Trump’s Order Bolstering Coal Looks a Lot Like a Kentucky Law

President Donald Trump’s decision to invoke little-used emergency powers to bolster the American coal industry left energy analysts alarmed and uncertain about what would happen next.

Kent Chandler, the former chair of the public service commission in Kentucky and now a fellow at the center-right R Street Institute, found himself having flashbacks.

Many phrases and concepts in the executive order almost exactly mirror those in a law passed in Kentucky in 2023 — which the coal industry lobbied for — that uses the declaration of an emergency to make it difficult for coal plants to retire. That law employs similar language of reserve margins, discussion of fuel source and mix and other technical specifics in Trump’s Tuesday executive order, which invokes the emergency powers section of the 1935 Federal Power Act, called section 202.

“This is effectively a section 202 nationwide version of the legislation that they passed in Kentucky,” Chandler said. “I would be very surprised if the folks in the administration that had conversations with the industry about what to do on this front weren’t aware of this legislation…”

The Kentucky law has already slowed the retirement of coal plants. During Chandler’s tenure, the commission, in accordance with the new law, ordered that two coal plants scheduled to retire would instead remain in use. “It was significant,” Chandler said…

Now that Trump has essentially nationalized the policy, Devin Hartman, the director of energy and environmental policy at the R Street Institute, said he’s been fielding conversations all day with industry insiders who share the same alarm.

“As a matter of governance, it’s bad. There’s just no way to slice and dice it. There is no evidence of a grid emergency,” Hartman said of the order. “It sets a really bad precedent for future administrations. It creates a lot of opportunity for political side-agendas to undermine evidence-based industry practices…”

In the worst case scenario, a methodology that seriously diverges from the industry standards could also send confusing signals into the market about whether companies should be investing in new power generation in the first place. That’s the last thing that the grid needs, with electricity demand forecast to grow for the first time in decades and new power generation already coming online slower than forecast, Hartman said.