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That makes two direct air capture acquisitions for the oil and gas major.
The Trump administration may not be enthusiastic about supporting megaprojects to suck carbon dioxide out of the air, but that’s not dampening Occidental Petroleum’s interest in the technology. Heatmap has learned that the oil and gas giant recently acquired the direct air capture startup Holocene for an undisclosed amount.
This is the second direct air capture company the fossil fuel producer has acquired in less than two years through its subsidiary, Oxy Low Carbon Ventures. It’s a sign “that the sector has legs,” Jason Hochman, the executive director of the Direct Air Capture Coalition, told me. “Why would Occidental acquire Holocene if they didn’t see a future in the sector as a whole? If they didn’t think there was money to be made?”
Like every other climate tech industry, direct air capture startups have faced a great deal of uncertainty since Trump took office. While the technology has historically had bipartisan support, the Trump administration has been excising programs and projects with seemingly any connection to climate change. It has hollowed out the Department of Energy’s carbon dioxide removal team, my colleague Katie Brigham reported in February, leaving just one employee overseeing the $3.5 billion Direct Air Capture Hubs program that was authorized by the Infrastructure Investment and Jobs Act. Additional cuts at the Office of Clean Energy Demonstrations, which also has a role in overseeing the program, or even a potential closure of that office, are expected in the coming weeks. The Direct Air Capture Hubs were also on a list of grants the administration was considering trying to cut.
Non-governmental funding for DAC is also precarious, as interest from new buyers in purchasing carbon removal has waned. A few companies have continued to announce new projects and deals, but Hochman told me he expects to see a fair amount of consolidation of the industry in the near term.
Occidental previously acquired Carbon Engineering, a pioneer in direct air capture technology, for $1.1 billion in August 2023, after working closely with the Canadian company to build its first major project in the United States. That project, a plant called Stratos in Ector County, Texas, is now nearing completion and expected to begin operating later this year. It’s designed to siphon 500,000 tons of carbon dioxide from the air per year.
Holocene “has an innovative direct air capture technology that is additive to Carbon Engineering,” William Fitzgerald, a spokesperson for Occidental told me in an email. “We believe combining these technologies will enable us to advance our R&D activities to improve the efficiency of our direct air capture process, reduce CO2 capture costs, and accelerate DAC deployment.”
Oxy’s acquisition of Carbon Engineering was controversial among climate advocates. While many see direct air capture as a promising way to clean up the excess carbon that will remain in the atmosphere even after emissions decline, skeptics worry that oil companies will use it as justification to keep producing oil — a fear that Oxy has not exactly allayed.
The company plans to take some of the carbon it captures and sequester it in dedicated carbon storage wells. It signed a deal to sequester 500,000 tons of carbon on behalf of Microsoft last year. But it will also pump carbon into aging oil wells to increase oil production, a process called enhanced oil recovery. In the past, Oxy’s CEO Vicki Hollub has framed its investments in direct air capture tech as a way to produce “net-zero oil,” and as a “license to continue to operate” as an oil producer.
More recently, Hollub has shifted her pitch to appeal to the Trump administration’s push for energy dominance. On an earnings call in February, she told investors that the industry could tap an additional 50 billion to 70 billion barrels of oil with the help of carbon captured from the atmosphere.
But direct air capture — both the technology itself, and the market for it — is still in its infancy. There are only so many deep-pocketed buyers like Microsoft willing to pay for sequestration. Unless Occidental sees more demand for carbon removal, its best business case for developing the technology is to recover oil.
“I understand the skepticism in certain quarters,” Hochman told me. “But the fact is that companies like Occidental have the exact set of expertise, of infrastructure, of the people who understand subsurface geology, and the balance sheets to do large projects and to scale this technology.” They’ll be able to build projects at scale much more quickly than a startup that spun out of a university lab, he said.
That’s not quite what Holocene is, but it’s not far off. A trio of MBA students at Stanford — two of whom were veterans of the leading direct air capture company Climeworks — started Holocene in 2023. They wanted to pursue a new approach to sucking carbon from the air that they licensed from the Oak Ridge National Laboratory, a government lab. I wrote about the startup last fall when it announced a deal to remove 100,000 tons of carbon from the atmosphere for Google at a record low price of $100 per ton.
At the time, Holocene had raised about $6 million from grants, prizes, and smaller carbon removal contracts, and built a very small pilot plant in Knoxville, Tennessee, that could scrub just 10 tons of CO2 from the air per year. When I last spoke to them, they were looking for funding to build a larger demonstration plant. They declined to comment for this story.
