By Terry L. Headley, MBA
President, The Hedley Company — Communications and Research for Energy
Vice President of Communications and Research, Seneca Center for Budget and Policy
Winter Storm Fern struck the United States in mid-January 2026 with ferocious intensity, delivering heavy snow, ice, and sub-zero temperatures from Texas to New England. The storm exposed real vulnerabilities in the nation’s electric grid. At the height of the event, more than 245,000 customers lost power in Tennessee alone, while natural gas prices spiked to $30.565 per MMBtu in parts of the PJM Interconnection.
Yet the grid did not collapse.
Coal plants ramped up dramatically. Generation across the Lower 48 states jumped 31 percent in a single week—from roughly 70 gigawatt-hours per day to approximately 130 gigawatt-hours. During peak demand, coal supplied up to 40 percent of electricity in the Midwest’s MISO region and 24 percent in PJM. That performance was not accidental. It was the result of coal’s inherent strengths as a dispatchable, baseload resource with secure, on-site fuel stockpiles capable of withstanding extreme weather.
Winter Storm Fern served as a clear reminder that America’s energy future cannot afford to abandon coal. Rather than accelerating retirements, the United States should invest strategically in modernizing existing coal plants and advancing clean coal technologies. These investments would strengthen grid resilience, unlock economic opportunity, secure critical supply chains, and preserve national security advantages. Recent federal actions point in this direction, and policymakers should build on that momentum as part of a true all-of-the-above energy strategy.
Trump Investment for Modernization
The U.S. Department of Energy has taken tangible steps to support coal modernization. In 2025, the agency committed $625 million to reinvigorate coal infrastructure, along with up to $525 million for plant upgrades or new capacity to address urgent grid reliability needs. These investments target efficiency improvements, advanced emissions controls, and the integration of carbon capture and storage technologies. CCS demonstration projects have shown the potential to reduce carbon dioxide emissions by 90 percent or more.
Modern supercritical and ultra-supercritical coal plants already achieve thermal efficiencies exceeding 45 percent—far outperforming older units—while significantly reducing emissions of sulfur dioxide, nitrogen oxides, and particulate matter. With modern technology, coal can meet stringent environmental standards without sacrificing reliability.
One of the most promising areas for investment is the transformation of coal ash from a waste product into a strategic resource. The Department of Energy’s National Energy Technology Laboratory has developed patented technologies to extract critical minerals, including rare earth elements, from coal ash and mine waste. These materials are essential for semiconductors, electric vehicle batteries, wind turbine magnets, and defense systems.
China currently dominates global rare earth supply chains, creating serious vulnerabilities for U.S. manufacturing and national security. In response, the Department of Energy announced $355 million in grants in late 2025 to scale domestic extraction and processing from coal byproducts. Pilot projects in Appalachia and the Powder River Basin are already demonstrating that coal ash can yield economically viable concentrations of these materials, turning environmental liabilities into economic assets. These investments can reduce import dependence, create high-quality jobs in rural communities, and generate new revenue streams for utilities and mining regions.
Coal’s value extends well beyond electricity generation. Coal gasification and conversion technologies enable production of chemicals, fuels, and materials critical to agriculture and manufacturing. In October 2025, the Department of Energy issued a major loan guarantee—potentially up to $1.5 billion—for the Wabash Valley Resources project in Indiana. The facility will gasify coal to produce roughly 500,000 metric tons of anhydrous ammonia fertilizer annually, while using advanced carbon capture to achieve near-zero emissions. The project is expected to create 240 permanent jobs and support thousands more during construction, while strengthening food security by relying on domestic coal rather than imported natural gas.
Perhaps coal’s most indispensable role is in steel production. Metallurgical coal is essential for producing coke, which serves as the reducing agent in blast furnaces. In May 2025, the Department of Energy officially designated coal used in steelmaking as a critical material under the Energy Act of 2020. Steel underpins infrastructure, shipbuilding, automotive manufacturing, and military readiness. Without reliable domestic metallurgical coal, the United States risks dependence on foreign suppliers, undermining both industrial competitiveness and national defense.
Globally, coal remains a cornerstone of energy and economic growth. According to the International Energy Agency’s Coal 2025 report, global coal demand reached a record 8.85 billion metric tons in 2025. While demand may plateau in some regions, new mines continue to open in Asia, Australia, and elsewhere to support power generation and industrial growth. China, India, and other emerging economies are expanding coal-fired capacity and steel production at a rapid pace.
Planning for the Future
If the United States continues phasing out domestic coal capacity without adequate replacements, it exports jobs, surrenders market share, and weakens its geopolitical position. Coal still supports tens of thousands of direct and indirect jobs nationwide, particularly in economically distressed regions. Revitalizing the sector through modernization investments would reverse decline and provide stable employment opportunities.
Upgrading existing coal plants is often more cost-effective than replacing them with intermittent renewables backed by large-scale battery storage. Batteries cannot yet provide multi-day backup during extreme weather events like Winter Storm Fern. Coal’s on-site fuel stockpiles provide unmatched resilience against supply disruptions, particularly when gas pipelines freeze and prices spike. Preserving coal capacity helps stabilize electricity prices and shields consumers and businesses from volatility.
Critics often portray coal as outdated and irredeemably polluting. While older plants contributed to environmental concerns, modern technologies have transformed coal’s environmental profile. Advanced emissions controls, CCS pilots, and coal ash reuse have significantly reduced impacts. Abandoning coal prematurely ignores these advancements and increases grid risk. A July 2025 Department of Energy grid reliability report warned of a 100-fold increase in outage probability by 2030 without sufficient dispatchable generation. Rising demand from data centers, electric vehicles, and electrification only intensifies that risk.
The path forward requires rejecting ideological extremes in favor of practical solutions. Policymakers should prioritize funding for coal plant upgrades, critical mineral extraction from coal waste, coal-to-products facilities, and carbon capture deployment. These investments would strengthen the grid, drive economic growth, secure supply chains, and reinforce national security.
Coal is not a relic of the past. With targeted modernization, it remains a reliable and affordable pillar of America’s energy future.
About the Author
Terry L. Headley, MBA is President of The Hedley Company, a communications and research firm focused on energy, infrastructure, and public policy, and Vice President of Communications and Research for the Seneca Center for Budget and Policy. With more than twenty-five years of experience spanning journalism, trade association leadership, and strategic communications, he is widely recognized for his work on electric grid reliability, fuel security, and energy economics.
Often described as a “coal guy,” Headley emphasizes evidence-based analysis and clear, disciplined communication in defense of reliable, domestic energy. He writes and speaks regularly on energy markets, regulation, and national security and is active on LinkedIn at https://www.linkedin.com/in/prdoc1/.
About The Hedley Company
The Hedley Company is a strategic communications and research firm specializing in energy, infrastructure, and economic policy. The firm provides data-driven research, messaging strategy, editorial content, and policy analysis for energy producers, trade associations, policymakers, and advocacy organizations.
With deep expertise in electric generation, fuel markets, grid reliability, and industrial supply chains, The Hedley Company translates complex technical and regulatory issues into clear, credible narratives that inform public debate and decision-making.
About the Seneca Center for Budget and Policy
The Seneca Center for Budget and Policy is a nonpartisan research organization dedicated to advancing sound fiscal policy, energy security, and free-market solutions that support American prosperity. Through rigorous analysis, the Center promotes reliable energy sources that strengthen grid resilience, support job creation, and reinforce national security—emphasizing balanced, affordable, and practical policy approaches.