Why Should Delaware Care?
Energy experts and lawmakers are scrambling to ensure reliability for Delaware’s electric grid, and some downstate Republicans have pointed to NRG Energy’s Indian River Power Plant as a site that could be part of the solution.
The Indian River Power Plant shut down the last coal-fired energy generators in Delaware a year ago, but the hulking industrial site near Millsboro has emerged at the center of a debate over whether it could factor into the state’s energy future.
As new, high-demand energy users like hyper-scale data centers seek to soak up more electricity while aging infrastructure raises concerns about future power grid reliability, energy experts and elected officials alike are brainstorming ways to meet future demand in a region of declining energy supply.
Inside Legislative Hall, lawmakers have debated the promise of offshore wind, solar farms and even modular nuclear reactors as potential energy generation solutions.
But in recent months, Republicans have repeatedly pointed toward NRG Energy’s now-retired power plant as a potential solution to Delaware’s growing energy woes.
The Indian River plant was Delaware’s only generator of power used to meet everyday demand, known as baseload electricity, until it went offline in February 2025. Whether it could once again become a backbone of Delaware’s energy needs is a question of investment and best uses.
Why did Indian River close?
In regulatory filings, NRG blamed economics rather than politics or regulations for the need to close the Indian River power plant, noting that it had incurred financial losses for two consecutive years.
In June 2021, the company announced that it would close three different coal-fired power plants after revenue from the springtime energy auction dropped below $50 a megawatt per day, or a decline of more than 60% from the prior year.
That came at a time of great excess in energy supply when new natural gas-fired plants and renewable energy resources like solar and wind were pushing down costs for now comparatively small energy demands coming out of the COVID pandemic. This was also a time before the current rush to build hyper-scale data centers.
Coal is also a more expensive energy source, from the raw material to operation of the plant and disposal of the coal ash produced in its waste to implementation of scrubbers to reduce air pollution. By operating a coal-fired plant rather than building more efficient plants running on cheaper inputs, NRG was effectively cutting into its revenues – so it pulled the plug.
J. Scott Holladay, an associate professor of economics at the University of Tennessee who is familiar with the Indian River plant, said the demise of coal plants is simple economics.
“On the fuel side, it’s hard to imagine coal competing in the current environment,” he said. “It’s not so much that [coal has] gone up in cost, but that the cost of everything else has gone down.”
The power plant included four generating units, each made up of large pieces of industrial equipment that once burned coal to generate electricity.
Burning coal first created steam. That steam then powered turbines that would spin to generate electricity. It was a less efficient process than modern-day natural gas plants, which act like massive jet engines and no longer rely on steam as a middle man, or solar panels that convert solar energy into useful electrons.
The first two 80-megawatt coal-fired units at the plant went online in the late 1950s, followed by a third 165-megawatt unit in 1970 and a fourth 440-megawatt unit in 1980.
The first three units shut down in the 2010s. The final, most-modern unit shut down in February 2025 after more than four decades in operation.
And while Holladay said it would be unlikely for NRG’s southern Delaware power plant to come back online using coal, he did not rule out the possibility of its resurrection entirely.
“The thing that could save Indian River, and maybe other older plants, is big increases in electricity demand, driven by AI load,” he said.
Would NRG bring it back online?
A spokesperson for NRG Energy declined to comment on future plans for Indian River, saying they currently are “undetermined.”
But the spokesperson, Erik Linden, told Spotlight Delaware restarting the Indian River Power Plant in its original capacity — as a coal-fired operation — is not on the table. The company has no plans to restart any coal units at the facility, he said.
A small, 16-megawatt oil-burning plant remains active at the site as a “peakload” generator, which kicks on only in times of great energy demands. But even that unit is slated for decommissioning this June.
The power plant site spans nearly 1,200 acres, and it once had a total generation capacity of 780 megawatts. That wattage would have supplied just more than half the power demanded by the proposed, hyper-scale Delaware City data center.
Why is the site a talking point?
According to a recent report from the North American Electric Reliability Corporation, which compiles data from different regional energy transmission authorities including the PJM Interconnection which serves Delaware, future projections show that energy demand will increase while supply decreases.
That is due, in part, to power plants — including the Indian River Power Plant — shutting down while high-energy users, like large-scale data centers, plan to come online.
Republican lawmakers in Dover have wondered if restarting operations at the facility could help close the gap.
State Sen. Bryant Richardson (R-Seaford) has publicly pointed to the site as “an ideal location” for a small nuclear modular reactor, while Senate Minority Leader Gerald Hocker (R-Ocean View) and Senate Minority Whip Brian Pettyjohn (R-Georgetown) “are actively working with stakeholders” to figure out the plant’s future.
