The First US Coal Plant in a Decade is on Shaky Ground

 

 

March 21, 2026 - President Donald Trump is gunning to put coal back on the map with the nation’s first coal-fired power plant in more than a decade in Alaska.

Problem is, a planned mine needed to feed the proposed 1.25-gigawatt Terra Energy Center doesn’t yet exist. What’s more, the fate of the project hinges on an uncertain AI build-out and shifting political winds, and is facing mounting concerns about the effect of development in the state’s pristine Susitna Valley.

“For the U.S. coal industry, the win is this will be the first new coal plant in over a decade,” said Andy Blumenfeld, an analyst who tracks coal markets at the consulting company McCloskey by OPIS. “But it depends a lot on politics and that can be fleeting.”

Trump is pushing an aggressive AI and fossil fuel agenda after failing to revive the coal sector during his first stint in the White House. He’s ordered the Pentagon to procure power from coal plants, doled out millions of dollars to upgrade plants on the brink of closure, and directed aging units in states like Michigan and Colorado to keep running. Experts are still waiting for proof of a long-term comeback.

Now, the administration is trumpeting what could be the first new coal-fired power plant built in the U.S. since 2013.

Trump officials this week announced that the Terra Energy Center, an affiliate of Canada-based Flatlands Energy, reached a $1 billion “agreement in principle” with South Korea’s Hyundai Heavy Industries Power Systems for large-scale coal power plant boilers. It’s the first time those boilers have been ordered in the U.S. since 2006, according to the Interior Department.

KOREIT, one of Korea’s largest infrastructure private equity firms, has also committed $500 million as an equity investment in the coal plant, according to the agency.

But the project likely won’t be enough to swing coal’s fate. Almost 40 percent of the U.S. coal fleet closed over the last decade, according to U.S. Energy Information Administration figures. Terra’s plan also faces an uncertain future in Alaska’s Matanuska-Susitna Borough north of Anchorage.

Earlier this month, Edna DeVries, the borough’s mayor who’s also running as a Republican to be Alaska’s next governor, vetoed a resolution calling on her colleagues to work with Terra to market companies that could build the plant near Skwentna using coal, for a data center or another energy-hungry project. DeVries argued that the project needed to be vetted more carefully. Days later, the assembly voted 6 to 1 to override the veto.

“The data center is just a potential concept to help capture some of the energy and lower the cost of energy for Mat-Su residents,” Assembly member Michael Bowles told Alaska Public Media at the time. “Two weeks ago, I was not educated, and now I am.”

Blumenfeld with McCloskey said the “behemoth” coal-fired power plant is being pitched as Anchorage runs out of natural gas and looks for replacements in the coal-rich region. Terra, he said, originally pitched a 400-MW plant to provide long-term power to the Anchorage region and possibly the Donlin gold mine.

Executives with Terra and Flatlands did not respond to multiple requests for comment.

Terra’s current plant appears to include a mine mouth plant that would be fueled with coal — lignite to subbituminous — from a reserve in an area that Mobil Oil previously explored in the 1970s, said Blumenfeld. Flatlands, he noted, has drilled exploration holes throughout the area over the past eight years.

What’s not clear is how the company will pay for the coal plant, overcome a lack of infrastructure in the area or whether carbon capture and sequestration is still on the table.

“There is a lot of coal in this region but it has not been developed because it is remote,” said Blumenfeld. “There is no infrastructure [no roads, railroads, power, or ports, and labor is limited], [there are] the environmental sensitivities, and the coal has overall low heating values.”

‘All aspirational’

National coal boosters were quick to celebrate the possibility of a new coal plant in the U.S.

“The U.S. hasn’t opened a new coal power plant since 2013. That’s about to change,” the National Mining Association wrote in an online post Wednesday. “The AI and data center rush are upending markets, apparently even in Alaska.”

Closer to home, some have questions about the developers, financing and plans, and worry about the effects coal mining and burning could have on the untouched wilderness of Alaska’s Susitna Valley.

“Right now, there is no mine. There’s no power plant. There’s no data center. It’s all aspirational,” said Melis Coady, who leads the Susitna River Coalition. “Basically, they’re trying to make this wilderness an industrial zone.”

Coady’s coalition has repeatedly raised questions about the funding behind the coal plant.

As it stands, Terra is an affiliate of Flatlands Energy, which is listed as Alaska Asia Clean Energy Corp. in documents filed with the state. In addition to new funding, Nova Minerals, an Australian miner with assets in Alaska, has invested nearly $1 million into Alaska Asia Clean Energy in the past, according to a 2023 report. Nova declined to comment.

Last year, Terra proposed a smaller, 400-MW coal project with carbon capture and storage, which would have involved transporting carbon through a 60-mile pipeline to be injected underground permanently at a depleted natural gas field in Beluga, according to the Susitna River Coalition.

But Coady with the Susitna River Coalition questioned why the company is angling to build a coal mine and plant far from any infrastructure in a pristine valley known for its majestic vistas along the glacier-fed Susitna River.

Last year, American Rivers deemed the Susitna River the eighth most endangered river in the nation due to threats from a 100-mile industrial road dubbed the West Susitna Access Road, which the state is pursuing and would cross more than 180 streams, threatening salmon habitat.

That same road is critical for the build-out of Nova’s Estel Gold and critical mineral project, which received $43 million last year from the Pentagon.

Erin McKittrick, an Alaska-based independent energy analyst, agreed and said Terra Energy Center’s project doesn’t appear to have purchase power agreements in place and that it makes little sense for a data center to rely on a coal mine and power plant that don’t exist.

“That they ordered boilers for their patch of woods 70 miles from transmission lines doesn’t make sense,” she said. “The company basically is a coal lease and some PowerPoint slide decks.”

A document before the borough last year states that the Matanuska Electric Association is “working closely with Terra Energy” on a nonbinding term sheet for a power purchase agreement and a “confidentiality agreement is in place.” The utility did not respond to a request for comment.

Going forward, Terra plans to drum up business in the region with local officials’ help. According to a borough resolution, the company is preparing to launch an “international marketing campaign to market Alaska and specifically the Borough as a desirable destination for significant investment and industrial and large facilities development.”

But Alex Petkanas, political director for The Alaska Center, countered that coal and data centers have had “devastating public health impacts” in other states. “This project is the wrong direction for Alaska to take at a critical juncture in our energy landscape,” said Petkanas. “Instead, we should be investing in proven renewable technology like wind and solar that can offset costs for Alaskans long-term.”