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Here’s a grim fact: The most destructive fires in recent American history swept over a state with the country’s strictest wildfire-specific building code, including in some of the neighborhoods that are now largely smoldering rubble.
California’s wildfire building code, Chapter 7A, went into effect in 2008, and it mandates fire-resistant siding, tempered glass, vegetation management, and vents for attics and crawlspaces designed to resist embers and flames. The code is the “most robust” in the nation, Lisa Dale, a lecturer at the Columbia Climate School and a former environmental policy advisor for the State of Colorado, told me. It applies to nearly any newly built structure in one of the zones mapped out by state and local officials as especially prone to fire hazard.
The adoption of 7A followed years of code development and mapping of hazardous areas, largely in response to devastating urban wildfires such as the Tunnel Fire, which claimed more than 3,000 structures and 25 lives in Oakland and Berkeley in 1991, and kicked off renewed efforts to harden Californian homes.
The Federal Emergency Management Agency’s report on the 1991 fire makes for familiar reading as the Palisades and Eaton fires still smolder. The wildland-urban interface, it says, was put at extreme risk by a combination of dry air, little rainfall, hot winds blowing east to west, built-up vegetation that was too close to homes, steep hills, and limited access to municipal water. The report also castigates the “unregulated use of wood shingles as roof and siding material.”
This was not the first time a destructive fire on the wildland-urban interface had been partially attributed to ignitable building materials. The 1961 Bel-Air fire, for instance, which claimed almost 200 homes, including that of Burt Lancaster, and the 1959 Laurel Canyon fire were both, FEMA said, evidence of “the wood roof and separation from natural fuels problems,” as were fires in 1970 and 1980 near where the Tunnel Fire eventually struck in 1970 and 1980.
But it was the sheer scale of the Tunnel Fire that prompted action by California lawmakers.
Throughout the 1990s, fire-resilient roofing requirements were ramped up, designating which materials were allowed in fire hazard areas and throughout the state. By all accounts, the building code works — but only when and where it’s in force. Dale told me that compliant homes were five times as likely to survive a wildfire. Research by economists Judson Boomhower and Patrick Baylis found that the code “reduced average structure loss risk during a wildfire by 16 percentage points, or about a 40% reduction.”
“The challenge from the perspective of wildfire vulnerability is that those codes are relatively recent, and the housing stock turns over really slowly, so we have this enormous stock of already built homes in dangerous places that are going to be out there for decades,” Boomhower told me.
The 7A building code applies only to new buildings, however. In long-settled areas of California like Pacific Palisades, which has little new housing construction or even existing home turnover due to high costs and permitting complications, especially in areas under the jurisdiction of the California Coastal Commission, many houses are not just failing to comply with Chapter 7A, but also with any housing code at all.
Looking at which homes had survived past fires, Steve Quarles, who helped advise the California State Fire Marshal on developing 7A, told me, “What really mattered was if it was built under any building code.” Many homes destroyed by the fires in Los Angeles likely were not. In Pacific Palisades, fire management is a frequent topic of concern and discussion. But as late as 2018, local media in Pacific Palisades noted that the area still had some homes with wood shingle roofs.
While a complete inventory of homes lost in the Palisades and Eaton fires has yet to be taken, the neighborhoods were full of older homes. According to CalFire incident reports, of the almost 47,000 structures in the zone of the Palisades Fire, more than 8,000 were built before 1939, and 44,560 were built before 2009. For the Eaton Fire area, of the around 41,000 structures, almost 14,000 were built before 1939, and only around 1,000 were built since 2010.
A Pacific Palisades home designed by architect Greg Chasen and built in 2024, however, survived the fire and went viral on X after he posted a photo of it still standing after the flames had moved through. The home embodied some of the best practices for fire-safe building, according to Bloomberg, including keeping vegetation away from the building, a metal roof, tempered glass, and fire-resistant siding.
When Michael Wara, the director of Stanford University’s Climate and Energy Policy Program, spoke with firefighters and insurance industry officials in the process of drafting a 2021 report for the Stanford Woods Institute for the Environment on strategies for mitigating wildfire risk, they told him that, from their perspective, wildfires are often a matter of “home ignition,” meaning that while building near forested areas puts any home at risk, the risk of a home itself igniting varies based on how it’s built and the vegetation clearance around it. “Existing homes in high fire threat areas” built before the implementation of California’s wildfire building codes, Wara wrote, “are a massive problem.” At the time he published the paper, there were somewhere between 700,000 and 1.3 million pre-building code homes still standing in “high or very high threat areas.”