Holocene’s technology is similar to that of Carbon Engineering. Both companies use fans to pull air into a closed system, where it passes through a liquid with a unique chemistry that attracts CO2. In the case of Carbon Engineering, the carbon in the air binds with potassium hydroxide in water; in Holocene’s system, it binds with amino acids. Then both companies react that carbon-rich water with another chemical that further concentrates the CO2 into solids that can be filtered out. The last step is heating those solids, releasing the CO2 so that it can be sequestered underground.
Holocene’s advantage — and the reason it thinks it can achieve $100 per ton carbon removal — is that it uses a unique chemistry that requires relatively low heat to separate the CO2. Whereas Carbon Engineering uses natural gas for that final step, Holocene told me it could use renewable electricity, or even waste heat from a data center.
Hochman was hopeful that the deal would be an encouraging signal to the market. “It’s real money changing hands because of the hypothesis on the part of a large company that there’s a future in DAC. I would see that as something that would reassure investors in this sector, if not catalyze more investment.”
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The $7 billion program had been the only part of the Greenhouse Gas Reduction Fund not targeted for elimination by the Trump administration.
The Environmental Protection Agency plans to cancel grants awarded from the $7 billion Solar for All program, the final surviving grants from the Greenhouse Gas Reduction Fund, by the end of this week, The New York Times is reporting. Two sources also told the same to Heatmap.
Solar for All awarded funds to 60 nonprofits, tribes, state energy offices, and municipalities to deliver the benefits of solar energy — namely, utility bill savings — to low-income communities. Some of the programs are focused on rooftop solar, while others are building community solar, which enable residents that don’t own their homes to access cheaper power.
The EPA is drafting termination letters to all 60 grantees, the Times reported. An EPA spokesperson equivocated in response to emailed questions from Heatmap about the fate of the program. “With the passage of the One Big Beautiful Bill, EPA is working to ensure Congressional intent is fully implemented in accordance with the law,” the person said.
Although Solar for All was one of the programs affected by the Trump administration’s initial freeze on Inflation Reduction Act funding, EPA had resumed processing payments for recipients after a federal judge placed an injunction on the pause. But in mid-March, the EPA Office of the Inspector General announced its intent to audit Solar for All. The results of that audit have not yet been published.
The Solar for All grants are a subset of the $27 billion Greenhouse Gas Reduction Fund, most of which had been designated to set up a series of green lending programs. In March, Administrator Lee Zeldin accused the program of fraud, waste, and abuse — the so-called “gold bar” scandal — and attempted to claw back all $20 billion. Recipients of that funding are fighting the termination in an ongoing court case.
State attorneys generals are likely to challenge the Solar for All terminations in court, should they go through, a source familiar with the state programs told me.
All $7 billion under the program has been obligated to grantees, but the money is not yet fully out the door, as recipients must request reimbursements from the EPA as they spend down their grants. Very little has been spent so far, as many grantees opted to use the first year of the five-year program as a planning period.
Without the federal tax credit and until battery prices come down, automakers will have to argue that pricey EVs are worth it.
America’s federal tax credit for buying an electric car was supposed to be the great equalizer, an incentive meant to solve for the fact that EVs have long been more expensive than the polluting fossil fuel vehicles they must replace.
That tax credit is now dead. Thanks to the Republican budget reconciliation bill pushed through Congress this summer, the incentive will die after September 30 of this year.
Its demise comes at a particularly inopportune time. For a long time, even a $7,500 benefit wasn’t enough to make many of the best electric cars cost-competitive with their gasoline-powered rivals. Slowly, that had begun to change: More EVs with a starting MSRP in the $30,000 range, such as the base-level Chevy Equinox EV, could compete directly on price with internal combustion once the tax credit (along with any state and local incentives) was taken into consideration.
Without the tax credit, most EVs can’t compete on price alone. Battery production costs are falling, but not fast enough for a new EV in America to cost the same as a comparable gas car. With electricity prices seemingly set to rise, the appeal of never again buying gasoline isn’t as strong. At the same time, the federal government has been trying to add new, nonsensical taxes on EV ownership. Cars.com says the tax credit was a major reason half of EV owners cited for choosing their vehicle, and that it’s driving the decision for about half of curious buyers.
Add it all up and a big group of American shoppers who might have considered buying an EV if the dollars and cents added up probably won’t, at least for now. The mess leaves electric vehicle makers in a precarious position. They must convince American drivers that EVs are simply superior — more capable, more dependable, and more fun. As longtime Rivian executive Jiten Behl told InsideEVs’ Patrick George last week: “Forget they’re electric for a moment. They’re just better cars. And a better product will always win.”
That argument is an existential one for Rivian, which Behl departed last year. Deliveries of its long-awaited R1S SUV started in 2022, and since then the vehicle has become a Range Rover-replacing status symbol in my part of Los Angeles. But after three years, most people with the means and desire to buy a $70,000 to $80,000 EV have done so, yet the company’s more affordable R2 and R3 vehicles remain at least a year away.
