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On a permitting bill shocker, spiking gas bills, and China’s nuclear progress
On Turkey’s COP31 win, data center dangers, and Michigan’s anti-nuclear hail mary
On ravenous data centers, treasured aluminum trash, and the drilling slump
On power prices keep climbing, TVA’s ‘historic’ gas buildout, and mounting climate woes
Current conditions: A powerful storm is rolling in from the Pacific to dump several inches of rain across Southern California, threatening floods • The Northeast is set to remain roughly 5 degrees Fahrenheit below historical averages, with New York City topping out at 50 degrees • A major storm is developing over Namibia, bringing flooding to its southern regions.
Governor Josh Shapiro.Win McNamee/Getty Images
Pennsylvania Governor Josh Shapiro has withdrawn his state from the Regional Greenhouse Gas Initiative, leaving the state with the fourth-highest emissions in the country without a significant climate policy. The cap-and-trade market included 10 other states, including all of New England, New York, and some Mid-Atlantic states. After a two-year legal fight over the state’s decision to quit the carbon-cutting alliance through regulatory fiat, Virginia’s Republicans governor successfully exited the group. But, as E&E News noted, Shapiro is the first governor from any party to sign legislation pulling his state out of RGGI. The millions generated from RGGI were earmarked for clean energy and transportation projects in the commonwealth. Philadelphia’s transit system is teetering on the brink of a budget crisis, alongside the bus and light-rail network in San Francisco and Chicago, Heatmap’s Emily Pontecorvo wrote last month. Shapiro, widely considered a serious contender for the Democratic presidential nod in 2028, has sought to dominate the moderate lane in his party, maintaining vocal support for Israel, touting his popularity with his state’s Republican voters, and now reversing a major climate initiative in the name of “cutting costs.”
Meanwhile, in another blow to the climate movement, 350.org, the advocacy group founded by writer Bill McKibben to protest construction of the Keystone XL oil pipeline more than a decade ago, plans to “temporarily suspend programming” in the U.S. amid a funding pinch, Politico reported.
Wholesale electricity rates across the United States are forecast to spike again next year by as much as 8.5% to $51 per megawatt-hour, up from $45 per megawatt-hour this year, according to the latest outlook from the U.S. Energy Information Administration. This year’s prices were already 23% higher than the 2024 average. The biggest driver pushing up rates next year is the northern pricing hub of the Electric Reliability Council of Texas, the state’s independent grid operator, as demand from data centers and cryptocurrency mines exceeds available supply. The EIA warned that natural gas prices are the primary determinant of power prices. “But in 2026,” the federal analysts wrote, “the increase in power prices in ERCOT tends to reflect large hourly spikes in the summer months due to high demand combined with relatively low supply in this region.” Rising electricity rates could make the pitch for electrifying heating, appliances, and transportation a tougher sell, as Heatmap’s Katie Brigham wrote.
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Lithium is geographically limited, costly to mine, and, in batteries, has a bad tendency to overheat and blow up. Sodium-ion batteries solve all of those problems. But it’s been difficult to get sodium ions to move quickly and reliably through solids. Scientists at Western University in Ontario say they have a fix by formulating a new material containing sulfur and chlorine. Traditional electrolytes are chemically stable, but tend to move sodium ions too slowly between the positive and negative ends of a battery. Adding sulfur to the design boosts the conductivity by making it easier for ions to volley through the battery.
Katie has covered the nascent sodium-ion battery business well. Back in April, she wrote about the death of the startup Bedrock Materials. Last month, she described how the startup Alsym planned to break the industry’s streak of failures and establish a manufacturing line in the U.S.
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In his first few months in office, President Donald Trump fired most of the Tennessee Valley Authority’s board of directors and, in July, demanded the remaining members terminate the federally owned utility’s top brass. But CEO Don Moul has held onto his job, and is now singing a tune the administration should like. On Thursday’s earnings call, Moul said the TVA was “undertaking one of the largest new asset campaigns in our history,” with 3.7 gigawatts of new generation under construction. What kind of generation? It’s “a historic gas build right now,” the TVA’s finance chief Tom Rice said, according to Utility Dive. The utility is also developing new nuclear fission and fusion power plants, including what may be the nation’s first small modular reactor.
