With the recent executive order directing the U.S. military to purchase coal-generated power, the White House has placed energy policy at the heart of its national security strategy. This move aims to leverage America’s coal resources to ensure a resilient and reliable power grid for critical defense installations. To unravel the implications of this directive, we spoke with Christopher Hailstone, a leading expert in energy management, renewable energy, and electricity delivery, who provides critical insights into the delicate balance of grid security, economic reality, and environmental considerations. His analysis explores the operational benefits of on-site fuel security, the market impact on a declining coal industry, and the long-term forecast for America’s energy landscape under this new policy.
The executive order directs the Department of War to buy coal-generated power, citing the need for resilient and reliable energy for military installations. What specific grid vulnerabilities does this address, and what are the operational benefits of relying on coal for on-site fuel security?
The directive is squarely aimed at the vulnerability of our military bases to disruptions in the commercial power grid. An adversary doesn’t need to attack a base directly; they can target transmission lines or natural gas pipelines miles away and effectively cripple operations. The key benefit of coal here is “on-site fuel security.” Unlike a pipeline that can be severed or a grid that can go down, a coal plant can maintain a massive stockpile of fuel—weeks or even months’ worth—right on its premises. This creates an island of power that can operate independently, ensuring that critical defense systems, from command centers to airfields, remain fully functional during a regional blackout or a coordinated attack. It’s about guaranteeing continuous, on-demand baseload power that isn’t dependent on the whims of weather for intermittent sources or a fragile external supply chain.
President Trump asserted that this move to coal power would be “less expensive” and “just as clean.” Considering current market trends and available environmental technologies, can you detail the economic and logistical trade-offs for the Department of War in prioritizing coal over other energy sources?
The claims of being “less expensive” and “just as clean” are quite ambitious and require careful examination. Economically, the market has been moving away from coal for a reason. With U.S. coal production falling over 11% in the last year and dozens of mines closing, it’s clear other sources are often more cost-competitive. Locking the Department of War into long-term power purchase agreements with specific coal plants is essentially a subsidy. It might be less expensive than, say, a complete grid failure, but it’s unlikely to be cheaper than power from a modern natural gas plant or a large-scale solar farm on the open market. Logistically, while you gain on-site fuel security, you also take on the burden of securing a physical supply chain for coal, which has its own complexities. The “just as clean” argument hinges on the phrase “environmental progress,” likely referring to scrubbers and other technologies, but these add cost and don’t eliminate emissions in the way that renewables do.
Given that U.S. coal production and consumption have recently fallen, with dozens of mines closing last year, what is the anticipated market impact of this directive? Could military power purchase agreements be substantial enough to stabilize or even reverse the decline in the domestic coal industry?
This directive will act as a targeted lifeline, not a market-wide resurrection. The data is stark: consumption dropped 3.5% last year, and the number of operating mines fell from 560 to 524. The scale of the military’s energy needs, while significant, is a fraction of the overall national market. Therefore, these power purchase agreements won’t be enough to reverse the fundamental economic trends pushing the industry into decline. What they will do is create a protected, guaranteed revenue stream for a select number of coal plants, likely those strategically located near key federal facilities. This will certainly save those specific plants from closure and support the mines that supply them, but it’s more of a strategic carve-out than a broad reversal of the industry’s fortunes.
The order tasks Secretary of War Pete Hegseth and Energy Secretary Chris Wright with approving new power purchase agreements. What criteria should they use to prioritize certain coal facilities, and what are the step-by-step challenges in integrating these agreements with existing federal infrastructure?
Their primary criteria are spelled out directly in the order: strengthening grid reliability, preventing blackouts, and enhancing on-site fuel security. In practice, this means they’ll likely prioritize coal plants that are either geographically close to critical military installations or can be directly connected to them with hardened transmission lines. They would also look at a facility’s ability to store a significant amount of coal on-site. The first challenge will be a political and economic one: selecting which plants get these lucrative contracts. Next, the integration itself is a major hurdle. It involves complex negotiations for these non-market agreements, followed by potential physical upgrades to substations and transmission infrastructure to ensure that power can be delivered reliably from the chosen plant to the base, even if the surrounding commercial grid is down. This isn’t just a paper-signing exercise; it will require significant engineering and investment.
What is your forecast for America’s energy mix and grid security over the next decade if policies continue to prioritize coal for national defense purposes?
If this policy becomes an enduring part of our national security strategy, we’ll likely see a bifurcation in our energy grid’s development. On one hand, the broader civilian market will continue its shift toward natural gas and renewables, driven by economics and environmental policy. On the other hand, you’ll have these protected “islands” of coal-fired power dedicated to military security. This could improve the resilience of specific defense installations, which is the stated goal. However, it may also divert federal investment and focus away from modernizing the entire national grid with more advanced, decentralized, and cyber-secure technologies that could benefit everyone. The risk is that we end up with a few hardened fortresses powered by legacy fuel while the civilian grid, which underpins the entire economy, remains vulnerable. The national security conversation must eventually evolve to include the resilience of the whole system, not just its military components.
