President Donald Trump is desperate to put coal back on the map by building the nation’s first coal-fired power plant in more than a decade in Alaska.
The problem is that the planned mine needed to power the planned 1.25 gigawatt Terra Energy Center doesn’t yet exist. Additionally, the project’s fate hinges on uncertain AI construction and shifting political winds, and it faces growing concerns about the impact of development on the state’s pristine Susitna Valley.
“This is a victory for the U.S. coal industry as this is the first new coal-fired power plant in more than a decade,” said Andy Blumenfeld, an analyst who tracks the coal market at consulting firm McCloskey by OPIS. “But it depends a lot on politics and it could be temporary.”
President Trump is pushing aggressive AI and fossil fuel policies after failing to revive the coal sector during his first term in the White House. He ordered the Pentagon to source electricity from coal-fired power plants, spend millions of dollars to upgrade plants on the brink of closure, and keep aging facilities in states like Michigan and Colorado open. Experts are still waiting for evidence of a long-term resurgence.
Now, the administration is touting it as potentially the first new coal-fired power plant built in the United States since 2013.
Trump administration officials announced this week that Terra Energy Centers, an affiliate of Canada-based Flatlands Energy Corp., has reached a $1 billion “in principle” agreement with South Korea’s Hyundai Heavy Industries Power Systems for boilers for large coal-fired power plants. This is the first time such a boiler has been ordered in the United States since 2006, according to the Interior Department.
KOREIT, one of South Korea’s largest infrastructure private equity firms, also pledged $500 million in equity investment in coal-fired power plants, the agency said.
But the project won’t do much to shake up coal’s fortunes. About 40% of U.S. coal-fired power plants have closed in the past decade, according to U.S. Energy Information Administration statistics. Terra plans also face an uncertain future in Alaska’s Matanuska-Susitna Borough north of Anchorage.
Earlier this month, Alaska Mayor Edna DeVries, who is running as a Republican to become the state’s next governor, vetoed a resolution asking her colleagues to work with Terra to pitch a company that could build a coal-fired power plant near Skwentna for data centers and other energy-intensive projects. DeVries argued the project needed more careful scrutiny. A few days later, Congress voted 6-1 to override the veto.
“The data center is just a potential concept that could help capture some of that energy and lower energy costs for Mattos residents,” Councilman Michael Bowles told Alaska Public Media at the time. “Two weeks ago I was uneducated, and now I am.”
Mr. Blumenfeld, along with Mr. McCloskey, said a “huge” coal-fired power plant is being planned in Anchorage as the state runs out of natural gas and looks for alternatives in coal-rich areas. He said Terra originally pitched the 400MW plant to provide long-term power to the Anchorage area and possibly the Donlin gold mine.
Terra and Flatlands executives did not respond to multiple requests for comment.
Terra’s current plant appears to include a wellhead plant powered by coal (lignite to subbituminous coal) from reserves in the area that Mobil Oil previously explored in the 1970s, Blumenfeld said. He noted that Flatlands has been drilling exploration holes throughout the region over the past eight years.
What’s not clear is how the company will pay for the coal-fired power plant, overcome the region’s infrastructure deficit, or whether carbon capture and sequestration is still being considered.
“This region has a lot of coal, but it’s not developed because of its remoteness,” Blumenfeld said. “There is no infrastructure (no roads, railways, electricity, ports, limited labor), environmental sensitivities, and coal has an overall low calorific value.”
“It’s all ambitious.”
Coal advocates across the country were quick to praise the potential of new coal-fired power plants in the United States
“The United States has not brought on line a new coal-fired power plant since 2013, and that is about to change,” the National Mining Association wrote in an online post Wednesday. “The rush for AI and data centers appears to be transforming the market in Alaska as well.”
Closer to home, some have questions about developers, financing and planning, and worry about the impact coal mining and burning will have on the pristine nature of Alaska’s Susitna Valley.
“Right now we don’t have a mine, we don’t have a power plant, we don’t have a data center. It’s all aspirational,” said Merris Cody, who heads the Susitna River Coalition. “Essentially, they’re trying to turn this wasteland into an industrial zone.”
Cody’s coalition has repeatedly raised questions about the financing of coal-fired power plants.
As it stands, Terra is an affiliate of Flatlands Energy, listed as Alaska Asia Clean Energy Corp. in state filings. In addition to the new funding, Nova Minerals, an Australian mining company with assets in Alaska, has previously invested nearly $1 million in Alaska Asia Clean Energy, according to a 2023 report. Nova declined to comment.
Last year, Terra proposed a small 400-megawatt coal project with carbon capture and storage that would have involved transporting carbon through a 60-mile pipeline and permanently injecting it underground in Beluga’s depleted natural gas fields, according to the Susitna River Coalition.
But Cody of the Susitna River Alliance questioned why the company was so intent on building a mine and plant in a pristine valley known for its spectacular views along the Susitna River, fed by glaciers, and far from infrastructure.
American Rivers last year named the Susitna River the eighth most endangered river in the nation due to the threat of a 160-mile industrial road called the West Susitna Access Road that the state is building. The road would cross more than 180 rivers and threaten salmon habitat.
The same road is critical to the construction of Nova’s Ester Gold and Significant Minerals project, which received $43 million from the Department of Defense last year.
Erin McKittrick, an independent energy analyst based in Alaska, agreed, saying the Terra Energy Center project doesn’t appear to have a power purchase agreement in place, making it almost pointless to rely on a coal mine or power plant without a data center.
“It makes no sense that they ordered a boiler in a forested area 110 miles from the power lines,” she says. “This company is basically a coal lease and some PowerPoint slide decks.”
Documents filed with the borough last year say the Matanuska Power Association is “working closely with Terra Energy” on the non-binding terms and conditions of the power purchase agreement and that “a non-disclosure agreement is in place.” The power company did not respond to requests for comment.
Terra plans to boost business in the area with support from local authorities. According to the borough’s resolution, the company is preparing to launch an “international marketing campaign to promote Alaska, and specifically the borough, as a desirable destination for major investments and the development of industrial and large-scale facilities.”
But Alex Petkanas, political director for the Alaska Center, countered that coal and data centers are having a “devastating public health impact” in other states. “This project is the wrong direction for Alaska to take at a critical juncture in its energy landscape,” Petkanas said. “Instead, we should invest in proven renewable technologies like wind and solar that can offset long-term costs for Alaskans.”
