President Donald Trump signed the ‘One, Big Beautiful Bill Act’ into law on July 4th – and it will deliver for the North Dakota Coal Industry. Several beneficial policy changes were implemented in the sweeping legislation that will have a profound effect on the lignite industry. This includes an increase in the number of federal lands designated for new coal lease sales, a decrease of the federal royalty rate for coal, a call to expedite lease applications and environmental reviews by the Secretary of the Interior, and more.
“The passage of the One Big, Beautiful Bill Act is a major milestone for the North Dakota lignite industry,” said Jonthan Fortner, Interim President and CEO of the Lignite Energy Council. “Congress and the President clearly understand our nation’s dire need for more reliable, affordable, baseload electricity – and that commitment is evident in the policies set forth by this new law. Making more federally owned coal tracts accessible for mining, streamlining environmental reviews, reducing federal royalty rates, and leveling the playing field for energy-related tax credits will not only help lower electricity prices for Americans but also ensure the continued availability of dependable, 24/7 power.”
Below is a breakdown of each area the Big, Beautiful Bill covers concerning the North Dakota Coal Industry:
More Federal Lands Open for Coal Leasing
The Big Beautiful Bill Opens Up Additional Lands for Federal Coal Leasing. In North Dakota alone, the Bureau of Land Management owns 4.1 million acres of mineral estate.
- Under Sec. 5202 of OBBBA, at least 4 million additional acres on federal lands located in the 48 contiguous states and Alaska will be opened to new coal leases, notwithstanding previous language in the Mineral Leasing Act and Federal Land and Policy Act.
- Excluded lands from these 4 million acres include federal land within National Parks, Wilderness Areas, National Wildlife Refuges, National Monuments, and National Recreation Areas.
Decreased Federal Coal Royalty Rates
- The Big Beautiful Bill Temporarily cuts the federal surface coal royalty rate from 12.5% to 7% from the time of the bill’s enactment (July 4th, 2025) to 2034. This applies for both existing and future leases.
- This reduction provides financial relief and more of an incentive to keep federal coal production going for North Dakota coal companies.
Expedited Lease and Environmental Review Process
Coal leases applications have been egregiously time-consuming in the past due to drug out environmental reviews by federal agencies. That will be no more, as the language of the bill states:
- No later than 90 days after the enactment of the Act (July 4th, 2025), the Secretary of the Interior (former Gov. of ND, Doug Burgum) shall:
- Publish any required environmental review if not previously published for public comment
- Establish the fair market value of the applicable coal tract (in the qualified application)
- Hold a lease sale with respect to the applicable coal tract
- Identify the highest bidder at or above the fair market value and take all other intermediate actions necessary to identify the winning bidder and grant the qualified application; and
And goes on to say…
- The Secretary of the Interior may, with respect to a previously issued coal lease, grant any additional approvals of the Department of the Interior required for mining activities to commence
Leveling the Playing Field for Energy-Related Tax Credits
For too long, the federal government has been incentivizing intermittent power resources such as wind and solar. Now, forward-looking policies are being put in place – like implementing incentives for enhanced oil recovery.
- The 45Y and 48E tax credits, which incentivize net-zero carbon technologies such as solar and wind energy projects, must begin construction by mid-2026 or be placed in service by the end of 2027 to qualify.
- Companies with significant ties to specific foreign entities (like China) risk losing eligibility
- Raises the Enhanced Oil Recovery Tax Credit from $60/ton to $85/ton – matching the Carbon Sequestration Credit.