Donald Trump’s administration is considering invoking sweeping wartime powers to pump up coal and nuclear power plants that are losing out against competitors in the natural gas industry.
Per Ars Technica, the White House is considering two ways to boost the coal industry after being thwarted several times at end-runs around the regulatory process. The first is by directing the Department of Energy to invoke Section 202(c) of the Federal Power Act, which would allow the Trump administration to order coal and nuclear generators to remain online with guaranteed profits despite their financial issues—something essentially akin to an emergency bailout. Ars writes that from 2008 to 2017, this authority was never invoked, and in 2017 it was used just twice: “once to keep a generator open temporarily while another came online, and once to permit limited use of two coal-fired units in Virginia during periods of high demand.”
The second avenue being explored is a little more dramatic: According to Bloomberg, the president could invoke wartime powers under the Korean War-era Defense Production Act.
This route is more akin to nationalization and would classify energy as a “strategic and critical material”; the administration would claim sweeping powers to promote coal and nuclear plants, “including by ordering businesses to accept contracts for materials and services.” The last time the law was applied to power plants was in 2001, when it was used to ensure natural gas plants in California would not go offline and create blackouts, Bloomberg added:
The law allows the president to allocate and prioritize contracts for materials, equipment and services. It also empowers the president to provide incentives to modernize and expand the production capacity of critical resources such as energy — including buying equipment for private companies to use.
The Defense Department, for example, bought semiconductor manufacturing equipment so companies could churn out radiation-hardened microelectronics used by the military — such a niche market that businesses might not have made the investment on their own.
“This would extend the statute far beyond how it’s ever been used before,” Harvard University Electricity Law Initiative director Ari Peskoe told Bloomberg. “This statute did not contemplate the sort of use that apparently now the administration is considering.”
Boosters of this approach include Democratic Sen. Joe Manchin, who represents the heart of coal country in West Virginia, as well as top Trump donors and coal moguls Robert E. Murray and Joseph Craft, Bloomberg added.
Either the 202(c) route or the wartime powers claim could fairly be called long shots, and come after multiple failed attempts by the administration to force electrical grid managers to rely more on coal generators. Per Ars, the DOE is generally reluctant to “use emergency powers” such as 202(c) “to solve an economic situation,” though Secretary of Energy Rick Perry has hinted he may claim that not enough coal and nuclear plants constitutes a national security issue.
The wartime powers claim is broadly written but also predicated on the administration having to claim a specific national security emergency such as an ongoing war or a major disaster, Bloomberg noted, so it’s not clear that it would pass muster either.