Global emissions from fossil fuels are on track to rise 1.1% this year, reaching an all-time high, according to data published Thursday by the Global Carbon Project. “Keeping global warming below 1.5 degrees Celsius is no longer plausible,” Pierre Friedlingstein, a climate researcher at the University of Exeter who led the study, told E&E News. The findings also suggested that the amount of carbon the planet’s land and forests absorb “is substantially smaller than previously estimated,” while the volumes the ocean takes in are now understood to be even greater, Bloomberg noted.
A new study by researchers at Pusan National University in South Korea illustrated what’s at stake for big global systems as temperature rises beyond humanity’s control. Melting sea ice in polar regions is transforming how oceans move and mix. New models to examine previously difficult-to-study patterns found that sea ice loss “strengthens currents and turbulence, particularly in the Arctic and Southern Oceans,” and that “such changes are expected to substantially alter the transport of heat, carbon and nutrient, ultimately affecting polar marine ecosystems.”
The symbolism is almost eerie, a microcosm of the violence and discomfort heralded by rising global temperatures. As the global climate summit in the Amazonian city of Belém reaches the end of its first week, the United Nations has scolded Brazil for failing to maintain security at the conference and keep the facilities at a comfortable air conditioned temperature.
In some cases, rising electricity rates are the least of a company’s worries.
Skyrocketing electricity prices are hitting Americans hard, which makes one wonder: Are electrification-based technologies doomed? No doubt sectors like green hydrogen, clean fuels, low-carbon steel and cement, and direct air capture would benefit from a hypothetical world of cheap, abundant electricity. But what happens if that world doesn’t materialize anytime soon?
The answer, as it so often turns out, is significantly more complicated than a simple yes or no. After talking with a bunch of experts, including decarbonization researchers, analysts, and investors, what I’ve learned is that the extent to which high electricity prices will darken the prospects for any given technology depends on any number of factors, including the specific industry, region, and technical approach a company’s taking. Add on the fact that many industries looking to electrify were hit hard by the One Big Beautiful Bill Act, which yanked forward deadlines for clean hydrogen and other renewable energy projects to qualify for subsidies, and there are plenty of pressing challenges for electrification startups when it comes to unit economics.
“Having lower energy prices is good for everybody,” Bryan Fisher, a managing director at the energy think tank RMI focused on industrial decarbonization, told me simply. And so when those prices go up, “the biggest macro theme is it hurts industries or applications of industry unevenly — green hydrogen being the biggest one.”
There was a general consensus among the people I spoke with that electrolytic hydrogen — known as green hydrogen if it’s produced with renewable electricity — is the clearest casualty here. That’s unsurprising given that electricity drives roughly 60% to 70% of its production cost, as it powers the process that splits water into hydrogen and oxygen. Rising hydrogen costs will also have knock-on effects across other emergent industries, as many companies and investors are banking on green hydrogen to replace fossil fuels in hard-to-electrify sectors such as chemical production or long-haul transport.
Fisher told me that rising electricity costs now means that the transition from blue hydrogen — produced from natural gas feedstock, with carbon capture and storage to control emissions — to green hydrogen will be prolonged. “What we always thought was going to happen was that a blue hydrogen market would develop and be replaced by green as those costs went down,” Fisher explained. “So I think the time at which the market will utilize low-emissions blue hydrogen is just extended.”
Dan Lashof, the former U.S. director and a current senior fellow at the World Resources Institute, told me that if and when hydrogen projects scale, circumventing the rising costs of grid electricity with behind-the-meter renewable power could be a viable option, given that new wind and solar generation remains quite cheap. He also emphasized the other factors at play when it comes to making green hydrogen economically feasible — mainly the high cost of electrolyzers themselves, the devices that split water into its component parts. “Tariffs on Chinese imports are going to be a big factor in terms of electrolyzer costs,” he told me. That leads him to ask, “will other countries like India step up and be able to produce low cost electrolyzers for the U.S. market?”
Among industries that rely on green hydrogen, sustainable aviation and green shipping might suffer the most, as hydrogen is a necessary ingredient in certain net-zero fuels. But high electricity prices — and by extension green hydrogen costs — are far from their only financial concern. Producing clean fuels often requires combining hydrogen with captured carbon to synthesize hydrocarbons.Sourcing and capturing CO2, breaking it down into carbon monoxide, and synthesizing hydrocarbons are all expensive in and of themselves.
