Trump set to use defense law to fund coal plants, export terminal

The Trump administration was set to pour nearly $700 million into coal at a moment when the fuel’s long decline has left utilities, markets and regulators under pressure to decarbonize. President Donald Trump planned to use the 1950 Defense Production Act at a White House event themed “Beautiful, Clean Coal” to steer federal money toward aging plants, new construction and a contested West Coast export terminal.

The package would direct $425 million to upgrades at 13 existing coal-fired power plants, $75 million to the West Gateway coal export terminal in Northern California, and $185 million in Energy Department grants to help build two new coal plants in Alaska and West Virginia and restart a plant in Maryland. The administration cast the move as a national security measure, saying it was needed to bolster electricity supplies for AI data centers and reduce dependence on foreign energy. Reuters reported that the Northern California terminal could also move coal to Asia while supporting domestic power generation.

The plan sharpened the political split around coal’s place in the U.S. grid. Sierra Club climate policy director Patrick Drupp condemned it as a taxpayer-funded subsidy for a polluting industry and said the group would fight it in court. Rich Nolan, chief executive of the National Mining Association, praised the funding as a way to strengthen production, cushion consumers from energy price swings and meet rising electricity demand. Those arguments go to the heart of today’s energy policy fight: whether coal is a necessary backstop for reliability or a costly holdover from a carbon-intensive system.

The federal push lands against steep long-term decline. Congressional researchers say U.S. coal consumption peaked in 2007 and production peaked in 2008. By 2024, coal consumption had fallen 64%, and coal made up just 8% of primary energy consumption, down from 23% in 2000. Data from the U.S. Energy Information Administration also show coal’s share of annual U.S. electricity generation dropping sharply from its 2007 peak. Any attempt to reverse that trend with emergency powers will likely invite fresh questions about whether public money should underwrite a fuel whose market share has been collapsing for nearly two decades.

The export terminal at the center of the plan carries its own history. The Oakland Bulk and Oversized Terminal at the former Oakland Army Base has been the subject of years of litigation after public backlash over possible coal transport prompted the City of Oakland to move against the project. California appellate rulings in 2025 upheld the lease and cleared a path for the terminal to advance, setting up a renewed fight if federal money now gives it new life.