Overview
On Tuesday, April 8, 2025, the Trump Administration (the Administration) issued three executive orders (EOs) and a Proclamation aimed at revitalizing the US coal industry, bolstering energy grid reliability, and curbing perceived overreach by states in regulating energy production. This summary of the three EOs and Proclamation focuses on those portions of the orders that will impact FERC-regulated public utilities and pipelines from a commercial and regulatory perspective.
Protecting American Energy from State Overreach (Executive Order)
Under the State Overreach EO, the Attorney General must review state and local actions of all types that impose additional compliance burdens on interstate energy infrastructure or are deemed unconstitutional because they are preempted by federal law. The Attorney General is specifically asked to prioritize identifying state laws addressing climate change, ESG initiatives, environmental justice, carbon or greenhouse gas emissions, and carbon penalties or taxes.
The State Overreach EO provides examples of such state laws and policies, including retroactive fines or penalties on fossil fuel producers, carbon-focused lawsuits, restrictions on interstate energy commerce, delays in project permits, and policies affecting siting, electric generation, and interstate energy trade. The order argues that these state actions may unduly discriminate against out-of-state businesses, violate the principle of state equality, and impose arbitrary and excessive fines without legitimate justification.
Most relevant to energy companies, the State Overreach EO, is an effort to assert federal control over current and future energy development and usage, including the sources of electric generation and the use of natural gas. The Administration is ready to litigate against what it views as unconstitutional state interference with its preferred fuels. The extent of the types of laws and regulations the Administration plans to challenge, however, remains unclear due to the nature of the examples provided; for example, there is no mention of renewable portfolio standards, right of first refusal laws, or other state regulatory programs that subsidize renewable resources. Rather, the focus is on laws that financially punish users or producers of fossil fuel, including retroactive production. The EO is likely to result in litigation over many forms of state climate policies and signals. Also importantly, the EO signals that DOJ will continue to oppose transmission right of first refusal laws.
Strengthening the Reliability and Security of the United States Electric Grid (Executive Order)
The Strengthening the Grid EO addresses the electricity demand surge driven by technological advancements such as AI data centers and increased domestic manufacturing, compounded by existing capacity challenges. It mandates the strengthening of the reliability and security of the US electric grid by utilizing all available power generation resources, especially those with secure and redundant fuel supplies.
To ensure energy reliability and security, the DOE Secretary is instructed to streamline and expedite the DOE’s processes for issuing orders under section 202(c) of the Federal Power Act during periods when the relevant grid operator forecasts a temporary interruption of electricity supply is necessary to prevent a complete grid failure. This authority under the EO includes the power to review and approve applications from generators seeking to operate at maximum capacity.
Additionally, the DOE Secretary has 30 days to develop a uniform methodology for analyzing current and anticipated reserve margins across all FERC-jurisdictional regions (presumably on a balancing authority area (BAA) basis, as is done currently). This methodology must identify current and anticipated regions with reserve margins below acceptable thresholds. The approach used will consider real-time performance data of specific generation resource types under various grid conditions, as well as historical performance data. The methodology must be capable of "accrediting" generation resources based on various grid scenarios. Within 90 days (i.e., 60 days after establishing the methodology), the DOE website must publish both the methodology and any analysis it produces. This task appears to be monumental in scope given that there are many thousands of generating resources to "accredit," and there is no indication whether existing (and varied) methods used by ISOs/RTOs and other BAAs to accredit resources for capacity purposes will be used.
After the DOE crafts and produces an analysis, the DOE must assess the analysis on a regular basis and develop a protocol to identify which generation resources within a region are critical to system reliability. This "critical generation protocol" must include mechanisms available under applicable law, including FPA section 202(c), to ensure any critical generation identified within an at-risk region is appropriately retained (i.e., cannot be retired). Also, as the DOE Secretary deems appropriate and lawful, the Secretary may prevent critical generation resources above 50 MW from being removed from the bulk power system or from undertaking a fuel conversion, if the conversion would reduce accredited generating capacity.
This Strengthening the Grid EO could have major ramifications for planned generation retirements and mothballed generation. It likely will lead to a major debate about how to accredit intermittent resources and particularly those paired with storage; because there is a question of whether storage can be accredited, given the use of the term "generation."
Reinvigorating America’s Beautiful Clean Coal Industry and Amending Executive Order 14241 (Executive Order)
The Administration has emphasized coal’s importance in national and economic security, highlighting its crucial role in meeting the growing electricity demand from AI data centers and domestic manufacturing. The Reinvigorating Coal EO designates coal as a mineral under EO 14241, granting it expedited permitting and development treatment. Reinvigorating Coal EO also directs the DOE and the Department of the Interior (DOI) to evaluate coal used in steel production as a "critical material" and "critical mineral" under the Energy Act of 2020. Following this directive, the DOE has already classified steelmaking coal as a critical material and mineral.
The Reinvigorating Coal EO mandates a report on coal resources on federal lands, identifying obstacles to mining and proposing solutions as well as prioritizing and expediting coal leasing and related activities on public lands, including streamlining environmental review processes. The EO terminates the existing moratorium on federal coal leasing. Executive departments and agencies must review and rescind internal regulations, policies, or guidance that may have previously discouraged coal generation or investment in coal infrastructure. This action in turn could affect how federal loans, grants, and investment programs evaluate generation technologies, and have impacts on utilities that own coal plants.
Relevant departments and agencies will coordinate efforts to enhance US coal and coal technology export opportunities and facilitate international offtake agreements for US coal. Agencies are also tasked with identifying and adopting categorical exclusions under the National Environmental Policy Act to boost coal production and export.
Also of relevance to utilities, in response to the energy demands from AI-driven data centers, the Reinvigorating Coal EO instructs the DOI, DOE, and the Department of Commerce (DOC) to assess and identify regions suitable for coal-powered infrastructure to support AI data centers. DOE already has identified 16 federally-owned sites. They must also assess the potential for expanding coal-based infrastructure to power data centers to meet the electricity needs of AI and high-performance computing operations and submit a consolidated summary report with their findings and proposals to the Chair of the NEDC, the Assistant to the President for Science and Technology and the Special Advisor for AI and Crypto.
Already, questions have arisen how such report might take into account state generation siting authority or the more important fact that coal is currently an uneconomic means of producing electricity. Additionally, there are questions about how use of coal-powered generation may align with positions that data center customers have taken in the past on use of such generation.
Regulatory Relief For Certain Stationary Sources To Promote American Energy (Proclamation)
The Proclamation delays by two years the effective date of the application of the National Emissions Standards for Hazardous Air Pollutants: Coal- and Oil-Fired Electric Utility Steam Generating Units Review of the Residual Risk and Technology Review (Amended MATS Rule) for stationary sources listed in an Annex. The Annex does not appear to have been made publicly available.