The flipside of focusing on “home ignition” and the building code is that the building code works better over time, as more and more homes comply with it thanks to normal turnover, people extensively renovating, or even tearing down old homes — or rebuilding after fires. Homes that are close to homes that don’t ignite in a fire are more likely to survive.
One study that looked at the 2018 Camp Fire, which destroyed more than 18,000 structures and claimed more than 80 lives in the Northern California town of Paradise, sampled homes built before 1997, between 1997 and 2018, and from 2018 onwards, and found that only 11.5% of pre-1997 homes survived, compared to 38.5% from 1997 and after. The researchers also found that building survivability had a kind of magnifying effect, with distance from the nearest destroyed structure and the number structures destroyed in the immediate area among “the strongest predictors of survival.”
“The more homes that comply, the less chance you get those structural ignitions and the less chance you get those huge disasters like this,” Doug Green, who manages Headwaters Economics’ Community Assistance for Wildfire Program, told me. “It takes people doing the right thing to their own home — dealing with vegetation, making sure roofs are clean, having right roofing. It’s really a community-wide strategy to stop fires that happen like this.”
But just as any home hardening — or just building to code — is more effective the more the homes around you do it as well, it’s just as true in reverse. “If your next door neighbors don’t do that work, the effectiveness of your efforts will be less,” Dale said. “Building codes ultimately work best when we get an entire landscape or neighborhood to adopt them.”
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The FREEDOM Act aims to protect energy developments from changing political winds.
A specter is haunting permitting reform talks — the specter of regulatory uncertainty. That seemingly anodyne two-word term has become Beltway shorthand for President Donald Trump’s unrelenting campaign to rescind federal permits for offshore wind projects. The repeated failure of the administration’s anti-wind policies to hold up in court aside, the precedent the president is setting has spooked oil and gas executives, who warn that a future Democratic government could try to yank back fossil fuel projects’ permits.
A new bipartisan bill set to be introduced in the House Tuesday morning seeks to curb the executive branch’s power to claw back previously-granted permits, protecting energy projects of all kinds from whiplash every time the political winds change.
Dubbed the FREEDOM Act, the legislation — a copy of which Heatmap obtained exclusively — is the latest attempt by Congress to speed up construction of major energy and mining projects as the United States’ electricity demand rapidly eclipses new supply and Chinese export controls send the price of key critical minerals skyrocketing.
Two California Democrats, Representatives Josh Harder and Adam Gray, joined three Republicans, Representatives Mike Lawler of New York, Don Bacon of Nebraska, and Chuck Edwards of North Carolina, to sponsor the bill.
While green groups have criticized past proposals to reform federal permitting as a way to further entrench fossil fuels by allowing oil and gas to qualify for the new shortcuts, Harder pitched the bill as relief to ratepayers who “are facing soaring energy prices because we’ve made it too hard to build new energy projects.”
“The FREEDOM Act delivers the smart, pro-growth certainty that critical energy projects desperately need by cutting delays, fast-tracking approvals, and holding federal agencies accountable,” he told me in a statement. “This is a common sense solution that will mean more energy projects being brought online in the short term and lower energy costs for our families for the long run.”
The most significant clause in the 77-page proposal lands on page 59. The legislation prohibits federal agencies and officials from issuing “any order or directive terminating the construction or operation of a fully permitted project, revoke any permit or authorization for a fully permitted project, or take any other action to halt, suspend, delay, or terminate an authorized activity carried out to support a fully permitted project.”
There are, of course, exceptions. Permits could still be pulled if a project poses “a clear, immediate, and substantiated harm for which the federal order, directive, or action is required to prevent, mitigate, or repair.” But there must be “no other viable alternative.”
Such a law on the books would not have prevented the Trump administration from de-designating millions of acres of federal waters to offshore wind development, to pick just one example. But the legislation would explicitly bar Trump’s various attempts to halt individual projects with stop work orders. Even the sweeping order the Department of the Interior issued in December that tried to stop work on all offshore wind turbines currently under construction on the grounds of national security would have needed to prove that the administration exhausted all other avenues first before taking such a step.
