Administration to allocate $700 million to coal plants under Defense Production Act

The administration announced it will use the Defense Production Act to distribute $700 million in grants to coal-fired power plants across the United States. The funds target more than a dozen existing facilities, some of which can export coal. The move continues prior administration actions that have provided hundreds of millions of dollars to the coal sector in the past year.

Those steps included orders requiring ratepayers to cover costs for older plants and the removal of environmental limits on toxins released into air and water.

Industry and advocacy responses A coal industry group stated that increased coal output would help meet rising electricity demand linked to artificial intelligence growth. The group said coal generation protects consumers from price swings and supply issues.

Environmental organizations criticized the grants. One group said the funding would raise electricity costs and increase health risks from plant emissions. Another group called the spending a misallocation of taxpayer resources.

Production trends U.S. coal employment has fallen more than 90 percent over the past century. Current production stands at less than half the 2008 level, with natural gas and renewables supplying larger shares of electricity generation.