The Coal Trader

Will the War on Coal Leave America in the Dark?

As the United States squeezes out its remaining coal plants, experts worry about the grid; meanwhile China and India expand their coal capacities exponentially.

As the Biden administration promises to eliminate coal power throughout the United States, energy experts are sounding the alarm about what will be left of U.S. energy infrastructure if these plans succeed. U.S. climate envoy John Kerry said on Dec. 2 at the U.N. COP 28 global warming summit that the Biden administration “will be working to accelerate unabated coal phase-out across the world, building stronger economies and more resilient communities.”

President Joe Biden said recently of coal plants, “We’re going to be shutting these plants down all across America and having wind and solar power.”
To achieve its net-zero goals, the Biden administration has leveraged the Environmental Protection Agency (EPA) and its authority under the 1970 Clean Air Act to launch a fundamental restructuring of the U.S. electricity infrastructure.

In May, the EPA proposed new rules that set much stricter limits on carbon dioxide (CO2) emissions from coal and natural gas plants.

“EPA projects these proposals would cut 617 million metric tons of CO2 through 2042 along with tens of thousands of tons of … harmful air pollutants that are known to endanger public health,” the EPA stated.

Despite the unambiguous statements from the Biden administration that it’s ending coal production in the United States, supporters of the EPA’s new rules insist that coal plants will be able to comply and continue to operate. Rep. Paul Tonko (D-N.Y.) said at a House Committee on Energy and Commerce hearing in June that the EPA’s new emission rules are “reasonable” and “a far cry from a government takeover of our power sector.”

“This is ultimately a modest rule that builds upon the Inflation Reduction Act, which will further support cost-effective compliance with the proposed standards,” he said. “This proposal provides ample flexibility to entities [to comply].”

However, critics of the EPA’s new rules say limits are set so tight that coal plants will be forced to close.

“It’s death by a thousand paper cuts,” Michael Nasi, an environmental attorney who provided testimony at the congressional hearing, told The Epoch Times. “They’re putting out a slew of regs that are intended to basically eviscerate the remaining coal fleet.

“This rule is not happening in isolation. We have three or four other major environmental rules that EPA is chasing.”

They include the EPA’s ozone transport or “good neighbor” rule, a Mercury and Air Toxics Standards rule, Regional Haze programs, and others.

The net result is that many coal plants are simply surrendering and shutting down well before the end of their productive life. This includes the newer plants, which are among the cleanest-burning coal plants in the world.

“Everything that’s left in the U.S. fleet is not a bunch of dirty old coal plants; these are the plants that made the retrofits necessary to extend their lives,” Mr. Nasi said. “They are the newer plants, the ones that actually were so vital that more investment was made.”

A 2020 report by the U.S. Department of Energy states that “coal-fired electricity generation is cleaner than ever.”

The report cites research by the National Energy Technology Laboratory that shows “a new coal plant with pollution controls reduces nitrogen oxides by 83 percent, sulfur dioxide by 98 percent, and particulate matter by 99.8 percent compared to plants without controls.”


A man works in the control room of the East Kentucky Power Cooperative’s John Sherman Cooper power station near Somerset, Ky., on April 19, 2017. (Nicholas Kamm/AFP via Getty Images)

 Mr. Nasi said that’s what makes the EPA’s added regulations “even more offensive.”

“These units all made investments on the assumption that the EPA would stay within the Clear Air Act and that once they made those changes, they would be deemed to be in compliance,” he said. 

“These coal plants acted in good faith … and now they’re being told that’s not good enough, and here’s some new regulations that you will not be able to comply with.

“What the EPA is doing is going well beyond the letter and intent of the law on several different pollutants, and carbon is, of course, the biggest of them all.”

Despite the coal industry’s progress in reducing pollution, the only solution that global warming activists appear willing to accept is the abolition of coal. 

report by ODI, a proponent of wind and solar energy formerly known as the Overseas Development Institute, concedes that the thermal efficiency of burning coal to make electricity has increased to 50 percent from 30 percent, with the result being that 40 percent less CO2 is produced.

“This is impressive, but it’s not enough,” the ODI stated. “Even the most advanced coal plant produces around 30 times more CO2 than wind and hydro, 20 times more than solar and geothermal, and 50 percent more than natural gas.” 

