gigawatts of renewable capacity since 2010. He also cited Camp Lejeune’s solar array, which kept critical operations running during Hurricane Florence.
National Security and Energy Diversity
Skaar’s remarks come amid broader debate over how national security and grid resilience should be defined and whether fuel diversity or traditional baseload generation offers greater stability.
In a January column, U.S. Rep. Troy A. Carter Sr., D-La., criticized federal actions pausing offshore wind development, arguing that energy diversity strengthens rather than weakens national security.
“Energy diversity is national security,” Carter wrote. “A resilient grid cannot depend on a single source of power.”
Carter said offshore wind development in the Gulf of Mexico could complement — not replace — traditional energy jobs in Louisiana. “Offshore wind development in the Gulf would not replace oil and gas jobs,” Carter wrote. “It would build on them, using the same skills Louisiana workers already possess, while reducing harmful emissions that disproportionately impact frontline communities.”
Coal – Cost, Contracts and Long-Term Risk
Skaar argued that beyond resilience claims, the economics of long-term coal contracts raise additional concerns. Citing Lazard’s 2025 levelized cost of energy analysis, he said new coal generation costs between $71 and $173 per megawatt-hour, compared to $38 to $78 for solar and $37 to $86 for wind.
“These PPAs lock the Pentagon into the most expensive generation source available — with taxpayer money,” Skaar said.
He also questioned how proposed coal plant upgrades would be financed.
“That $175 million announced for coal plant upgrades is being pulled from bipartisan infrastructure law funds originally designated for carbon capture,” he said, noting that former Department of Energy officials have questioned whether the agency has authority to redirect those dollars without congressional approval. “So we’re taking money earmarked for next-generation technology and spending it to extend the life of 50-year-old plants.”
The Pentagon contracts come as the Trump administration has also used emergency authority under Section 202(c) of the Federal Power Act to require several aging coal and fossil-fuel plants scheduled for retirement to continue operating. Environmental groups, including the Sierra Club, argue those orders — historically reserved for acute energy emergencies — are being applied despite grid operators determining the plants are not needed for reliability.
According to estimates cited by the Sierra Club, more than $223 million has already been spent to keep six such facilities online, with costs ultimately passed on to ratepayers. Independent analyses commissioned by environmental groups have projected that similar extensions nationwide could cost billions annually if applied more broadly.
Skaar said coal’s long-term decline introduces additional contract risk.
“Coal capacity peaked at 317 gigawatts in 2011. Today it’s 172. The Energy Information Administration projects 5 percent annual declines,” he said. “One plant given emergency orders to stay open this year had two days of coal supply left.”