Pettyjohn told Spotlight Delaware that he and Hocker plan to meet with NRG officials during the General Assembly’s spring break with the goal of making Indian River a natural gas plant.
According to the National Pipeline Mapping System, the nearest natural gas transmission line is more than 2 miles away on U.S. Route 113. That means that extending service to the Indian River plant would likely cost $10 million or more, based on industry averages of recent projects.
Who would cover that cost and whether Delaware would incentivize it remain open questions about such a solution.
Then there’s the question of whether NRG would invest in new natural gas turbines at the Indian River plant, because they couldn’t just convert the old coal turbines. That investment would likely cost tens of millions of dollars per turbine, and those costs have been rising quickly in recent years as demand for the equipment has risen too.
But Holladay, who specializes in environmental and energy economics, said he is seeing “a lot of cases” of retiring coal plants converting to natural gas.
In Delaware, NRG has already proven that it can be successful.
More than a decade ago, it converted a unit at its Dover Energy Center from coal to combined-cycle natural gas, which captures both the combustion and heat from burning natural gas to spin two different turbines. The Dover plant was hailed as evidence of smart business as well as being environmentally friendly, as it removed significant sums of air pollutants that came from burning coal.
The Markell administration also incentivized that conversion project with a $500,000 grant from the state’s Energy Efficiency Investment Fund.
And while future plans for Indian River remain unclear, Holladay said the site could be ripe for conversion.
The Delmarva peninsula in particular, he said, is a “more isolated” part of the larger PJM electric grid. There are not many electric or natural gas interconnections on the peninsula, but since that access is integral to power plants, the existence of any such infrastructure at the NRG site would be its most valuable asset.
“It’s ruinously difficult to get access to the electricity grid,” he said.
He called the idea of using the Indian River site to house modular nuclear reactors, however, “far-fetched.”
“It’s really hard to justify building a nuclear plant in a floodplain with an unproven technology relative to the other options they have,” Holladay said.
What about offshore wind?
The Indian River site has been in the news more lately because of its proximity to a planned interconnection for the U.S. Wind offshore wind farm that has been hamstrung by lawsuits and opposition by the Trump administration.
The site’s decades-long run as a power plant is exactly what made it so attractive as a place for offshore wind farms to connect to the grid.
“That, to me, is the most valuable asset that Indian River has,” Holladay said.
In fact, NRG was among the first companies interested in offshore wind development along Delaware’s coast. In 2009, NRG Energy acquired Bluewater Wind, an offshore wind developer that sought to build a project that could have produced up to 200 megawatts of electricity. That project was ultimately abandoned.
A substation site on former power plant land along the Indian River has also been identified as the proposed point of interconnection for a different offshore wind project, the 121-turbine US Wind farm that is slated to be built about 10 miles off the Delmarva coast. That project has been embroiled in litigation and efforts from the Trump administration to halt all American offshore wind efforts.
Considering coastal risks
The Indian River Power Plant site is close to integral power grid infrastructure, but it also is directly in the path of rising tides, as Holladay noted.
According to the Delaware Department of Natural Resources and Environmental Control (DNREC) flood planning tool, much of the Indian River Power Plant sits directly in a flood zone. Its highest points are no more than 30 feet above sea level.
A recent study published by the nonprofit Climate Central and scientists at the University of California estimates some industrial sites pose additional hazards to nearby vulnerable communities as climate change continues to accelerate rising sea levels and exacerbate weather events like coastal storms.
According to Climate Central’s data, the Indian River plant is expected to experience about four flood events annually by mid-century, making it one of the most at-risk industrial sites in the state.
Increased flood risks also mean toxic coal ash storage pits are likely to face future inundation as well. While such toxic waste disposal sites are typically capped and lined to prevent environmental impacts, adding salty water to the mix could test those barriers, Holladay said.
“Flooding concerns would be a big deal, potentially,” he said.
For years, environmentalists have warned that power plant waste landfilled along the river’s edges has already released hazardous chemicals and metals into the nearby waterways and groundwater.
DNREC said in an email, however, that landfills at the site are “in good standing” when it comes to permitting and maintenance.
In 2019, the Environmental Integrity Project released a study about contamination linked to coal-fired power plants across the country, citing problems with coal ash contaminant levels detected specifically at the Indian River site. According to the report, data indicated unsafe levels of arsenic and other heavy metals in area water sources.
