What Trump’s Coal Order Means for the Pentagon and the Energy Landscape
President Donald Trump’s recent executive order directing the Department of Defense (DoD) to buy electricity from coal‑fired plants has reignited the debate over the future of fossil fuels in the United States. While the order is framed as a move to “preserve and strategically utilise” coal‑based energy assets, it also raises questions about cost competitiveness, climate commitments, and the long‑term direction of U.S. Energy policy.
Key Elements of the Executive Order
- Mandates the Pentagon to enter long‑term purchase agreements with coal‑powered generators.
- Prioritises the “preservation and strategic utilisation” of coal‑based assets.
- Provides no details on the volume of electricity to be purchased or the financial terms.
- Allocates $175 million for the Department of Energy to upgrade six coal plants across North Carolina, Ohio, West Virginia, Kentucky and Virginia.
At a White House event attended by coal executives and miners, Trump praised the industry, saying, “You heat our homes, fuel our factories, and turn natural resources into American riches and dreams.” He also highlighted “front‑line coal workers” as essential to keeping America “running at full speed.”
Current Coal Landscape in the United States
Coal production has been on a steep decline for decades. Output fell by more than half between 2008 and 2023, reaching 578 million tonnes in the latter year, according to the U.S. Energy Information Administration. In 2023, coal accounted for about 16 percent of U.S. Energy production, trailing natural gas (43 percent) and renewables (21 percent).
A 2023 analysis by Energy Innovation found that 99 percent of coal‑powered facilities are more expensive to operate than replacing them with renewable alternatives. Despite this, the Trump administration has forced at least five plants to extend operations beyond their scheduled retirement dates and has added Trump‑appointed members to the Tennessee Valley Authority board after removing three members appointed by the previous administration.
Potential Future Trends
1. Increased Military Reliance on Coal
By formalising long‑term contracts, the DoD could lock in coal electricity for years to come. This may create a niche market where coal plants receive steady revenue streams, potentially delaying plant retirements despite higher operating costs.
2. Heightened Cost Pressures from Renewables
Given the Energy Innovation finding that most coal plants are costlier than renewable replacements, the Pentagon could face higher electricity bills compared with a shift toward solar, wind, or hydro power. Future budget reviews may weigh these cost differentials heavily.
3. Legal and Regulatory Challenges
Environmental groups are likely to challenge the order on the grounds that it conflicts with federal climate goals and the United States’ prior commitments under the Paris Agreement. Court rulings could influence the durability of the coal procurement strategy.
4. Potential Policy Reversals
Should a future administration prioritise climate action, the coal‑purchase mandates could be rescinded or altered, creating uncertainty for coal plant investors and the defense sector alike.
5. Technological Innovation in “Clean Coal”
Trump’s promotion of “beautiful, clean coal” suggests a push for carbon‑capture or efficiency upgrades. But, the $175 million upgrade fund may be insufficient to achieve breakthrough emissions reductions without further federal investment.
Did You Know?
Even before the recent order, the U.S. Energy Department had already extended the operating life of several ageing coal plants, illustrating a pattern of federal support for the sector despite market trends favouring renewables.
Pro Tip for Energy Professionals
When evaluating long‑term contracts, compare the levelised cost of electricity (LCOE) across fuel types. Coal’s higher LCOE, as highlighted by Energy Innovation, can erode profit margins when renewable alternatives become cheaper.
Frequently Asked Questions
- Will the Pentagon’s coal purchases affect U.S. Climate goals?
- Yes. Buying coal electricity could increase emissions, making it harder to meet national greenhouse‑gas reduction targets.
- How much money is being spent on coal plant upgrades?
- The Department of Energy will invest $175 million to modernise six coal facilities in the Appalachian and Atlantic regions.
- Are coal plants cheaper than renewable alternatives?
- According to a 2023 Energy Innovation analysis, 99 percent of U.S. Coal plants are more expensive to run than replacing them with renewables.
- Can the order be reversed by a future president?
- Executive orders can be rescinded or altered by subsequent administrations, so the policy’s longevity is uncertain.
Explore More
Read our in‑depth analysis of the future of fossil fuels in America and see how other sectors are responding to the shifting energy landscape.
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Sources: Al Jazeera, The Washington Post, CNBC, The New York Times.