 Larry Fink, CEO of BlackRock, speaks at a roundtable discussion titled "Financing the New Climate Economy," during which he described the urgent need for a "new financial landscape" for funding investments into the global energy transition at the United Nations COP 28 Climate Conference in Dubai, United Arab Emirates, on Dec. 4, 2023. (Sean Gallup/Getty Images)
Larry Fink, CEO of BlackRock, speaks at a roundtable discussion titled “Financing the New Climate Economy,” during which he described the urgent need for a “new financial landscape” for funding investments into the global energy transition at the United Nations COP 28 Climate Conference in Dubai, United Arab Emirates, on Dec. 4, 2023. (Sean Gallup/Getty Images)

‘Largely Uninvestable’

Global banks and asset managers have joined the fight against coal, working within the environmental, social, and governance (ESG) movement to cut off financing for the coal industry.

According to a report by InfluenceMap, a data analytics firm, more than 500 investment managers, with $1.4 trillion in assets under management, pledged to divest from coal, making coal plants “largely uninvestable.”

report in May by the Institute for Energy Economics and Financial Analysis listed more than 200 international banks, insurance companies, export credit agencies, and development banks that are divesting from coal. The companies include global powerhouses such as AIG, Allianz, AXA, Bank of America, Barclays, BlackRock, Citibank, Fidelity, Goldman Sachs, JPMorgan Chase, and UBS.

Caught between the Biden administration and Wall Street, the U.S. coal industry is withering.

Nearly 13 gigawatts of coal generation capacity was shut down in 2022—double the amount of production that was shuttered in 2021, according to the American Public Power Association.

An additional 41 gigawatts of coal capacity is scheduled to be shut down by 2027.

Overall, 83 gigawatts of coal, gas, and nuclear power generation are scheduled to be shut down over the next decade as the United States embarks on what President Biden calls the “incredible transition” to wind and solar energy.

The United States currently has approximately 1.3 terawatts of electricity generation capacity in total.

Shutting Down Faster Than Replacing

Energy experts are sounding the alarm about the dangers of this transition, warning that the U.S. electric grid is becoming increasingly unstable as a result.

The North American Electric Reliability Corp. (NERC), an organization charged with monitoring the reliability of the U.S. grid, stated in its December report that there’s “clear evidence of growing resource adequacy concerns over the next 10 years,” because coal and gas plants are being eliminated faster than new capacity is being added.

The NERC’s risk assessment identifies a broad segment of the central United States, from Minnesota to Louisiana, as “high risk,” meaning that blackouts can occur under normal conditions.

All of the states to the west of this area, as well as all of the northeastern U.S. states, are identified as “elevated risk,” meaning that electricity shortages can occur during times of very high or low temperatures.

And the NERC isn’t alone in its assessments.


A backyard overlooks the valley to the GenOn Cheswick Power Station, which still burns coal to produce 637 megawatts of electricity for the region, about 15 miles northeast of Pittsburgh in Cheswick, Pa., on June 7, 2021. (Jeff Swensen/Getty Images)

PJM Interconnection, a regional electricity transmission company that serves 13 states and the District of Columbia, stated in a February report that while it remains committed to shutting down coal and gas plants, the construction of new wind and solar facilities to replace them “would be insufficient to keep up with expected retirements and demand growth by 2030.”

The report notes significant growth in electricity demand, given the push to transition cars, stoves, and home heating onto the electric grid.

At the same time, the report states that “thermal generators [coal and gas] are retiring at a rapid pace because of government and private sector policies as well as economics, [and] retirements are at risk of outpacing the construction of new resources because of a combination of industry forces, including siting and supply chain, whose long-term impacts are not fully known.”

New capacity, PJM stated, “is composed primarily of intermittent and limited-duration resources.”

“Given the operating characteristics of these resources, we need multiple megawatts of these resources to replace 1 MW of thermal generation,” it stated.

Of the capacity being eliminated, 60 percent will be coal and 30 percent natural gas.

Because wind and solar are “intermittent,” or weather-dependent, the amount of electricity that they actually generate is a fraction—typically about one-fourth—of their capacity, requiring multiples more capacity of renewables to be built to replace coal, gas, or nuclear.

“For the first time in recent history, PJM could face decreasing reserve margins should these trends continue,” the company stated.

Reserve margins refer to the excess capacity that electric utilities keep on hand to meet periods of unexpected demand or supply shortages.

Rest of World Adds Coal Capacity

As the United States races to eliminate coal as an energy resource, the world’s most populous and rapidly growing countries, most notably China and India, are charging ahead.

China has been aggressively expanding its coal capacity, starting construction on 37 gigawatts of new coal capacity in the first half of 2023 alone, according to a report by the Centre for Research on Energy and Clean Air.

China has more than 90 gigawatts of new coal capacity in various stages of development. Worldwide, 41 percent of the world’s electricity is generated with coal.

With so much coal capacity coming online, it makes little difference what the United States does with its coal industry, in terms of reducing global CO2 emissions. And ironically, the U.S. drive for renewable energy is fueling the expansion of new coal capacity abroad.


