Is President Donald Trump quietly giving up on coal power, even as he noisily supports it?
The Trump administration appears to be backing away from its widely criticized plan to bail out the coal industry. At the same time, U.S. coal power generation hits a 35-year low, and coal company bankruptcies are increasing.
Candidate Trump campaigned on ending the supposed “war on coal.” And just four months ago, he ordered Energy Secretary Rick Perry to take “immediate steps” to bail out unprofitable coal (and nuclear) plants.
As recently as August, the president traveled to West Virginia to tell supporters he had a “military plan” to save coal power plants. But during a late September rally in the state, he dropped any mention of such a plan.
Then on Monday, Politico reported that “the White House has shelved the plan amid opposition from the president’s own advisers on the National Security Council and National Economic Council.”
Ultimately, it seems Perry simply had no idea how to pay for the multi-billion dollar bailout, and the most likely source of money was inevitably going to be U.S. ratepayers, especially in the red states that had the most uneconomic coal plants.
While Trump is notorious for changing his mind on a whim, for now it appears that the administration has no answer to the reality of the marketplace: coal power plants have become increasingly unprofitable in the face of cheap fracked gas and the rapidly declining costs for wind, solar, battery storage, and energy efficiency.
So, it’s no surprise U.S. coal power generation just hit a level under Trump not seen since 1983, as Trump’s own Energy Information Administration reported recently. Indeed, Reuters notes that coal use by power producers “fell to 298 million short tons in the first half of 2018,” the lowest level in 35 years.
What’s more, in the past several days, multiple coal companies have declared bankruptcy. This includes Pinnacle Mining Company, Mission Coal Company, and a number of related coal and mining companies. At the same time, Colorado-based Westmoreland Coal, one of the country’s oldest coal companies, also declared bankruptcy.
Ironically, one of the only bright spots for the domestic coal mining industry has been increased exports to Asia. But even that maybe threatened by Trump’s growing trade war with China.
The bottom line is that coal power generation is all-but certain to continue its steady decline under Trump. Shelving the coal bailout plan may be a sign the Trump administration is starting to wake up to this marketplace reality.