The U.S. hasn’t opened a new coal power plant since 2013. That’s about to change.

This week, the proposed 1.25-gigawatt Terra Energy Center in southeast Alaska announced it has secured an agreement with South Korea’s Hyundai Heavy Industries Power Systems for roughly $1 billion in utility-scale boilers. It’s the first such order for a U.S. coal plant since 2006.

The Terra Energy Center, backed by an additional $500 million investment from Korean private equity firm KOREIT, would be the first new coal plant built in the United States since the Sandy Creek Energy Station came online in Texas in 2013.

Alaska may be an unexpected location for new coal generation, but this development reflects a rapidly changing U.S. energy landscape defined by surging electricity demand and growing concerns about grid reliability. The AI and data center rush are upending markets, apparently even in Alaska. The Terra Energy Center could also be coming alongside a new data center—a proposal that echoes dynamics playing out across the country.

Meeting Surging Demand

The data center buildout is driving a remarkable uptick in electricity demand, adding new stress to the nation’s already overstretched supply of power.

The North American Electric Reliability Corporation’s (NERC) latest long-term reliability assessment found that more than half of the nation faces potential power supply shortfalls within a decade. NERC projects U.S. peak power demand will increase by more than 225 gigawatts in summer and 245 gigawatts in winter by 2035—roughly equivalent to what’s needed to power 150 million homes.

With power demand surging and electricity prices up nearly 40 percent since 2020, renewed interest in coal – whether the construction of new plants or extending the life of existing plants – is the logical result of an urgent market need. In short, coal answers questions alternatives cannot.

Coal remains one of the few sources of reliable, dispatchable power capable of delivering electricity on demand, particularly during periods of peak stress on the grid. And unlike intermittent sources or fuel-constrained alternatives, coal plants can ramp up output when needed backed by months of on-site fuel.

Whether it’s the announcement of additional new coal plants – Wyoming has shown interest – or getting more out of existing plants, expect coal to play a critical role in the decade ahead. Xcel Energy in Colorado is just the latest utility to announce it needs to extend the life of its coal plants to meet an emerging supply shortfall. Along with plant extensions, there’s ample additional evidence that coal’s reemergence to center stage is already underway.

The average capacity factor of the coal fleet increased from 42 percent in 2024 to 50 percent in 2025 as the fleet ramped up generation to meet higher power demand and to take market share from higher priced natural gas. Both of those dynamics remain in place in 2026 with power demand growth only accelerating.  
For an energy source that was all but written off little more than a year ago – the target of a remarkably irresponsible regulatory assault – coal power’s second act as grid savior is something to behold. The newly announced Terra Energy Center could well be a harbinger of more to come.