As Trump brings back coal to power AI, China moves on to clothe the world with it

US President Donald Trump is pushing to resurrect America’s coal sector by expanding mining and subsidising coal-fired power plants to meet the energy demands in a race against China on artificial intelligence.\n“Our nation’s beautiful clean coal resources will be critical to meeting the rise in electricity demand due to the resurgence of domestic manufacturing and the construction of artificial intelligence data processing centres,” Trump said in an executive order signed on April 8.\nBut China has upped its game. In Pingdingshan, a once-struggling coal city in Henan province, coal is no longer just mined and burned – it’s being chemically transformed into nylon, one of the most important and widely used synthetic polymers in the world.\nNylon plays an essential role in high-performance clothing such as lingerie and sportswear. It also has a wide range of high-value applications in aerospace, defence, automotive and electronic industries.\nThis shift marks a strategic divergence in how nations are treating fossil resources in the age of the green energy revolution.\nWhere the US doubles down on coal as an energy commodity – despite pollution and climate impact, China is unlocking its potential as a critical raw material that adds far more value to the manufacturing production chain than in a boiler.\nAnd Pingdingshan, now a “nylon centre of the world”, has pulled this off in less than a decade.\nAccording to the state-owned Science and Technology Daily, Pingdingshan rose from industrial decline to become the global centre of the material by establishing the world’s most comprehensive coal-based nylon chemical industry chain, following an ambitious industrial transformation plan launched in 2016.\n\n\nCoal-based nylon refers to the process of manufacturing polyamide products through chemical conversion using coal as a primary feedstock. These products range from high-strength fibres to advanced engineering plastics and others.\nAt a recent industrial development conference held locally, Pingdingshan unveiled five major innovative nylon-derivative materials, with several technologies reportedly breaking international monopolies and securing a national leading position.\nAccording to an article from the local official newspaper last month detailing the city’s economic revitalisation, Pingdingshan’s 2016 development blueprint made it clear the city would cultivate two major industrial clusters: nylon chemical fibres and textiles, and engineering plastics.\nIt would also develop associated industries, such as polyurethane (PU) and polycarbonate (PC), two widely used materials. To champion this ambition, the city has doubled down on innovation and industrial support facilities.\nIn 2024, R&D expenditure in the city’s nylon new materials development zone reached 1.281 billion yuan (US$182.2 million), accounting for nearly 5 per cent of its operating revenue – significantly exceeding the provincial average. This investment has propelled multiple disruptive technologies and the industrialisation of key nylon raw materials.\nMeanwhile, the city has implemented various measures to consistently drive down the cost of water, electricity, gas and capital, easing the financial burden on industrial enterprises using these resources.\nFor example, the municipal authorities coordinated water resources across the entire region, increased the use of reclaimed water and constructed large-scale water plants for industrial use. These efforts reduced the price of industrial water to 2 yuan (US$0.28) per tonne, the lowest in the province.\nTo further reduce logistics costs for exporting goods, the local port was opened on November 5. Bulk goods can now be exported to Southeast Asia and other regions via waterways at lower freight rates.\nPingdingshan, once among China’s 10 major coal production bases, faced the predicament common to all resource-dependent cities: heavy pollution, a reliance on a single industry and the daunting challenges of transformation.\n\nStatistics from the first quarter of 2015 revealed a sharp slowdown in industrial growth as traditional pillar industries – coal, power generation and chemicals – saw growth rates plummet. During that period, profits in the coal mining and coking industries fell by around 48 and 59 per cent respectively, with 17 per cent of large industrial enterprises recording losses.\nToday, after roughly a decade of economic restructuring, Pingdingshan’s regional GDP has grown significantly. In the first quarter of this year, industrial value added (IVA) increased by 11 per cent year on year and the value added by traditional pillar industries rose by 10.8 per cent compared with last year.\nAccording to local official media, the city has now established a holistic industrial chain encompassing a variety of processes and products, from the processing of coal and coke to the production of nylon polymers, spinning, weaving, printing and dyeing. Three major industrial clusters have been fostered.\nThe “world nylon centre” is now home to over 200 enterprises and projects, with a total production capacity surpassing 4 million tonnes. By 2035, Pingdingshan aims to become the world’s largest, most comprehensive and most competitive industrial base for new nylon materials, according to the government’s plan.\nOther Chinese coal towns may want to replicate Pingdingshan’s success. Hegang, another traditional coal city in China’s far northeast, for example, continues to struggle with resource depletion, industrial decline and population outflow. In 2024, Hegang saw its industrial output value from major enterprises fall by 24.4 per cent year on year.\nPresident Trump has made reviving the flagging coal sector a priority of his second term, aiming to sustain the economies and employment rates of traditional energy cities while meeting the surging electricity demand driven by the proliferation of artificial intelligence data centres.\nHowever, the approach remains largely traditional – focusing on greenlighting more coal mining and subsidising coal-fired power plants.\nIn late September, Washington announced its decision to open 13.1 million acres (5.3 million hectares) of public land to coal mining, while also allocating US$625 million in funding to coal-fired power plants.\nThe Rosebud Mine in Montana, for example, was initially expected to cease operations in October, but the current administration has extended its lifespan until 2039.\n