Coal is stored at a facility operated by the Jiangsu Xinhai Power Generation Co., in Jiangsu Province, China, on July 14, 2023. (Stringer/AFP via Getty Images)

China needs this additional coal capacity to keep up with the West’s demand for EVs, solar panels, and wind turbines.

More than 80 percent of the world’s solar panel manufacturing capacity is in China, which also refines more than 95 percent of manganese, 70 percent of cobalt and graphite, and more than 60 percent of lithium and nickel—some of the essential elements for EV batteries.

What makes coal so attractive as an energy source is that it’s cheap, plentiful, and transportable by ship, rail, or truck. It can be stored onsite at power plants, making it one of the most reliable and affordable power sources. It also adds to the diversity of a country’s energy resource mix, providing some degree of safety against weather events and political embargoes, as Europe learned to its dismay after Russian supplies of natural gas were abruptly cut off.

Coal-fired plants are also “dispatchable,” allowing power plants the flexibility to quickly adjust output as needed, in order to match supply with demand. Natural gas plants are also dispatchable but require continuous delivery of gas to function, and for this reason, they’ve been prone to outages in cold temperatures.

There are more than 892 billion metric tons of proven coal reserves worldwide, which could meet current demand for more than a century, according to the National Coal Council.

 Coal miners push a trolley laden with coal inside an underground tunnel of a mine at Godavarikhani, some 150 miles east of Hyderabad, India, on July 27, 2007. (Noah Seelam/AFP via Getty Images)
Coal miners push a trolley laden with coal inside an underground tunnel of a mine at Godavarikhani, some 150 miles east of Hyderabad, India, on July 27, 2007. (Noah Seelam/AFP via Getty Images)

This supply is about 17 times larger than known reserves of oil and gas, and more than one-fourth of the world’s coal reserves are located in the United States.

The downside of coal is that it emits more pollution than other fuel sources, although wind and solar facilities generate enormous amounts of CO2, as well as toxic chemical pollutants, during the extraction, transport, and refining of mineral components.

The Rise and Fall of US Coal

Coal became the dominant fuel for electricity generation in the United States in the mid-20th century and reached its peak in 2007, when more than 1 billion short tons were consumed. It remains an abundant energy resource in the United States.

The decline of coal in the United States began with the rise of fracking and the supply of cheaper, cleaner-burning natural gas. The transition to natural gas is the primary reason that the United States now leads the world in reducing CO2 emissions.

Currently, 43.7 percent of U.S. electricity generation capacity comes from natural gas, 17.1 percent from coal, 11.3 percent from wind, 8 percent each from nuclear and hydro, and 6.5 percent from solar.

This mix will shift dramatically toward renewables in the coming years, with 58 percent of the additions to capacity projected to be solar, 18 percent wind, and 21 percent natural gas.

Much of this investment benefits from government subsidies, including the so-called Inflation Reduction Act, which provides tax breaks for the manufacturing of components for solar and wind energy. This bill was passed with the support of Sen. Joe Manchin (D-W.Va.), a Democrat from the coal-dependent state of West Virginia.


Wind turbine towers sit under construction at CS Wind, the largest wind turbine tower manufacturer in the world, in Pueblo, Colo., on Nov. 29, 2023. (Michael Ciaglo/Getty Images)

An October report by Goldman Sachs states that the legislation, signed in August 2022, has already launched more than $110 billion in new clean-energy manufacturing investments. The government subsidies, together with mandates that require utilities to prioritize buying energy from wind and solar plants over gas and coal, make it difficult for coal and gas plants to operate profitably.

During the times when wind and solar plants are operating, their variable costs are low, and the capital costs of building them and the transmission lines to connect them into the grid are often subsidized by taxpayers or passed on to customers in the form of higher utility bills.

Despite the argument that wind and solar energy are cheaper, in places where the transition to renewables has been implemented, electric bills have escalated sharply. One country that’s decades ahead of the United States in its transition to wind and solar is Germany, which went all-in on its renewables bet, mothballing its coal plants and shutting down its nuclear plants.

As this policy failed to deliver reliable electricity for residents and Germany’s industrial sector, and as the cost of electricity skyrocketed, Germany brought its coal plants back online. However, the United States likely won’t have this option. Here, when plants are shut down, they aren’t kept in a state in which they can be fired up again.

“We have a market-based system, and if the EPA makes it impossible to deploy capital quickly enough to survive, the unit is retired,” Mr. Nasi said.

“It is deconstructed and melted, the steel is recycled, and the workforce is let go.”

Therefore, the elimination of coal energy from the U.S. energy mix may prove to be long-lasting, if not permanent.