Had the administration attempted something similar anyway, the legislation has a mechanism to compensate companies for the costs racked up by delays. The so-called De-Risking Compensation Fund, which the bill would establish at the Treasury Department, would kick in if the government revoked a permit, canceled a project, failed to meet deadlines set out in the law for timely responses to applications, or ran out the clock on a project such that it’s rendered commercially unviable.
The maximum payout is equal to the company’s capital contribution, with a $5 million minimum threshold, according to a fact-sheet summarizing the bill for other lawmakers who might consider joining as co-sponsors. “Claims cannot be denied based on project permits or energy technology type,” the document reads. A company that would have benefited from a payout, for example, would be TC Energy, the developer behind the Keystone XL oil pipeline the Biden administration canceled shortly after taking office.
Like other permitting reform legislation, the FREEDOM Act sets new rules to keep applications moving through the federal bureaucracy. Specifically, it gives courts the right to decide whether agencies that miss deadlines should have to pay for companies to hire qualified contractors to complete review work.
The FREEDOM Act also learned an important lesson from the SPEED Act, another bipartisan bill to overhaul federal permitting that passed the House in December but has since become mired in the Senate. The SPEED Act lost Democratic support — ultimately passing the House with just 11 Democratic votes — after far-right Republicans and opponents of offshore wind leveraged a special carveout to continue allowing the administration to commence its attacks on seaborne turbine projects.
The amendment was a poison pill. In the Senate, a trio of key Democrats pushing for permitting reform, Senate Energy and Natural Resources ranking member Martin Heinrich, Environment and Public Works ranking member Sheldon Whitehouse, and Hawaii senator Brian Schatz, previously told Heatmap’s Jael Holzman that their support hinged on curbing Trump’s offshore wind blitz.
Those Senate Democrats “have made it clear that they expect protections against permitting abuses as part of this deal — the FREEDOM Act looks to provide that protection,” Thomas Hochman, the director of energy and infrastructure policy at the Foundation for American Innovation, told me. A go-to policy expert on clearing permitting blockages for energy projects, Hochman and his center-right think tank have been in talks with the lawmakers who drafted the bill.
A handful of clean-energy trade groups I contacted did not get back to me before publication time. But American Clean Power, one of the industry’s dominant associations, withdrew its support for the SPEED Act after Republicans won their carveout. The FREEDOM Act would solve for that objection.
The proponents of the FREEDOM Act aim for the bill to restart the debate and potentially merge with parts of the previous legislation.
“The FREEDOM Act has all the critical elements you’d hope to see in a permitting certainty bill,” Hochman said. “It’s tech-neutral, it covers both fully permitted projects and projects still in the pipeline, and it provides for monetary compensation to help cover losses for developers who have been subject to permitting abuses.”
Maybe utilities’ “natural monopoly” isn’t so natural after all.
Debates over electricity policy usually have a common starting point: the “natural monopoly” of the transmission system, wherein the poles and wires that connect power plants to homes and businesses have exclusive franchises in a certain territory and charge regulated rates to access them.
The thinking is that without a monopoly franchise, no one would make the necessary capital expenditures to build and maintain the power lines and grid infrastructure necessary to connect the whole system, especially if they thought someone would build a new transmission line nearby. So while a government body oversees investment and prices, the utility itself is not subject to market-based competition.
But what if someone really did want to build their own wires?
“There are at least two of us who do not think that electricity is a natural monopoly,” Glen Lyons, the founder of Advocates for Consumer Regulated Electricity, told me.
The other one is Travis Fisher, an energy scholar at the Cato Institute, who corrected his friend and colleague.
“Between me, and Joseph Schumpeter, and Wayne Cruz, and Glen Lyons, there’s at least four of us. Only three of us are alive,” Fisher said, referencing the Austrian economist Schumpeter, who died in 1950, and the libertarian scholar Cruz, who was a critic of the restructuring of the electricity market in the 1990s.
Fisher and Lyons, however, are the team behind a proposal put out on Tuesday by the libertarian Cato Institute calling for “consumer-regulated electricity.” Instead of a transmission system with a monopoly franchise that independent generators can connect to and sell power to utilities in a process regulated by a combination of a public utility commission and regional transmission organization or independent system operators, CRE systems would be physically islanded electricity systems that customers would privately and voluntarily sign up for.
