The Department of the Interior said it aims to open up 13.1 million acres of federal land to coal leasing, making good on President Donald Trump's orders to increase coal production despite a broader global call to curb carbon emissions.
The Interior Department head Doug Burgum billed the move as a means of "strengthening our economy" and "protecting national security."
The government would also reduce royalty rates charged to companies for extraction of coal, the dirtiest fossil fuel.
"Beautiful, clean coal will be essential to powering America's reindustrialization and winning the AI race," said Chris Wright, the US energy secretary.
The investments would include funds to upgrade coal plants that may otherwise have shut down.
The initiatives immediately drew criticism from environmental advocates.
"This administration is taking federal dollars and handing them over to the owners of the oldest, most expensive and dirtiest source of electricity," Amanda Levin, policy analysis director at the National Resources Defense Council, in a statement to AFP. "What a waste of our hard-earned tax dollars."
Coal use in the United States has steadily dropped in recent decades, as natural gas as well as renewables like wind and solar power grab greater market shares -- not least due to cost.
In 2024 solar and wind energy combined surpassed coal for the first time, according to an analysis from the independent research organization the Rhodium Group.
Some 15 percent of US electricity came from coal-burning plants in 2023, a significant drop from 50 percent in 2000, Energy Information Administration data showed.
Trump last week spent a good chunk of his address to the United Nations praising "clean, beautiful coal" and declaring climate change a "con job."
The use of coal in China and India is still surging, which the Trump administration has cited as reason to reinvest in the industry.
Coal accounts for just over a third of global electricity production and phasing it out is fundamental to meeting climate change goals.
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