Trump announces $700m coal investment using wartime powers

An important development from the financial markets: Trump announces $700m coal investment using wartime powers28 minutes ago Share Save Add as preferred on GoogleArchie MitchellBusiness reporterGetty ImagesDonald Trump plans to invest hundreds of millions of dollars to revive the US coal industry, with much of the new funding coming through the president's wartime powers. "So today we're taking historic action to bring down the price of energy and the cost of living for all Americans with the power of clean, beautiful coal," Trump said at the White House on Thursday. The investment comes as Trump seeks to insulate Americans from rising energy costs following the war with Iran.

To finance the initiative, he invoked the Defense Production Act, a Cold War-era law that grants the president broad authority to support industries considered vital to national security. "As a result of the $700m investment that I'm announcing today, we will protect 14 coal plants and 42 coalmines, a tremendous number, and build two new coal plants and one massive new export terminal," Trump said. The president said $500m (£372m) of federal funds will go towards saving 14 existing coal plants and opening a new export terminal in California.

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The Department of Energy will grant a further $200m to build new coal plants in Alaska and West Virginia, the first new plants in the US since 2013. Trump said that the construction of a coal export terminal in Oakland, California will create more than 1,400 jobs, with the total package supporting around 14,000. The coal plants getting Trump's investment are in Kentucky, North Carolina, Indiana, Tennessee, Arkansas, Arizona, Oklahoma, North Dakota, Wisconsin and West Virginia.

The president argued that successful countries rely on coal before criticising what he called "failure countries" for investing in renewable energy sources such as wind power. Trump said his coal investment plans would save American consumers $50bn in new energy generation costs which otherwise would have been passed on in higher bills. The war with Iran and the closure of the Strait of Hormuz, a critical shipping route that carries around a fifth of global oil and gas supplies, have pushed energy prices higher, driving up costs for consumers.

The average price of a gallon of petrol in the US stood at $4. 24 on Thursday, according to the AAA motoring group. 98 on the day the US and Israel began striking Iran.

According to the Bureau of Labor Statistics (BLS), overall energy prices for consumers rose by 17. 9% in the year to April.

Financial markets are tracking the development closely as investors assess the likely impact.