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Anu Khan is pushing carbon credits to better serve the public good.
There’s a new player in carbon removal. It’s not another startup building machines to suck carbon from the air. And it’s not another trade association or consulting firm or marketplace peddling carbon removal credits. Instead, it wants to help establish a different system for advancing carbon removal — one where the challenging but important goal of scrubbing CO2 from the atmosphere is treated as a public good and not just a business opportunity.
It’s called the Carbon Removal Standards Initiative, and it’s run by Anu Khan, the former deputy director of science and innovation at Carbon180. CRSI (pronounced like the Lannister queen in Game of Thrones, “Cersei”) is a “financially unconflicted, independent nonprofit,” that will provide technical assistance to policymakers, regulators, and nongovernmental organizations in quantifying carbon removal outcomes.
A group providing technical assistance may not sound like a revolutionary development. But Khan hopes CRSI will be a fulcrum around which the entire industry can begin to pivot.
Today’s carbon removal industry is built on selling credits, each of which is supposed to represent one ton of CO2 pulled out of the atmosphere. But the market is almost entirely self-regulated. The standards for measuring and reporting how much carbon a given project is removing have either been developed by the carbon credit registries that take a cut of the sales or by the developers themselves — in both cases a conflict of interest, even if governed by the best of intentions. Plus, there’s a multitude of standards for every type of project, and they vary in quality.
Take carbon farming, for example. If a farmer alters their practices to increase the carbon stored in their soil, they can choose from more than a dozen standards to quantify the effects. In theory, the standards all produce an identical product — a fungible carbon credit equivalent to one ton of carbon removed from the atmosphere. In reality, they vary widely in quality, with some standards producing more accurate results than others.
In watching this environment develop over the past several years, I’ve often wondered if some independent, unbiased entity might eventually step forward to enact one set of standards to rule them all. Khan told me that about a year and a half ago, she had the same thought. “Oh, to be so young,” she said.
At the time, there was growing concern that the carbon removal industry would suffer from the same credibility issues that plagued the wider market for carbon credits. “You have a multiplicity of these verification entities driven by profit motives, some of which have very loose standards,” Wil Burns, the co-executive director of the Institute for Carbon Removal Law and Policy at American University, told me. “From the standpoint of those purchasing credits or those viewing whether companies are doing anything meaningful, nobody can really distinguish.”
In early 2023, dozens of carbon removal suppliers, buyers, verifiers, academics, and nonprofit staff — including Khan — signed an open letter that now reads like an early draft of CRSI’s missions statement. It called for the creation of “an independent, not-for-profit initiative that conscientiously avoids conflicts of interest and has funding that does not depend on issuing or selling carbon credits.” This new body would “provide a trusted, scientific stamp of approval for CDR protocols through an inclusive process to identify scientific consensus.”
The letter focused on the issues with measuring carbon removal in the context of the voluntary sale of carbon credits. But over the next year, it became clear to Khan that carbon removal won’t reach the scale necessary to make a dent in climate change without government policy. “Even the market enthusiasts recognize that we’re going to need policy as quickly as possible to shore this up,” she said, “and it’s going to be policy, long term, that gets us to gigaton scale.”
So instead of providing “a trusted, scientific stamp of approval” to private businesses, CRSI is laser focused on working with policymakers. It’s not entirely clear yet what that will look like, and it’s likely to evolve as CRSI finds its footing. But the group is launching with a few projects that are already underway. It has created a database of “quantification resources,” which is basically a list of all of the methodologies published by companies, academics, government agencies, and international standards organizations, for measuring different kinds of carbon removal. It also has a database of carbon removal policies, both those enacted and proposed. Eventually, Khan plans to have them link out to each other, so you can see which standards underpin which policies.
Khan wants CRSI to be a go-to resource for policymakers and agency staff to ensure that carbon removal programs actually result in climate benefits. “We are fundamentally a mission organization,” she told me. “We believe that carbon removal is a tool for climate justice. Justice requires accountability, and in carbon removal, that means knowing how to count the carbon. We want to make sure that if we're putting public dollars into these policies, that they are backed by the ability to actually measure the carbon.”
Khan isn’t the only one whose thinking on standards has shifted toward a government-led approach. Burns, who also signed the letter, told me he’s seeing more carbon removal companies pushing for a compliance market, where the government requires polluting businesses to buy carbon removal. “They would like to both have government standards that would provide more confidence, for example, to investors,” he said, “and they would like government mandates that generate more demand.”
Freya Chay is the program lead at the nonprofit Carbon Plan, which spearheaded the letter. She told me many in the industry are now thinking about carbon removal programs that don’t revolve around selling credits at all, and therefore may have very different measurement and verification needs.
One of CRSI’s first projects is an illustrative example. Imagine if the Department of Agriculture developed a program to help farmers restore the pH of soils that have gotten too acidic, by adding basalt — a mineral that also happens to capture CO2 from the atmosphere as it dissolves. Today, carbon removal companies that sell carbon credits based on this process are taking hundreds of soil samples to measure the outcomes. The USDA likely wouldn’t need that level of precision — the captured CO2 is a co-benefit, not the entire point of the program — but “at some point you probably do want to know if you removed carbon through this policy,” said Khan. CRSI is working on figuring out how you would do that.
