Trump pumps coal as answer to AI power needs but any boost could be short-lived

[January 25, 2025]  By MEAD GRUVER and MATTHEW BROWN

CHEYENNE, Wyo. (AP) — President Donald Trump’s promise to go all in on fossil fuels includes praise for coal, a reliable but polluting energy source that's long been in decline.

Trump this week suggested coal can help meet surging electricity demand from manufacturing and the massive data centers needed for artificial intelligence.

“Nothing can destroy coal. Not the weather, not a bomb — nothing," Trump told the World Economic Forum in Davos, Switzerland, by video link Thursday. “And we have more coal than anybody.”

Yet energy experts say any bump for coal under Trump is likely to be temporary since natural gas is cheaper and there’s a durable market for renewable energy no matter who holds the White House.

“It's kind of been shown over the last three administrations even the president of the United States can't change markets, the trend for coal," said University of Wyoming economics professor Rob Godby. "It might lead to a reprieve."

Here's a look at the outlook for coal during Trump's second term:

AI WILL REQUIRE MORE ELECTRICITY

Efficiency gains have plateaued electricity demand in the U.S. for 15 years, but that's changing. More manufacturing, more electric vehicles, and energy-hungry computing centers necessary for artificial intelligence are poised to strain the system.

Electricity demand for data centers alone will increase 10-20% per year through 2030, while manufacturing of batteries, solar cells and semiconductors will require additional gigawatts of new power over the next four years, predicted Chris Seiple with analyst firm Wood Mackenzie.

While the tech industry is used to churning out new products to meet changing demand, electric utilities are not. Power plants and transmission lines often take decades of planning.

“The Trump administration is a four-year administration. It’s really difficult for utilities to make investment decisions in four-year windows,” Godby said.

A REPRIEVE FOR SOME OLD COAL PLANTS

Trump this week issued executive orders calling for prioritizing energy development, such as by lifting regulations that impede development of fossil fuels.

That could lead to repeals of President Joe Biden's power plant pollution regulations and an end to some policies that support renewables.

Environmentalists cringe at the implications for climate change — electricity generation accounts for one-quarter of U.S. carbon emissions, according to the EPA — but miners welcome the shift.

Unlike solar and wind power, which are subject to vagaries of sunlight and weather unless they're paired with battery storage, coal-fired electricity can run around the clock with only periodic downtime for maintenance. Supporters say the nonstop power from coal meets the needs of technology facilities.

But while tech firms that want off-the-grid power might invest in a “dirt cheap” coal-fired power plant, Godby said, such plants need time to fire up. They aren't very good for the kind of on-the-spot backup power Trump was referring to in addressing the Davos conference.

Surging demand is expected to prompt delays in plans to retire coal-fired power plants. That's already been happening with plants in Maryland, Indiana and Illinois.

For utilities, Trump's comments were “a blank check to do whatever you want” in the short term despite prior attempts to address carbon dioxide emissions and expand renewables, said S&P Global analyst Dan Thompson.

But Thompson noted three of the companies driving the data center boom — Google, Amazon and Microsoft — are the biggest corporate purchasers of renewable power and have made commitments to reach carbon neutrality.

AES Indiana Petersburg Generating Station, a coal-fired power plant, operates in Petersburg, Ind., on Wednesday, Oct. 25, 2023. (AP Photo/Joshua A. Bickel, File)

That suggests a reprieve, not a comeback, for coal.

“It’s natural gas that will benefit the most from rising electricity generation,” Seiple said. “It’s very unlikely we will see new coal plants due to how expensive they are.”

COULD TRUMP TAP PUBLIC COAL RESERVES?

The U.S. has some of the largest coal reserves in the world — enough to last more than 400 years at current mining rates, according to the Energy Information Administration.

The industry relies heavily on reserves on public lands in the West, particularly the Powder River Basin of Wyoming and Montana.

Sales of those reserves have long been politically contentious. Trump in his first term reversed a moratorium on government coal sales imposed under former President Barack Obama.

The Biden administration also sought to ban new coal sales in the closing days of his administration. The decision ws projected to result in mines depleting their federal coal reserves as early as 2035 — decades earlier than if leasing continued.

When Sen. Jon Barrasso asked Trump Interior secretary nominee Doug Burgum about the ban during his confirmation hearing, Burgum replied he would “absolutely” work with the Wyoming Republican to reverse the ban.

Burgum also pledged to work with Montana Republican Sen. Steve Daines to advance pending coal mine expansion permits in the lawmaker’s state.

“We have a shortage of electricity and especially we have a shortage of baseload. We know that we have the technology to deliver clean coal,” Burgum said. He referenced efforts at a coal to gas plant in North Dakota — where he was governor — to capture and sequester carbon dioxide that would otherwise warm the planet.

Research has shown carbon capture is feasible and useful to boost aging oil field production. Scientists have questioned the practicality of commercial-scale, permanent sequestration of carbon dioxide from burning coal and other fossil fuels.

US COAL EXPORTS RISE

Global coal production was expected to an all-time high last year, approaching 10 billion tons (9 billion metric tons), according to the International Energy Agency.

The biggest demand is in Asia, where countries including China continue to build new coal-fired power plants as their economies expand.

U.S. coal companies have sought to capitalize on that growth by exporting more coal. They've been hindered by a lack of port access on the West Coast.

To get around opposition to new ports, Republicans during Trump’s first term considered but never acted on a plan to use West Coast military bases or other federal properties as fossil fuel export sites.

U.S. exports last year were expected to top 100 million tons for the second year in a row. Top destinations included India, China, Brazil, Japan and the Netherlands.

“There is strong global appetite for coal and U.S. producers are ready to answer that need,” said National Mining Association president Rich Nolan.

Overall U.S. coal production is forecast to continue declining.

“The long-term trend is hard to get out of," Godby said.

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