Trump announces $700m coal investment using wartime powers

The announcement

Donald Trump has announced a $700 million investment in the US coal industry, invoking the Defense Production Act to bypass standard approval processes. The president made the announcement at the White House on Thursday, framing coal as “beautiful, clean coal” and positioning the investment as protection for American consumers against energy price rises since the war with Iran.

The package allocates $500 million to preserve 14 existing coal plants across ten states: Kentucky, North Carolina, Indiana, Tennessee, Arkansas, Arizona, Oklahoma, North Dakota, Wisconsin and West Virginia. It also includes funding for a new export terminal in Oakland, California. A further $200 million will fund two new coal plants in Alaska and West Virginia. These would be the first new coal plants in the US since 2013.

Trump claimed the package would save American consumers $50 billion in energy generation costs and create approximately 14,000 jobs. The Oakland export terminal alone is said to deliver 1,400 positions.

The context: energy prices and wartime powers

The investment follows a dramatic spike in US petrol prices. The average gallon of petrol stood at $4.24 on Thursday, according to AAA. This is up from $2.98 on the day the US and Israel began striking Iran. The closure of the Strait of Hormuz, a critical shipping route carrying around a fifth of global oil and gas supplies, has further tightened the market. Overall consumer energy prices rose 17.9% in the year to April, according to the Bureau of Labor Statistics.

Invoking the Defense Production Act, a Cold War-era law granting presidents broad authority to support industries deemed vital to national security, allows Trump to direct federal funds without standard congressional oversight. The administration argues coal is essential to national energy independence.

Climate experts push back

Environmental groups and climate scientists have responded with alarm. The investment locks in carbon-intensive infrastructure at a moment when international climate commitments require rapid coal phase-out. Critics note that the “clean coal” framing contradicts overwhelming scientific consensus on coal’s environmental impact.

The Sierra Club called the announcement “a bailout for dying industries that will accelerate the climate crisis.” The group argues that the $700 million would be better directed toward renewable energy transition and retraining programmes for coal workers.

Labour unions representing renewable energy workers have also expressed concern. They note that fossil fuel infrastructure investments create fewer long-term jobs than clean energy alternatives per dollar spent.

The jobs claim scrutinised

Trump’s job creation figures stand in tension with Bureau of Labor Statistics data. US coal employment has fallen from over 90,000 workers in 2012 to under 50,000 in recent years. This decline is driven by automation and market forces, not environmental regulation. Experts suggest the 14,000 jobs figure overstates employment impacts while understating the ongoing contraction of the sector.

What the coal communities face

For communities in the targeted states, the announcement offers partial relief to aging coal plants facing closure. But workers and local officials familiar with the industry’s decline caution that infrastructure spending alone cannot reverse fundamental market shifts away from coal toward natural gas and renewables.

The export terminal in Oakland, if built, would primarily serve international markets, particularly in Asia. This means much of the extracted coal would leave US shores while local communities bear the environmental costs of mining, transport and processing.

The Trump administration has not detailed how it will address the contradiction between domestic coal investment and international climate commitments the US has signed.