in brief
- Donald Trump has invoked the Defense Production Act of 1950 to support the coal industry.
- $US700 million ($981m) will be spent to support existing mines, upgrade coal plants, and build a new export terminal.
President Donald Trump has taken a bold step to bolster the coal industry in the United States by tapping into a piece of legislation from the Cold War era. Announced on Friday, Trump plans to utilize the Defense Production Act—originally enacted in 1950—to channel US$700 million (NZ$981 million) towards revitalizing the coal sector.
Trump’s strategy includes updating over a dozen coal power plants, constructing a significant coal export terminal on the West Coast, and matching funds from corporations to establish new power facilities. These efforts are part of a broader initiative to enhance the nation’s energy infrastructure.
“Today, we’re officially invoking the Defense Production Act to save 13 coal plants across states like West Virginia, Kentucky, North Carolina, Indiana, Tennessee, Arizona, Arkansas, Oklahoma, North Dakota, and Wisconsin,” Trump declared during an address at the White House. He emphasized that this move aims to lower energy prices and reduce living costs for Americans, hailing coal as “clean, beautiful” energy.
The allocation of the US$700 million (NZ$981 million) breaks down as follows: over half of the funding is earmarked for upgrading 14 coal plants, US$185 million (NZ$259 million) will be used to match corporate investments in coal facilities in states with a strong coal heritage, and US$75 million (NZ$105 million) is designated for the West Gateway export terminal, a long-anticipated project in Northern California.
Of the US$700 million ($981m), more than half will fund 14 coal plant upgrades, US$185 million ($259m) will match corporate funds for coal facilities in traditionally coal-heavy states, and US$75 million ($105m) will support the long-proposed West Gateway export terminal in Northern California.
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Trump said the new initiative involved redirecting US$200 million ($280m) from climate change projects towards new coal plants in Maryland, Alaska, and West Virginia.
The new West Coast coal export terminal will be built in California with the capacity to handle 12 million tons of the fossil fuel, he added.
US energy secretary Chris Wright said coal was “a critical source of our electricity, also a critical source for our industry”.
The Trump administration has framed energy issues in existential terms as it eyes the domestic need to sustain power-hungry artificial-intelligence data centres and aims to marginalise foreign adversaries that hold large fossil fuel reserves.
Coal, however, has faced steady declines in US usage. It once accounted for more than half of US electricity generation, but has fallen to just 17 per cent in recent years, according to the US Energy Information Administration.
Power producers have largely switched to cheaper natural gas and renewable sources, wary of fossil fuels’ effect on the planet’s warming climate and increasing reliance on brittle global supply chains.
Trump frequently calls human-induced climate change “a hoax” and has worked since returning to power last year to wipe out a number of environmental regulations, many of which limited fossil fuel use.
On 11 February, Trump signed an executive order directing US defence secretary Pete Hegseth to enter into long-term supply contracts with US coal power plants.
In a photo op at the White House signing of that order, the president was feted as the “undisputed champion” of coal, surrounded by miners in hard hats.
The next day, Trump repealed a 2009 EPA “endangerment finding,” foundational legislation underpinning US climate regulations. A coalition of environmental and health groups has challenged the action in court.
Global average temperatures are likely to continue at or near record levels this year, and for the next four years afterwards, the United Nations warned last week.
UN climate chief Simon Stiell said the “main culprit” of warming temperatures was humanity’s burning of coal, oil and gas, which is the primary driver of climate change. Coal is the fuel that emits the highest levels of greenhouse gases.
The world built and commissioned more coal power in 2025, but used the polluting fuel less, with the US the only major economy to substantially increase generation, analysis by the Global Energy Monitor shows.
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