Coal’s comeback: Report says old plants could power AI boom

The 370 coal-fueled generating plants across 37 states are among the nation’s most valuable and immediate sources of energy, according to a new report released by the National Coal Council.

Coal plants can help the United States respond to growing electricity demand from artificial intelligence, advanced manufacturing, electrification, and broader economic growth, said “Maximizing the Value of the U.S. Coal Fleet,” which was submitted in July to U.S. Energy Secretary Christopher Wright.

“Electricity is the lifeblood of the United States, and the American electricity grid now faces one of its greatest challenges in generations,” according to the 44-page report.

The demand for energy is expected to increase by 1% in 2026 and 3% in 2027, according to the U.S. Energy Information Administration. The energy increase is driven by data centers and large computing facilities. Data centers consumed about 4% of all U.S. electricity in 2023 and are projected to consume approximately 6% to 12% of total U.S. electricity by 2028, according to a 2024 study from Berkeley Lab. There are over 3,000 data centers in the U.S. Roughly 1,214 are operating and 1,788 are planned, according to Cleanview, which tracks data centers.

Unlike wind and solar energy, which are intermittent, coal provides immediate energy needed during freezing temperatures or when renewable energy isn’t available. For example, coal helped warm homes and saved ratepayers more than $1 billion the day Winter Storm Fern peaked in January 2026, according to the report.

In addition, the coal fleet responded to the freezing weather by increasing its electricity output more than any other source that day, the coal group noted.

Since 2011, U.S. policy and regulations have retired coal-fueled generation that powered 62 million households, the report said.

“Running existing coal plants at historic capacity utilization levels could satisfy several years of growth for the U.S. grid and, by itself, solve much of our near-term electricity crunch,” said Jim Grech, coal council chair and president and CEO of Peabody Energy, who helped lead development of the report. “Proven U.S. coal reserves are larger than any other nation’s single energy reserves – larger than all the oil in Saudi Arabia and all the natural gas in Russia. We should be taking full advantage of this extraordinary American asset to propel our economy and improve the lives of Americans.”

The report calls on the U.S. Department of Energy, other federal agencies, grid operators, and Congress to prevent premature retirements of coal-fired electricity plants.

The report finds that increasing the output of existing coal plants to levels they have historically achieved could satisfy years of projected demand growth, promoting economic growth and strengthening national security.

“This report makes clear that preserving and better utilizing our existing coal fleet is one of the simplest, fastest, and most affordable ways to help meet growing electricity demand,” said Michelle Bloodworth, chair of the National Coal Council Electricity Subcommittee and president and CEO of America’s Power, a coal group. “Allowing dependable coal power plants to retire while electricity demand is accelerating would worsen an already difficult problem and strain families and businesses across the country. For example, the report estimates that replacing only a portion of the existing coal fleet with wind and solar resources could cost ratepayers an additional $3 billion or more per year. We should be strengthening the dependable resources we already have, not forcing them off the grid.”

The report provides 19 recommendations across four categories of how coal can help maintain a reliable grid with affordable energy:

• Reforming regulations and providing greater policy certainty, including changes to EPA regulations, streamlined federal coal leasing, and congressional action to establish a more predictable regulatory environment.

• Reforming electricity markets and creating appropriate incentives, including minimum offer price rules, expanded reliability-must-run agreements, proper valuation of reliability attributes, and providing incentives for bilateral contracts between large electricity loads and existing coal plants.

• Providing financial support for the coal fleet and its supply chain, including DOE grants and loans, federal power purchase agreements, and investments in critical infrastructure.

• Supporting the development of new coal plants through grants and loan guarantees and by identifying and removing regulatory, financial, and other barriers to constructing new plants.