Coal is not clean, it's not beautiful, and we don't need it for AI

Independent

13-04-2025

This week, US President Donald Trump issued an executive order aiming to revive 'America's beautiful, clean coal industry' such that it can power the rise in electricity demand from, among other things, artificial intelligence. However, this nostalgic push ignores the reality that has been commonly understood since Dickens: nothing about coal is clean.
What it also ignores are reasons behind the industry's twenty-year decline in the US, the incredible uncertainty surrounding what is or might be the future energy demand of AI, and the data centres that give it life. Coal is a dirty business. From the moment you dig it up, often with the help of some of the world's biggest explosive rigs, you release methane gas, which warms the planet over 82 times faster than carbon dioxide over 20 years. Across the Appalachian Mountains in West Virginia and Kentucky, the most popular type of coal mining literally involves blowing the tops of mountains off, covering streams in rock and dirt and filling the nearby valleys in pollutants and heavy metals.
When you then try to burn coal to create electricity, you immediately release carbon dioxide, the main driver of climate change. Burning coal currently releases approximately one-fifth of America's total carbon dioxide emissions, along with a host of other air pollutants known to cause asthma and respiratory diseases. Thanks to the Clean Air Act of 1970, originally signed into law by one of Trump's Republican icons, Richard Nixon, the amount of sulphur emissions from coal-fired power plants has significantly reduced from what it once was. This decrease was due to fall even further following the passing of Obama's Clean Air and Water Acts. But these two have already been on Trump's chopping block, as were important updates to protect coal miners from dust inhalation.
But the other reality of the coal sector is that it has been in decline since 2008, and coal plants now generate only 15 per cent of America's electricity. Back in 2008, the US produced over a billion short tons of coal each year. By 2023, production had halved, and even with support from President Trump during his term, over 10,000 coal mining jobs were lost during his first term. Today, just over 45,000 people work in US coal mining, a number dwarfed by industries like McDonald's, which employs nearly 150,000 people.
But times have changed. Those mines are ageing, productivity is falling, and America's energy landscape has shifted dramatically. Thanks to the shale gas boom, ' natural gas ' (which is just methane) has become the dominant source of US electricity. Meanwhile, the cost of renewables has plummeted, and wind and solar have already overtaken coal in the US power mix — just as they have in Canada, Germany, and the UK.
Up until this week, this terminal decline was expected to continue. Ironically, on the same day as President Trump's Executive Order, the US Energy Information Administration released its Short-Term Energy Outlook, projecting that coal production will fall another 9 per cent by 2026. This, they noted, was due to 'coal's continued competition with natural gas and renewables in the electric power sector.'
However, while coal has faded from the American energy landscape, a whole new set of power demands seems to be waiting on the very near horizon. Artificial intelligence (AI) and Bitcoin mining are already driving an explosion in data centre electricity consumption in the US, and many analysts are predicting that this could be a critical challenge for America's electricity grid in the near future.
One of the biggest challenges is that AI technologies like ChatGPT are estimated to require enormous amounts of computing power to run and train. Early estimates suggested that each AI query might use up to ten times more energy than an average Google search – that's before Gemini took over, at least. If you follow this trend, it makes sense to assume that AI electricity demand could be almost impossible to curtail. In January, President Donald Trump announced his plan for AI dominance, backed by the hopes of more than $US500 billion in investments for an artificial intelligence super-project known as Stargate.
While it's incredibly uncertain if this project ever comes to fruition, according to a report from the International Energy Agency this week, electricity consumption for data centres globally could double in the next 5 years alone. In the US, electricity demand for data centres could surpass that of steel, cement, chemicals, and all other energy-intensive industries by 2030. In fact, on a per capita basis, data centres in the US could consume as much electricity per person as it would take to drive an electric car from Los Angeles to New York and back.
But these early estimates are riddled with incredible amounts of uncertainty, partly because no one really knows how this industry will play out, and especially, what kind of innovation is lurking just around the corner. And innovation is the norm in this space. As Conal Campbell, Senior Policy Lead at Ireland's EirGrid, noted this week, 'between 2015 and 2022, global internet traffic increased by 600 per cent, but energy used by data centres grew by less than 70 per cent thanks to technological improvements.'
While America's tech giants aim to pour billions into maximising the AI industry as quickly as possible, competitors from China and India have already highlighted potential step-change improvements in efficiency. Initial testing from China's DeepSeek indicated that simple queries could be solved with between 50 to 75 per cent less energy than those needed for ChatGPT's solutions, using more advanced and energy-intensive GPUs.
To meet this growing energy demand, many tech companies are sounding the electricity demand alarm, crying out for the need to develop new nuclear reactors and now, it seems, even coal-fired power. Microsoft has already teamed up with Constellation Energy to restart a Nuclear reactor at the Three Mile Island nuclear plant in Pennsylvania, and certainly, other companies will make significant investments to secure their own data centre futures. But the line between truth and investor speculation is incredibly hard to see here. Understanding just how world-shifting the AI industry can and will be is one of the most critical questions of our age, and the power sector demands of its growth will play a critical role in shaping the next decade of the world's energy transformation.
In some coal-dependent states, coal power may help sure up short-term energy demand growth driven by new data centres, but I can't see how the incredible cost efficiencies of solar and wind can be ignored long-term. Perhaps that's why Trump needed an executive order to bring back the coal sector this week, because the free market and the country's leading energy agency had already signaled its decline.
This week's executive order may act as a double espresso for the industry's short-term future, but I can't see that energy high lasting much longer.