Rivian’s solution for the meantime is to push the limit of electric vehicle performance, dollars be damned. This summer, I’ve driven triple-motor Tri Max versions of both the R1S and the R1T pickup trucks. Zooming from a stop, its 800-plus horsepower and instantaneous torque is whiplash-inducing. Put in Conserve mode and the vehicles approach 400 miles of range, enough to obliterate range anxiety. There’s plenty of power for towing and off-roading, plus all the other functionalities that make EVs better than combustion cars: using the vehicle battery to power one’s home or other uses, Dog Mode, or tapping into battery power to pre-condition the cabin on a scorching or frigid day.
Gas vehicles have modes, of course. Over the past decade or two, drivers have gotten used to the way that “sport” or “eco” modes subtly change the character of a car. In a super-EV like the Rivian, having so much capability at your fingertip feels like the EV could become a totally different car at the push of a button. For the Tri Max models, this level of muscular competence costs north of $100,000. But such prowess speaks to someone out there. Rivian has been developing the more-ultimate-than-ultimate electric vehicle, a quad-motor version with horsepower in the four digits, for those in the “money is no object” tax bracket who’ve been convinced that electric is better (or at least that electric is the future, and they want to own it).
A more telling case will be next year’s arrival of the R2, a two-row electric SUV meant to cost in the neighborhood of $45,000. Without the tax credit, prospective buyers can’t tell themselves that it’s really in the $30,000s. On price, then, it’s competing with BMW SUVs, not Chevys.
This is nothing new for the EV market. Selling electrics as luxury cars with a high price tag helps to mask the cost of the battery, and it brings in more revenue for a startup company like Rivian that desperately needs it. Tesla sold a lot of cars this way even though its refinements, build quality, and creature comforts weren’t quite up to par compared to a Mercedes-Benz or a BMW. Part of the luxury people paid for was the feeling of owning the cool new thing, at least back before Tesla’s brand was tainted.
It’s a bit trickier for legacy car companies, who are struggling to navigate shifting attitudes and incentives in America and to compete against cheap, Chinese-made EVs abroad. Take the Hyundai Ioniq 9 that arrived this summer. Hyundai and Kia are the farthest along of the traditional brands in selling great EVs to Americans, and the Ioniq 9 may be the best electric offering for families that need a three-row vehicle to accommodate their tribe. Thanks in part to the hulking 110-kilowatt hour battery needed for this boat to have 300 miles of EPA-rated range, however, the Ioniq 9 starts at $59,000 — more than $20,000 higher than Hyundai’s similarly sized, gas-powered Palisade.
Even a $7,500 benefit wouldn’t bridge such a divide between electric and gas. So, Hyundai bet all along that, incentives or not, buyers would find the Ioniq 9 to be the premium product that it proved to be during my road trip test drive in one this past weekend. Where the Palisade comes with 291 horsepower from its gas engine, Ioniq 9’s 422 electric horsepower allowed the big vehicle to accelerate effortlessly onto the highway and zoom up the Grapevine mountain pass that leads into Los Angeles, dusting plenty of combustion-powered cars huffing and puffing to get uphill. It is remarkably spacious and startlingly quiet, even when putting out lots of power.
My top-of-the-line Ioniq 9 had numerous tech features meant to make it feel special, like the enormous curved touchscreen that spanned from dashboard to center console and the heads-up display — specs that feel futuristic and attempt to justify the extra cost. But let’s be real. For anyone who’d choose a $60,000 EV over the same company’s $40,000 gas-guzzling SUV, it comes down to the simple, everyday advantages of an electric car: Your home is your gas station and you begin every day with a full tank. You’re sitting on a big battery full of electricity that can be used for more than driving, whether that’s backing up your home appliances during a blackout or just air-conditioning your dog while you run into the drugstore. No oil changes. No belts, sparks plugs, or antifreeze to worry about. No tailpipe emissions poisoning your city’s air or filling your garage with carbon monoxide. Immediate power at your feet. And, of course, the possibility of one day running the family car entirely on clean energy.
None of those reasons will change the financial calculation and make the EV less expensive in the long run. For now, the argument for EVs is that you get what you pay for. When more Americans experience a premium EV, that might be enough to convince them that electric is worth the extra cash, tax credit or not.
On residential solar dims, New Jersey makes history, and Brazil’s challenge
Current conditions: Tropical Storm Dexter has formed in the Atlantic, sending rough surf and rip currents to beaches along the U.S. East Coast • Heavy rainfall threatens flooding in southern Taiwan and northern Vietnam • Storm Floris is battering Scotland with winds of up to 80 miles per hour.
Two top GOP senators are pushing back on President Donald Trump’s executive order aimed at severely restricting access to tax credits for renewables before a phaseout begins next year. Iowa Senator Chuck Grassley and Utah Senator John Curtis placed holds on three Trump nominees to the Treasury Department, the agency in charge of writing the rules and guidance for the tax provisions of the One Big Beautiful Bill Act.