Fisher told me that when it comes to the category of sustainable aviation fuels known as e-SAF, which is made from green hydrogen and captured carbon dioxide, innovations in these other areas — as well as economies of scale — are more likely to make a meaningful dent in fuel prices than cheaper electricity. “Power prices going up 20% adds about $1 or $1.50 a gallon to e-SAF,” he explained. “And right now we’re probably $5 to $7 out of the money.” So while lower electricity prices would certainly be welcome, the industry needs cost breakthroughs on multiple fronts before this fuel has a shot at competing.
Some companies, including Twelve, require electrolyzers to break down both CO2 and H2O. Rajesh Swaminathan, a partner at Khosla Ventures, told me he simply doesn’t think the current approaches to e-SAF will get there economically. “It’s a terrible economic idea. It doesn’t pass any kind of sniff test,” he said. “Even if electricity prices were extremely low, this will not be competitive from a capex and opex perspective,” he said, referring to both capital expenditures and the cost of operating the business.
Khosla has instead invested in Lanzatech, which sources carbon-rich gases from industrial facilities such as steel mills and ferments them into ethanol, which can then be chemically converted into jet fuel. Its core process doesn’t rely on green hydrogen or electrolysis at all. “That’s such a low-cost approach that will meet the SAF targets of $4 per gallon,” Swaminathan told me — a claim that remains to be seen, of course.
Efforts to decarbonize high heat industrial processes such as steel and cement production also rely heavily on electrification. The clean cement company Sublime Systems and clean steel companies Boston Metal and Electra, for instance, all use electricity-driven chemical processes to replace the need for burning fossil fuels in either cement kilns or the blast furnaces used in steel production.
The companies themselves often emphasize the importance of low electricity prices for making this tech cost-competitive. For example, when Boston Metal’s CEO Tadeu Carneiro was asked by a Time magazine reporter two years ago about where the company would source the enormous amount of electricity needed to melt iron ore as planned, he replied, “If you don’t believe that electricity will be plentiful, reliable, available, green, and cheap, forget about it,” essentially acknowledging the tech won’t pencil out in the absence of cheap power. He added that there are regions such as Quebec and Scandinavia — both of which have abundant hydropower resources — where it would make economic sense to deploy Boston Metal’s tech sooner rather than later. Similarly, Sublime is building its first commercial-scale clean cement plant in Holyoke, Massachusetts, where it’s sourcing power from the city’s hydroelectric dam.
“We have to believe that the electricity will be available,” Carneiro told Time.
Lashof told me that in the meantime, higher electricity prices will “push industrial decarbonization more towards using carbon capture and sequestration pathways” over electrification-driven approaches. But Fisher thinks that in many cases there’s still “headroom” for electrification of power and heat to make sense domestically, even with a relatively significant “20% to 30% type increase” in electricity costs.
“If you’re doing a heat by electrification project at your industrial site, in some cases it’s an adaptive problem, not an economic problem.” he told me. Indeed, plants will need to be redesigned — no small cost in itself — and teams must be willing to change their systems and processes to accommodate new technologies. That organizational inertia could, in some cases, prevent the adoption of novel electrification tech, even if electricity prices would support it.
One technology that Fisher is absolutely certain isn’t constrained by electricity prices so much as the lack of a fundamental technical breakthrough is engineered carbon removal, such as direct air capture. “Innovation is the key, not low power prices, because we need to get from $500 bucks a ton in carbon removal to $50 bucks a ton,” he told me. While DAC certainly requires loads of electricity to pull CO2 out of the air and chemically separate it, that won’t be enough to conjure the 90% price reduction necessary before DAC can reach scale.
But rest assured, rising electricity prices will also create some winners, with energy efficiency likely to be at the top of the list, Duncan Turner, a general partner at venture capital firm SOSV, told me. Personally, he’s excited about everything from innovations in HVAC systems to companies developing more energy-efficient chemical separation processes, low-power light-based data transfer hardware for data centers, and plasma-based cooling products for computing chips.
Energy efficiency isn’t the only category he thinks stands to benefit. “There’s a bunch of long-duration energy storage companies that will look very interesting indeed as the price of electricity starts to go up and the demand for electricity from data centers starts to peak,” Turner told me. Like Fisher, he also sees an opportunity for point-source carbon capture, viewing it as a way to “very quickly get cheaper and cleaner electricity onto the grid.”
Moments like these are also when investors are quick to remind us that betting on consistency across seemingly any dimension — whether that’s clean energy incentives, the funding environment, or commodity prices — is often a losing strategy. Or, as Turner put it, “It’s probably for the good for the whole industry — our community as a whole — that we reset to, We work better than anything else, even when there’s expensive electricity.”
