Energy's Odd Couple

Coal gets a major boost from the DOE, with AI as its sidekick

American coal production is getting a federal boost, with an intriguing link to artificial intelligence as part of the reasoning. The U.S. Department of Energy (DOE) announced a $625 million investment September 29 “to expand and reinvigorate America’s coal industry,” aiming to boost energy production and support coal communities nationwide. The funding announcements are issued in accordance with two executive orders, “Reinvigorating America’s Beautiful Clean Coal Industry,” and “Strengthening the Reliability and Security of the United States Electric Grid.”

“Beautiful, clean coal will be essential to powering America’s reindustrialization and winning the AI race,” U.S. Secretary of Energy Chris Wright said when announcing the decision. “These funds will help keep our nation’s coal plants operating and will be vital to keeping electricity prices low and the lights on without interruption. Coal built the greatest industrial engine the world has ever known, and it will help do so again.” The connection between coal and AI? Data centers and their massive electrical demands, according to the DOE, which opened federal land for the development of power plants and data centers earlier this year. So far, the department has received some 300 inquiries, Wright said.

A global race to dominate AI could depend largely on connecting new electricity supplies. For context, China built 100 gigawatts of coal-fired power last year and another 100 gigawatts are under construction, Wright said.

The $625 million will reportedly be allocated as follows: More than half of the investment (approximately $350 million) will go to coal recommissioning and retrofitting, “for projects to demonstrate readiness to recommission or modernize coal power units and provide near-term electric power reliability and capacity.”

Another $175 million is designated for rural capacity and energy affordability projects. This is for “coal power projects that provide direct benefits of energy affordability, reliability, and resiliency in rural communities.”

Next, $50 million will be used to support the development and implementation of advanced wastewater management systems. $25 million is for the engineering and implementation of dual firing retrofits, enabling coal power plants to switch between fuels, achieve full steam capacity, and economic flexibility to extend plant lifespans. The final $25 million is for the development and testing of natural gas cofiring systems, which support investments that will maintain boiler efficiency and reliability when utilizing 100% natural gas.