From the earliest days of his foray into politics, President Donald Trump has made revitalizing the American steel industry a top domestic priority. Following major success on this front in his first term, Trump has picked up where he left off in his second term. After decades of mill closures, offshoring, and dependence on foreign producers, investment is returning, imports are falling, and American steel is once again gaining ground.
But the next stage of that renaissance will depend on whether the United States can produce enough reliable and affordable energy to sustain it.
Few industries are more important to national security than steel, which forms the backbone of warships, armored vehicles, missiles, bridges, railroads, pipelines, buildings, and the electric grid itself. A nation that cannot produce steel at scale cannot remain economically independent or militarily secure.
For decades, however, America allowed that strategic capacity to erode. Cheap, heavily subsidized Chinese steel flooded global markets, while costly regulations and climate policies placed domestic producers at a growing disadvantage. From 2000 to 2015 alone, the U.S. steel industry shed more than one third of its workforce as communities throughout the former Steel Belt watched factories close and economic opportunity disappear.
Trump recognized that this was a strategic vulnerability, not just ordinary economic competition. His Section 232 tariffs, imposed during his first term and strengthened after his return to office, gave American producers room to invest, expand, and compete again.
Brandon Farris, executive vice president of the Steel Manufacturers Association, recently called the tariffs “the most pro-manufacturing executive action in a generation.” He pointed to more than $25 billion in domestic steel investment, capacity utilization above the industry’s critical 80 percent threshold, and steel imports falling by nearly 30 percent. The United States has also overtaken Japan to become the world’s third-largest steel producer for the first time in 25 years.
Those gains occurred as a direct result of Trump’s tariffs.
The independent U.S. International Trade Commission reached a similar conclusion about the original Section 232 measures. Its analysis found that the tariffs reduced imports of affected steel products by 24 percent and increased U.S. steel production by 1.9 percent. Although critics warned of devastating costs for manufacturers that use steel, the commission found that downstream prices increased by only 0.2 percent on average.
More recent figures show the momentum continuing. According to the American Iron and Steel Institute, steel imports fell 12.6 percent from 2024 to 2025, reaching their lowest level since 2020. The Commerce Department also reported that the steel trade deficit in December 2025 was 31.7 percent lower than one year earlier. U.S. production rose 3.1 percent during the same period even as global output declined 2.9 percent.
Professor Massimo Agostini, a retired economist and former Bank of Italy adviser, told me in an interview that many economists came to view tariffs as a necessary emergency response to China’s dominant trade practices. Beijing, he explained, exploited American dependence on imports and accelerated the decline of U.S. manufacturing.
“President Trump reversed this trend, especially in the strategically important steel industry,” Agostini said.
Yet tariffs alone cannot guarantee a permanent manufacturing comeback. American steel remains expensive compared with foreign alternatives, and energy can account for 20 to 40 percent of production costs. Modern electric arc furnaces, which melt scrap steel and other metallic inputs, require enormous amounts of dependable electricity. At peak production, U.S. steel plants can consume as much as 35-40 gigawatts nationwide.
That is why the industry is sounding the alarm over America’s increasingly strained power grid. Electricity costs in the PJM regional market, the largest in the country, rose sharply last year, while demand from artificial intelligence facilities, data centers, and advanced manufacturing continues to surge.
The Energy Information Administration expects U.S. electricity demand to rise one percent in 2026 and another three percent in 2027, the strongest growth period since 2000. PJM, meanwhile, has forecast dramatic long-term load growth across the industrial heartland.
At the same time, reliable generating plants are still scheduled to close. Operators planned to retire 12.3 gigawatts of capacity in 2025, although federal reliability interventions limited actual retirements to 4.6 gigawatts. Nearly 11 additional gigawatts were slated for retirement in 2026, overwhelmingly from coal and natural-gas facilities.
“It’s now clear these estimates were off – renewables can’t yet guarantee the stable supply the industry needs,” Agostini said. “Demand forecasts are unprecedented, and meeting them will require a response on the scale of World War II.”
The Trump administration has already acted to keep critical plants online and committed $625 million to reinvigorate and expand the nation’s coal industry. But the scale of the challenge requires a broader national effort.
The Steel Manufacturers Association has proposed a four-part energy plan modeled on the urgency of the World War II-era Manhattan Project. It calls for bipartisan permitting reform, an end to premature power-plant closures, greater support for energy innovation, and stronger domestic supply chains.
“Steelmakers are ready to lead the American manufacturing renaissance, but we cannot grow domestic production without the energy needed to power it,” Farris said, urging greater certainty and efficiency in federal permitting.
Dr. Ilka Liljenquist, a senior engineer with experience on U.S. mining projects, agreed that “permitting has long been an Achilles’ heel.” She noted that legitimate concerns involving water, nearby communities, and environmental safety must still be addressed. But navigating thousands of overlapping requirements can delay essential projects for years.
The answer is not to abandon responsible safeguards. It is to make permitting faster, clearer, and more predictable while returning appropriate authority to the states. Congress should advance reforms, prevent the premature loss of reliable generating capacity, and clear the way for new coal, natural-gas, nuclear, and other dependable power sources.
Trump understood that America cannot remain a great power if it depends on its adversaries for steel. The next step is recognizing that it cannot manufacture steel – or dominate artificial intelligence, rebuild its military, and compete with China – without abundant energy.
The U.S. steel renaissance has begun. Now America must build the power system that will keep it alive.
Ben Solis is the pen name of an international affairs journalist, historian, and researcher.
