Hallador Energy’s proposed deal to supply a ‘global data center developer’ with coal-fired power generation has fallen through.

The company announced the cancellation of the proposed supply agreement in a filing with the SEC last Thursday. Following the cancellation, Hallador’s stock price took a nosedive, falling up to 19 percent at the market's close.

The Indiana-based energy company had initially announced the deal last November, after signing a non-binding term sheet with an unnamed data center firm.

The company had cited the surging demand in data centers as a “meaningful opportunity,” presenting the opportunity to transform its long-term financial profile.

Despite the deal’s nixing, Hallador said it remains optimistic about its future prospects and is actively seeking alternative opportunities with several other parties.

DCD has contacted Hallador for further comment.

Hallador has two company segments: coal operations and electricity generation. Its electric operations facilities include Merom Power Plant, a two-unit, 1080MW-rated coal-fired power plant located in Indiana.

The announcement follows President Trump's administration's repositioning of coal as a central energy source to support the growth of artificial intelligence data centers.

Last month, President Trump signed a series of executive orders to remove “regulatory barriers that undermine coal production, encouraging the utilization of coal to meet growing domestic energy demands, increasing American coal exports, and ensuring that Federal policy does not discriminate against coal production or coal-fired electricity generation.”

The orders came despite coal's steady decline over the past 25 years. The fuel share in the US energy mix has fallen to around 15 percent, compared with 2001 levels, where it generated 51 percent of the US’ energy.

However, given the staggering projected growth in energy demand tied to the data center sector, some utilities have already announced their intention to extend the life of their coal plants. A recent example is Southern Company, which in February announced its intention to extend the life of three plants with a combined capacity of 8.2GW from 2028 to 2035.

If the Trump administration gets its wish and coal regains a foothold in the country’s energy mix, it could have a considerable impact on the country’s overall emission profile. Coal is by far the most polluting form of energy, releasing twice as much CO2 as natural gas, while being much more inefficient.

It is also now more expensive than renewable alternatives such as solar. However, with the Trump administration's bid to roll back the provisions of the Inflation Reduction Act, which was designed to bolster the country’s renewable sector, we could see more and more utilities turn to coal as an option.