Grassley had negotiated a “glidepath for an orderly phaseout” of tax credits for wind and solar, he said in placing the hold, giving developers until next July to start construction on projects. But in an apparent concession to hard-line Republicans in the House of Representatives, Trump signed an executive order days after the bill became law calling for a new guidance to restrict what it means to start construction. As my colleague Matthew Zeitlin wrote yesterday, the executive order “has generated understandable concern within the renewables industry” ahead of the deadline in two weeks for the Internal Revenue Service to issue its new guidance. A more restrictive interpretation of what “begin construction” means “could turn the tax credit language into a dead letter,” Matthew reported. Grassley warned that, “until I can be certain that such rules and regulations adhere to the law and congressional intent, I intend to continue to object to the consideration of these Treasury nominees.”
Chemicals giants Chemours, DuPont, and Corteva agreed Monday to pay out $875 million over the next 25 years to support communities affected by pollution from “forever chemicals,” The New York Times reported. New Jersey officials called this the biggest environmental settlement ever achieved by a single state. As part of the deal, the companies are required to fund the cleanup of four former industrial sites, create a remediation fund of up to $1.2 billion, and put $475 million aside to guarantee the remediation goes forward even if any of the companies go bankrupt. Per- and polyfluoroalkyl substances, typically shortened to PFAS, are called “forever chemicals” because they accumulate in water and in human bodies and never leave. They are linked to all kinds of kidneys and testicular cancer, high cholesterol, and liver damage. “PFAS are particularly insidious,” New Jersey Attorney General Matthew J. Platkin said in a statement. “These dangerous chemicals build up and accumulate everywhere, and New Jersey has some of the highest levels of PFAS in the country.”
As my colleague Jeva Lange has written, “The United States Geological Survey estimates that as much as 20% of Americans drink, bathe, and brush their teeth with PFAS-contaminated water.” During his first administration, Trump promised to crack down on PFAS. But in May, his Environmental Protection Agency delayed enforcement of federal drinking water limits until 2031, and said it would reconsider rules completed under the Biden administration.
Just 7.5% of suitable owner-occupied residential homes in the United States had installed rooftop solar panels as of the end of 2024. With tax credits and support from the Biden administration’s policies, that segment would have grown by 9% per year over the next five years to reach an adoption rate of 13% nationwide by 2030. But of course, Trump won the election and passed the One Big Beautiful Bill Act. Now new data from the consultancy Wood Mackenzie show that residential solar capacity could fall by 46% below those previous projections. That’s due in part to the new federal policies directly, but it also takes into account the potential for no interest rate cuts over the next five years thanks to Trump’s larger economic agenda.
For years, Tesla has cultivated a fandom akin to the cultish following around Apple products in the early 2010s. But since CEO Elon Musk entered the political sphere as a top surrogate for Trump last summer, brand loyalty for the electric automaker has plunged, according to new data the research firm S&P Global Mobility shared with Reuters. Using data gleaned from vehicle registrations in all 50 states, the report shows that Tesla’s customer loyalty peaked in June 2024, the month before Musk endorsed Trump. At that point, 73% of Tesla-owning households in the market for a new car bought another Tesla. By March, the rate had nosedived to 49.9%, just below the automotive industry average.
Dead trees in the Brazilian Amazon. Mario Tama/Getty Images
During his first stretch in office in the early 2000s, Brazil’s President Luiz Inácio Lula da Silva oversaw a miracle few developing countries had ever accomplished: He slashed deforestation while riding the global commodities boom to grow South America’s largest economy and lift millions out of poverty. Since returning to office in 2022, the left-wing leader better known as Lula sought once again to crack down on the destruction of the Amazon while expanding Brazil’s oil and gas production.
His government now faces an uncomfortable pivot point. His environment minister, Marina Silva, is battling legislation that would gut conservation rules in what the Financial Times called “the biggest potential setback to environmental protection in Brazil in four decades.” At the same time, British oil giant BP announced Monday its biggest oil and gas discovery in 25 years off the coast of Brazil. Striking the right balance is more important than ever as the 79-year-old Lula prepares for a tough reelection campaign next amid ratcheting tensions with Trump. Brazil is also the site of the next United Nations climate conference, COP30, which will take place in Belém in November.
The global economic losses associated with the health costs of plastics pollution now top $1.5 trillion annually, according to a new paper in The Lancet. But the esteemed medical journal notes that the “continued worsening of plastics’ harms is not inevitable. Similar to air pollution and lead, plastics’ harms can be mitigated cost-effectively by evidence-based, transparently tracked, effectively implemented, and adequately financed laws and policies.”