DOE funds 13 coal plants, new export terminals as grid grants stall
Washington is pouring federal money into coal and minerals security while billions in grid upgrade grants remain frozen or canceled.
The Department of Energy said it will provide up to $500 million in Defense Production Act funding to support 13 US coal-fired power plants and new coal export infrastructure, a package that includes up to $425 million for 12 projects aimed at strengthening the coal fleet and up to $75 million for the West Gateway coal export terminal.2
The decision lands as the same administration is canceling or stalling billions in grid modernization grants. Russ Vought, director of the White House Office of Management and Budget, declared in a social media post that the administration would cancel "nearly $8 billion in Green New Scam funding," and according to an independent tracking of federal spending, of the roughly $11.4 billion in DOE funds obligated to grid infrastructure and resilience — a category that includes GRIP program funds — $9.1 billion remains "at risk," with funding stalled or timelines extended.4
That $9.1 billion at risk compares with $400 million in grants canceled outright and $1.3 billion not yet disbursed but showing no signs of being stalled.4
The contrast is stark. DOE is simultaneously funneling taxpayer money into coal plants and export docks while 223 grid projects tied to states that voted for Kamala Harris in the 2024 election face termination, according to Canary Media reporting.4
The grid money being held up includes a $630.6 million grant awarded in 2024 aimed at upgrading more than 100 miles of high-voltage power lines with advanced cables capable of carrying more electricity along existing transmission corridors.4
One stalled project shows what is at stake. Alliant Energy's Smart Power Automation in Rural Communities (SPARC) project won a $50 million grant in late 2024 to add grid visibility and control devices to 140 grid circuits in disadvantaged and tribal communities.4 Those devices could allow the utility to quickly find and isolate faults on its grid, cutting power outages in targeted communities by up to 50%.4
The coal funding is not the only federal push into traditional assets. The Energy Dominance Financing (EDF) Program has been handing out record loans. American Electric Power's Texas subsidiary reached financial close on a loan of up to $3.26 billion, which DOE and AEP claimed will help unlock $685 million in electricity cost savings over the next 30 years for more than one million households and businesses in the state.3
Earlier in 2026, Southern Co's Alabama Power and Georgia Power secured a total of up to $26.54 billion in EDF loans. The 30-year loans — around $22.42 billion for Georgia and around $4.09 billion for Alabama — could result in $7 billion in savings for 4.3 million customers, according to Southern.3
The AEP loan guarantees will help "upgrade nearly 5,000 miles of transmission lines in Indiana, Michigan, Ohio, Oklahoma, and West Virginia while saving customers an estimated $275 million in financing costs over the life of the loan," the company said.3
The pattern points to a clear shift in federal priorities. Coal gets Defense Production Act money and new export infrastructure. Transmission gets loans that must be repaid with interest. Grants that do not carry a repayment obligation are being canceled, stalled, or terminated, often with political considerations attached.4,2
The minerals side of the supply chain is moving in the opposite direction from coal. Investment in critical minerals fell 9% last year, the first substantial drop since 2020, as miners cut spending on lithium, nickel and cobalt after several years of rapid growth.1
That investment drought comes as the administration talks up mineral security but has delivered mixed signals. The Trump administration has committed billions to minerals that power EVs, according to OilPrice reporting, but the sector's investment base is contracting even while Washington frames minerals as a strategic priority.5,1
The practical question for power markets is whether the coal money and the EDF loans can compensate for the stalled grid work. AEP's EDF loan covers transmission upgrades in five states, and the company says the package includes 5 GW of new gas generation, 6 GW in nuclear improved through uprates and license renewals, hydropower modernization, battery energy storage systems and over 1,300 miles of transmission.3
What to watch is how the $9.1 billion in stalled grid funds interacts with the EDF loan pipeline. If the Trump administration keeps approving repayable loans while killing grants, the cost of grid upgrades shifts from taxpayers to ratepayers, and the projects most likely to proceed are those backed by utilities with balance sheets large enough to absorb the debt burden.4,3
Whether the coal plant money moves beyond announcements into actual construction and export volumes will be the next test. The DPA funds are authorized, but the 13 plants and the West Gateway terminal still face permitting and financing hurdles, and the minerals investment contraction suggests the supply chain rebuild Washington keeps promising is not yet translating into private capital.2,1