The Trump administration’s recent injection of funds into U.S. coal may give the flagging industry a short-term boost. But it’s not a long-term play, as market forces will increasingly turn to renewables, experts say.
The move also threatens to make the United States an increasing outlier regarding efforts to lower emissions globally and fight back against climate change, possibly leading to geopolitical shifts.
The announced $625 million won’t go to new coal plants, but is rather a cash boost to help existing plants live a little longer. And while coal mining may help to keep the lights on for now, it will remain uncompetitive.
“The market has moved on,” said Mark McNees, Ph.D., director of social and sustainable enterprises at Florida State University. “Utilities are closing coal plants because shareholders demand returns, not because environmentalists demand it.”
Akshaya Jha, assistant professor of economics and public policy at Carnegie Mellon University, said about two-thirds of the planned 2025 power-plant retirements in the U.S. are coal-fired.
The country plans to retire 12.3 gigawatts of total generation capacity this year, a 65% increase from similar retirements in 2024, according to data from the government’s Energy Information Administration. Of that total, 8.1 gigawatts are coal-fired, an amount equivalent to 4.7% of the U.S. coal fleet in operation at the end of 2024.
The use of coal to generate electricity has fallen about 62% from its historic high in 2008, added Joe Govreau, vice president of metals and mineral research at IIR Energy.
Meanwhile, as the U.S. shifts its focus away from clean energy with its policy support of coal, China, which also continues to build large volumes of coal capacity, is increasingly positioning itself as a leader in green energy.
While China has commissioned 21 gigawatts of new coal-fired capacity during the first half of 2025, as well as permitting 25 gigawatts during the same period, it’s also beginning to corner the market with its focus on renewable energy, according to Britt Burt, senior vice president of power industry research at IIR. The new coal capacity comes on the back of a staggering 94.5 gigawatts of new coal plants China started construction on in 2024. The U.S., by contrast, is not building any new coal plants.
Mark McNees of Florida State University said, “We’re ceding technological leadership to China while subsidizing yesterday’s technology. China controls 80% of solar manufacturing and dominates battery supply chains.”
And therein may lie another problem. As China builds its renewables capacity and global leadership, the U.S. will find itself in a difficult position when it does eventually return its gaze to green energy.
New tilt?
The renewed U.S. focus on coal could also open up a geopolitical shift.
In addition to China, Europe and India are also expanding their focus on renewables, even as China remains a massive coal producer and India mixes its energy provision with fossil fuels. At the same time, the U.S. could be seen as withdrawing its global influence as it moves to support fossil fuels, such as coal.
“As these countries strengthen their positions in future clean-tech markets, a U.S. retreat from climate cooperation risks ceding both diplomatic credibility and technological leadership,” argued Sunil Kansal, head of consulting at U.K.-based Shasat. “In the longer term, the world is more likely to align with economies that combine growth with environmental responsibility, an axis increasingly led by China, India, and Europe if the US continues down this path.”
While Burt argued that the continued building of coal-fired plants in China, India, and Southeast Asia will prevent the world from tilting away from the U.S. and more toward these regions, he said there is little doubt that China is positioning itself as a green energy giant in a bid to increase its global power.
While its pledges on emissions are not close to where they would need to be, China is presenting itself as a clean energy leader at the same time as the U.S. withdraws from global norms. In September, China announced an updated Nationally Determined Contribution to reduce its greenhouse gas emissions between seven and 10% below peak levels by 2035.
Shorter- (and longer)-term
The bump in coal support may appear to make some sense, given that renewables deployment costs have risen in recent years due to higher interest rates, supply bottlenecks, and materials inflation, making the short-term economics of fossil energy appear more stable, according to McNees.
But he and every other source contacted for this article said coal will continue long-term to be uncompetitive while spending will increasingly focus on renewables.
The energy mix may include coal for now, but with rising demand for electricity — U.S. demand alone is expected to grow at least 2% — it can only be a part of the solution, and it is largely misguided to focus overly on it, they say.
“Washington is prioritizing short-term energy security and domestic jobs over long-term transition goals,” said Kansal. “While this policy offers political and industrial benefits, it risks locking the U.S. into aging, high-emission infrastructure at a time when most peers are diversifying energy portfolios and pursuing carbon-neutral growth.”
McNees agreed.
“The opportunity exists for the U.S. to reclaim leadership, but not by doubling down on coal,” he said.
Nick Thomas is a writer based in Denver.