Crucially, CRE would not be regulated under existing federal law, and would have no connection to the existing grid, allowing for novel price structures and even physical set-ups, like running on different frequencies or even direct current, Fisher said.
They would also, Fisher and Lyons argue, help solve the dilemma haunting electricity policymakers: how to bring new load on the grid quickly without saddling existing ratepayers with the cost of paying for utility upgrades.
“If enabled, CRE utilities would generate, transmit, and sell electricity directly to customers under voluntary contracts, without interconnecting to the existing regulated grid or seeking permission from economic regulators at the state or federal level,” the Cato proposal reads.
This idea has a natural audience among political conservatives, as it’s essentially a bet that more entrepreneurship and less regulation will solve some of our biggest energy system problems. On the other hand, utilities tend to be a powerful force in conservative politics at both the state and federal levels, which is one reason why these kinds of ideas are still marginal.
But less marginal than they have been.
Consumer-regulated electricity is more than just another think tank white paper. It has also won the approval of the influential American Legislative Exchange Council, better known as ALEC, a conservative group that writes model legislation for state legislatures to adopt. Fisher proposed version of the consumer-regulated utilities plan to the network in December of last year, and ALEC approved it in January.
A few days after the group finalized the model policy to allow CRE at the state level, Arkansas Senator Tom Cotton proposed his own version in the form of the DATA Act, which would “amend the Federal Power Act to exempt consumer-regulated electric utilities from Federal regulation.”
While the CRE proposal is a big conceptual departure from about a century of electricity regulation, the actual reform is modest. Fisher and Lyons propose a structure would apply solely to “sophisticated customers … who voluntarily contract for service and can manage their own risks,” i.e. big industrial users like data centers, not your home.
While this sounds like behind the meter generation, whereby large electricity users such as, say, xAI in Memphis, simply set up their own electricity plants, CRE goes further. The idea is to capture the self-regulation benefits of building your own power within a structure that still allows for the economies of scale of a grid. Or in the words of Cato’s proposal, CRE “would enable third-party utilities to serve many customers, resulting in lower costs, higher reliability, and a smaller environmental footprint compared to self-supply options.”
Fisher and Lyons argue that CRE would also have an advantage over so-called co-location, where data centers are built adjacent to generation and share interconnection with the grid, which still requires interacting with public utility commissions and utilities. The pair have also suggested that the Department of Energy and the Federal Energy Regulatory Commission use its existing rulemaking process on data center interconnection to encourage states to pass the necessary laws to allow islanded utility systems.
While allowing totally private utility systems may be a radical — and certainly a libertarian — departure from the utility regulation system as it exists today, proposals are popping up on both the left and the right to try to reduce utility influence over the electricity system.
Tom Steyer, the hedge fund billionaire and climate investor who is running for governor of California, has said that he would “break up the utility monopolies to lower electric bills by 25%.” In a January press conference, Steyer clarified that he “wants to force utility companies to choose cheaper ways of wildfire-proofing their infrastructure and give customers other options for buying power, including making it easier to build neighborhood-level solar projects or allowing more communities to operate their own local grids,” according to CalMatters. California already has some degree of retail choice, although a more expansive version of a retail competition model infamously collapsed during the 2001 rolling blackouts.
To Fisher, while his and Lyons’ proposal is in some ways radical, it is also not a particularly big risk. If there’s truly no demand for private electricity networks, none will be built and nothing will change, even if there’s regulatory reform to allow for it.“I’m not surprised to see it get traction,” Fisher said of the plan, “just because there’s no downside, and the upside could be absolutely nothing — or it could be a breakthrough.”
On offshore wind wins, China’s ‘strong energy nation,’ and Japan’s deep-sea mining
Current conditions: Yet another snow storm is set to powder parts of the Ohio Valley and the Mid-Atlantic • Cyclone Fytia is deluging Madagascar, causing flooding that left at least three dead and 30,000 displaced in a country still reeling from the recent overthrow of its government • Scotland and England are bracing for a gusty 33-hour blizzard, during which temperatures are forecast to drop below freezing.
