Washington State House Approves Coal Tax Targeting Centralia Power Plant

The new tax aims to thwart a federal move to keep the last coal-fired power plant in the Pacific Northwest operational.

Published on Feb. 13, 2026

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The Washington House of Representatives has approved a new coal tax that targets the TransAlta Corporation's Centralia coal plant. The tax is meant to make the plant uncompetitive in the electricity marketplace and prevent it from restarting operations, which the Trump administration had ordered in a surprise move. The bill now heads to the state Senate.

Why it matters

The move by Washington state lawmakers is an attempt to assert state control over energy policy and transition away from coal power, despite the federal government's efforts to keep the Centralia plant running. This highlights the ongoing tensions between state and federal authority over energy and environmental regulations.

The details

The new tax would remove tax and regulatory exemptions that were part of a 2011 agreement between the state and TransAlta to phase out coal power in Washington by the end of 2025. The state sales tax would be levied on coal deliveries, and TransAlta would have to purchase climate pollution allowances at the state's cap-and-trade auctions to cover emissions from burning coal. These added costs would make the Centralia plant highly uncompetitive.

  • On December 2025, TransAlta idled the Centralia power plant in conformance with the 2011 agreement.
  • In December 2025, the U.S. Energy Department issued an emergency order to TransAlta to keep the Centralia coal plant available for operation for a period of 90 days, until March 16, 2026, with possible extensions after that.

The players

TransAlta Corporation

The Alberta-based company that owns the Centralia coal plant, which it idled in December 2025 as part of a 2011 agreement to phase out coal power in Washington.

Joe Fitzgibbon

The House Majority Leader and lead sponsor of the bill to impose the new coal tax on the Centralia plant.

Ed Orcutt

A Republican state representative whose district includes the Centralia area, who expressed concerns about the state locking itself out of being able to respond to potential power shortages.

Marko Liias

The Democratic state senator who sponsored an identical version of the coal tax bill in the state Senate.

Nick Brown

The Washington state Attorney General who, along with several environmental groups, filed administrative appeals with the U.S. Energy Department seeking withdrawal of the agency's emergency order to keep the Centralia plant operational.

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What they’re saying

“This bill is intended to close the book on that chapter of our state's electricity generation; to once and for all say we're done generating electrons with the dirtiest and most expensive way to do so.”

— Joe Fitzgibbon, House Majority Leader (dailyfly.com)

“The Trump administration will continue taking action to keep America's coal plants running so we can stop the price spikes and ensure we don't lose critical generation sources. Americans deserve access to affordable, reliable, and secure energy to heat their homes all the time, regardless of whether the wind is blowing or the sun is shining.”

— Chris Wright, U.S. Energy Secretary (dailyfly.com)

“We know there could be times when we end up with shortages of power. As soon as this bill is signed, we're locked out. We can't respond if there is an emergency.”

— Ed Orcutt, State Representative (dailyfly.com)

What’s next

The Energy Department faces a Friday deadline to respond to the administrative appeals filed by the state Attorney General and environmental groups seeking withdrawal of the emergency order to keep the Centralia plant operational. If the Energy Department does not honor the request, further legal action may be taken.

The takeaway

This battle over the Centralia power plant highlights the ongoing tensions between state and federal authority on energy and environmental policies. Washington state is asserting its prerogative to transition away from coal power, while the federal government is seeking to keep the last coal plant in the region operational. The outcome could have significant implications for the future of coal power in the Pacific Northwest.