President Donald Trump signed several executive orders on Tuesday that should incentivize the construction of new coal power plants in the latest stark departure from his predecessor.
“We’re bringing back an industry that was abandoned,” Trump said, as quoted by Reuters. “We’re going to put the miners back to work,” the U.S. president added.
Coal power plants have declined as share of U.S. generation capacity over the years, especially with the influx of cheap natural gas. Coal plants currently generate a fifth of U.S. electricity, which is down from as much as half back in 2000. However, demand over the last 20 or so years has been largely flat, which has facilitated the replacement of coal with gas and, to a lesser extent, wind and solar. This is now changing with the advent of artificial intelligence.
Artificial intelligence was listed as one big reason for the rise in electricity demand in the United States last year—and the consequent increase in electricity supply from gas and coal. The other big reason was population growth. The trend is set to continue, as Big Tech only becomes more ambitious with its AI plans. This means more generation capacity would be needed.
Nuclear is one segment of the power generation industry that is set to benefit from the surge in demand, but coal is not being forgotten, either. It takes less time to build coal plants and with the existing scrubbing technology, particulate matter emissions are significantly lower than they used to be, strengthening the case for new coal.
Globally, coal capacity and consumption is still growing. Last year, a total of 44.1 gigawatts of coal power capacity was commissioned, while 25.2 GW was retired, resulting in a net increase of 18.8 GW, according to data from the Global Energy Monitor’s Global Coal Plant Tracker.
The capacity commissioned was almost 30 GW below the annual average for 2004 to 2024, which was 72 GW. While that’s a sign of the continued slowdown in global coal construction, new coal capacity in China and India more than offset coal retirements in many developed nations. Now, the U.S. seems set to join China and India in coal growth.
