Coal Industry Bailout – Could It Happen?

coal industry

The coal industry has seen tighter regulations and some challenges posed by natural gas over the past decade.

But if the Trump administration has its way with a controversial new plan, the coal industry could receive what amounts to a bailout from government intervention in the market.

In June, President Trump directed Energy Secretary Rick Perry to take steps to keep coal and nuclear plants open, to both maintain jobs in the industry and protect what the administration calls a national security issue.

The main thrust of the plan is a directive for energy purchasers to buy electricity from coal and nuclear power plants, which would be a radical and unprecedented intervention in the energy market, according to experts. The 41-page memo that outlined the proposed policy stated that the federal government would be acting under the 1950 Defense Production Act and the Federal Power Act as a way to keep coal plants open for national security reasons.

The national security argument refers to the need, as stated by the Trump administration, to maintain a stable mix of energy sources that include coal and nuclear as a way to avoid “impacting the resilient of our power grid,” according to a statement from press secretary Sarah Huckabee Sanders.

Any such policy that would be enacted, however, would likely face a stiff legal challenge from a variety of industry and consumer advocacy sources.

It’s no secret, though, that the Trump administration – and many in Congress who come from coal-producing states – have sought a way to stem the bleeding in the industry and keep plants from shutting, which cost jobs. Even in 2017, the sector still was able to gain 771 jobs.

It remains to be seen if the policy will be enacted. A similar proposal was rejected by bipartisan federal regulators in 2017, which gave rise to the new proposal. The plan shows the Trump administration’s ongoing commitment to the coal industry, as evidenced by the loosening of regulations from the EPA. Whether this plan will be enacted may become apparent in the coming months.

ProcessBarron designs, engineers, and installs bulk materials handling, ash handling, and air handling equipment for the power industry. Contact the team for more information on the company’s services, or to get a free quote on a new project.