He’s fashioned the military’s Defense Logistics Agency into a tool to fund mineral refineries. He’s gone on a shopping spree that made Biden administration officials “jealous,” taking strategic equity stakes in more than half a dozen mining companies. Now President Donald Trump is preparing to launch a strategic stockpile for critical minerals in what Bloomberg billed as “a bid to insulate manufacturers from supply shocks as the U.S. works to slash its reliance on Chinese rare earths and other metals.” Dubbed Project Vault, the venture will be seeded with a $10 billion loan from the Export-Import Bank of the U.S. and another $1.67 billion in private capital. More than a dozen companies have committed to work on the stockpile, including General Motors, Stellantis, Boeing, Google, and GE Vernova.
The shale industry, meanwhile, showed it’s matured enough to go through some consolidation. Oklahoma City-based gas giant Devon Energy is merging with Houston-headquartered Coterra Energy in an all-stock deal that CNBC said would create “a large-cap producer with a top position in the Permian Basin. The deal would establish a combined company with an enterprise value of $58 billion, marking the largest merger in the sector since Diamondback bought Endeavor Energy Resources for $26 billion in 2024. The deal comes as low prices from the global oil glut squeeze U.S. shale drillers — and as the possibility of more oil from Venezuela threatens the sector with fresh competition.
Offshore wind is now five-for-five in its legal brawls with Trump. With Orsted’s latest victory in the Sunrise Wind case on Monday, I’ll let Heatmap’s Jael Holzman serve as the ring announcer spelling out the stakes of the legal victory: “If the government were to somehow prevail in one or more of these cases, it would potentially allow agencies to shut down any construction project underway using even the vaguest of national security claims. But as I have previously explained, that behavior is often a textbook violation of federal administrative procedure law.”
Germany is set to quadruple its installed solar capacity to 425 gigawatts by 2045, according to a forecast from a trade group representing utilities and grid operators. The projections, Renewables Now reported, mean the country needs to expand its transmission system. Installed onshore wind capacity should triple to around 175 gigawatts by that same year. Battery storage is on track to rise about 68 gigawatts, from roughly 2 gigawatts today. Demand is also set to grow. Data centers, which make up just 2 gigawatts of demand on the grid today, are forecast to balloon to nearly 37 gigawatts in the next 19 years.
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In October, the Chinese Communist Party published the framework of its next Five-Year Plan, the 15th such industrial strategy. The National People’s Congress is set to formally approve the proposal next month. But on Monday, the energy analyst John Kemp called the latest five-word phrase, articulated in the form of “formal input” from the party’s Central Committee, “the most succinct statement of China’s energy policy.” Those words: “Building a strong energy nation.” The suggested edits from the committee described “accelerating the construction of a strong energy nation” as “extremely important and timely” and called its “main shortcomings” the ongoing reliance on imported oil and gas.
Unlike in the U.S., where the Trump administration is working to halt construction of renewables, the officials in Beijing boast that China’s “installed capacity of wind and solar has ranked first in the world for many consecutive years.” Like the U.S., the Central Committee pitched the plan as “an urgent requirement” for “gaining the initiative in great power competition.”
Japan is mounting a new push to implement a decade-old plan to extract rare earths from the ocean floor. A state-owned research vessel just completed a test mission to retrieve an initial sample of mineral-rich mud from a location 20,000 feet below the surface, the South China Morning Post reported. The government of Sanae Takaichi wants to start processing metal-bearing mud from the seabed for tests within a year. “It’s about economic security,” Shoichi Ishii, program director for Japan’s National Platform for Innovative Ocean Developments, told Bloomberg. “The country needs to secure a supply chain of rare earths. However expensive they may be, the industry needs them.”
With global negotiations over a licensing framework for legalizing deep sea mining in international waters has stalled, the U.S. just finalized a rule to speed up American permitting for the nascent sector, clearing the way for Washington to fulfill Trump’s pledge to go it alone if the United Nations’ International Seabed Authority didn’t act first.
A week after signing an historic trade agreement with the European Union, India has inked another deal with the U.S. That means the world’s two largest consumer markets are now wide open to Indian industry, which relies heavily on coal. New Delhi isn’t just going to scrap all those coal-fired factories and forges. But the government’s latest budget earmarks about $2.4 billion over five years to speed up deployment of carbon capture equipment across heavy industry, Carbon Herald reported. The plan focuses on steel, cement, power, refining, and chemicals.