Tyson Slocum knew the Trump administration had an aggressive plan to bail out dirty, expensive coal plants. He was just waiting for it to put the idea in writing.
His wait is over. President Donald Trump signed several executive orders on Tuesday to boost the moribund U.S. coal industry. Among those directives, one stands out for its potential to radically reshape how the U.S. regulates power plants: an executive order titled “Strengthening the Reliability and Security of the United States Electric Grid.”
The order instructs Energy Secretary Chris Wright, a former gas industry executive who denies that climate change is a crisis, to give the Department of Energy sole control over key grid-reliability decisions currently made by independent agencies. The Energy Department would be empowered to keep unprofitable and polluting coal plants open in the name of reliability — and stick utilities, customers, and communities with the hefty financial and health costs.
Slocum, director of the energy program at nonprofit watchdog group Public Citizen, says the executive order closely follows a plan leaked during the first Trump administration to use federal emergency powers to override state, regional, and federal authorities that now govern reliability across the U.S. electricity sector. Administration officials disavowed that approach when it came to light in 2018.
Still, in a blog post published two days after the November 2024 election, Slocum predicted the Trump administration would revive this strategy, which he described in a Tuesday interview as “the Department of Energy muscling in on reliability in ways that can be abused.”
Trump’s other Tuesday executive orders aim to lift restrictions on coal mining, fast-track coal leases on federal lands, and free coal plants from air-pollution regulations. But among those actions, the executive order focused on reliability may be the surest way to protect the industry from the economic realities that have pushed it into decline.
Coal, the most polluting and carbon-intensive source of electricity, has fallen from nearly half the country’s generating capacity in 2011 to just 15% last year. Cheaper fossil gas and even cheaper clean energy and batteries have decimated its economics. Over 120 U.S. coal plants are slated to shutter over the next five years.
“The only way to revive coal is to do two things,” Slocum said. “One is to force ratepayers to pay for it. That means electricity’s going to get more expensive to bail out what’s probably, at this point, one of the most expensive forms of energy out there. The other thing they need to do is pollute clean water, foul the air, and contribute to the climate crisis — because that’s what coal plants do.”
The reliability regime that Trump’s executive order would disrupt
States regulate utilities and thus have primary authority over the nation’s electricity generation. Even within competitive energy markets, where many power plants are owned and operated by companies that aren’t regulated utilities, states retain significant say over which plants are built, kept open, or closed down.
But the federal government also has significant powers, as laid out in the 1935 Federal Power Act. Those include regulating the bulk power system — the network of high-voltage transmission lines crossing state borders and the power plants, solar and wind farms, battery banks, and other resources that keep those grids humming.
Two entities are primarily responsible for grid reliability under current law: the Federal Energy Regulatory Commission, an agency with commissioners appointed by the president but traditionally independent from political interference, and the North American Electric Reliability Corp., a nonprofit regulatory authority that includes utilities and grid operators in the U.S. and Canada.
FERC and NERC commonly issue recommendations or mandates on grid reliability. NERC warned last year that much of the country faces looming reliability challenges due to power plant closures, bottlenecks in interconnecting new generation, lack of investments in expanding transmission grids, and expectations of rapid growth in electricity use. Republican lawmakers and a number of utilities have cited these conditions to call for keeping coal plants open past planned closure dates.
The mechanisms by which the federal government ensures the reliability of the grid are set out in Section 215 of the Federal Power Act, said Sanjay Narayan, a managing attorney at Sierra Club’s environmental law program. Over the decades, he said, FERC, NERC, regional grid operators, and state-regulated utilities have established “elaborate regulatory processes that ensure there are adequate reserve margins.” Reserve margins are the generation capacity needed to maintain grid reliability during peaks in power demand, major grid failures, extreme weather events, and other emergencies.
But another section of the Federal Power Act — Section 202(c) — gives the federal government some extraordinary powers. It allows the energy secretary to order certain power plants to keep running during emergencies, and to waive federal and state environmental rules to allow them to do so without threat of lawsuit or regulatory punishment.
Those orders are almost always temporary, lasting a few hours to a few days, and reserved for “when unexpected events, mostly weather-related, threaten short-term outages,” Narayan said.
In a few instances, DOE has ordered a power plant to stay open until new power lines can be built to prevent grid-reliability threats, he said. Utilities and grid operators have similar authority, which they have used to keep plants running for years past their planned retirement dates.
But Section 202(c) authority has never been used “to force ratepayers to subsidize politically favored parties who can’t compete in the market,” Narayan said. “And nothing about long-term reserve margins fits within the statutory or common understanding of an emergency, which is what Section 202 is meant to address.”
Giving DOE total control over which power plants stay or go
Tuesday’s “reliability and security” executive order seeks to extend those emergency powers indefinitely, Slocum said. It gives DOE sole jurisdiction to determine whether any power plant in the country can close or whether it must stay open until DOE says it isn’t needed anymore.
First, the executive order tasks DOE with creating a “uniform methodology” for analyzing “current and anticipated reserve margins” for all transmission grids regulated by FERC. Then it orders DOE to identify regions where reserve margins are or could be “below acceptable thresholds” — essentially, telling DOE to recreate the reliability risk-assessment work that FERC, NERC, regional grid operators, and state regulators and utilities already do, but with no outside input or oversight.
Finally, it orders DOE to establish a “protocol to identify which generation resources within a region are critical to system reliability,” and use “all mechanisms available under applicable law, including section 202(c) of the Federal Power Act,” to prevent any “critical” generator larger than 50 megawatts “from leaving the bulk-power system” — or changing the type of fuel it uses — if that would violate DOE’s reserve margin methodology.
In simple terms, instead of FERC, NERC, grid operators, utilities, state regulators, and policymakers working together under their established spheres of authority to independently study and manage grid-reliability needs, the energy secretary would “unilaterally set his own reserve margins,” Slocum said.
Then, “if things fall below his arbitrarily set reserve margin, he can declare a Section 202 emergency” to prevent power plant closures in the relevant grid region, he said. Because power plant owners must be compensated for operating those facilities, this equates to forcing utilities or energy markets to pay them to stay open, whether or not their electricity is cost-competitive.
The executive order outlines no role for any other federal agency or other stakeholder in this new process.
“The Secretary of Energy can set whatever reserve he wants,” Slocum said. “It’s not in consultation with [grid operators], or FERC, or NERC. It’s a unilateral, arbitrary standard.”