Similarly, we might see the development of building codes that encourage the use of concrete cured with CO2 from the atmosphere, or waste management regulations that govern the injection of carbon-rich organic waste into underground storage wells. Bigger picture, the U.S. will eventually have to measure and report how much carbon removal it’s doing across all of these little programs as part of its obligation under the Paris Agreement.
In many of these cases, those setting the rules won’t be experts in carbon removal science. “They’re going to need technical expertise,” said Khan. “We want to make sure that when they are doing that work, they have access to all of the relevant information, and that it’s organized in a way that’s legible for the expertise that they already have.”
Shuchi Talati, the former chief of staff in the office of fossil energy and carbon management at the Department of Energy, told me that having this kind of centralized resource would definitely have been useful. “The private sector has a lot of power right now in setting standards because the public sector doesn’t have the capacity,” she said. And since the field is so diverse, efforts are spread across a bunch of different agencies that don’t always talk to each other. Talati sits on the board of CRSI, and for her, the focus on government is not just about helping carbon removal scale.
“If we’re allowing the private sector to set standards and norms — and maybe they’re fine right now — but if we continue to let that happen, I can see the actual climate benefit of CDR slipping away,” Talati said. “That’s really where I see Anu’s organization fit in, where we are trying to set standards and norms from this core, foundational principle of a public good.”
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How the perpetually almost-there technology could get shut out of the Inflation Reduction Act’s surviving nuclear tax credits.
The House offered a last minute olive branch to the increasingly bipartisan nuclear industry when it passed its version of the budget reconciliation bill now working its way through the Senate, opting to preserve tax credit eligibility for so-called “advanced nuclear facilities” that start construction by 2029. That deadline will be difficult for many nuclear companies to meet, regardless of their technological approach or reactor size. But one much anticipated, potentially world-changing technology won’t even have a shot: nuclear fusion.
That’s not because fusion is so futuristic that the 2029 deadline would be categorically unworkable. As I keep hearing, the tech is finally, possibly, actually on the verge of commercialization, and some industry leaders such as Commonwealth Fusion Systems could probably break ground on a commercial reactor by then.
Fusion won’t have a shot simply because, as defined by Congress and the IRS, it does not fall within the category of an “advanced nuclear facility.” Instead, it’s defined and regulated as a separate class of zero-emission technology, thus excluding it from the nuclear carve out in the budget bill. That distinction was made clear in January, when the IRS released its final regulations for the Inflation Reduction Act, Julien Barber, an investor in multiple fusion technologies at Emerson Collective, told me. That separation happened because “we wanted to regulate them differently,” he said.
Fusion reactors can’t melt down and don’t produce the kind of highly radioactive nuclear waste that fission does, meaning that many of the safety constraints on conventional nuclear don’t apply to fusion. In 2023, the Nuclear Regulatory Commission decided to regulate fusion reactors more like particle accelerators, which are typically licensed at the state level, have fewer siting constraints, less stringent security requirements, and are often exempt from full environmental review. Last year, a bipartisan group of senators worked together to pass the Fusion Energy Act, which confirmed the NRC’s decision to separate the regulatory processes.
If the Senate approves the House’s version of the clean energy investment and production tax credits, fusion energy will be subject to the same tight restrictions as other clean energy solutions. The timeline for credit eligibility requires energy projects to begin construction a mere 60 days after the bill’s passage, and be placed in service by 2029. That, Barber said, is “essentially impossible for any of the fusion companies out there.” Brian Berzin, CEO of the fusion startup Thea Energy, agreed. “Most private fusion companies will be left unable to benefit from these financial incentives,” he wrote in an emailed statement.
There’s confusion, however, around whether this fusion exclusion was a deliberate decision from the House or simply an oversight. Barber is betting on the latter.
“This was happening quickly,” Barber told me. “There was some push by some of the companies in the [Fusion Industry Association] to review the language, but they just didn’t have time to review the language in time to write comments, and it just kind of got pushed through as is.”
The bill’s final language also took the CEO of the Fusion Industry Association, Andrew Holland, by surprise. “We had heard that fusion would be part of the carve out too, but then it wasn’t,” Holland told me.
A more pessimistic interpretation is also possible, Barber conceded. “There’s the idea that people don’t think fusion is ever going to be the case,” he told me. Certainly for some both in and out of government, fusion represents a dream perpetually deferred.
What Barber thinks many people fail to realize, though, is that some fusion industry leaders are operating on timelines similar to fission companies building small modular reactors. “If you talk to CFS, they’re going to say, We’re going to be putting our first power plant on the grid by the early 2030s, which is the same timeline as [small modular reactor company] X-energy, right?”
Until this moment, the distinction that top governing bodies such as the Nuclear Regulatory Commission have made between fusion and fission has been nothing but a positive for fusion companies and advocates alike. When the Fusion Energy Act passed, one of the bill’s co-sponsors, Republican John Cornyn of Texas, said that “fusion energy is a promising clean and safe power source that could help address America’s growing energy demands.” Another co-sponser, Republican Todd Young of Indiana, said that fusion “has the potential to usher in a new era of energy production in America.”
But whether generalized Republican support for fusion will extend beyond easing regulations to actively include subsidies for the technology remains to be seen. And for now, most of the companies themselves are staying quiet. As of publication time, CFS, Zap Energy, Type One Energy, and Xcimer Energy all either said they could not comment or else did not respond to my request for comment.
Editor’s note: This story has been updated to include comments from the Fusion Industry Association.
Regardless of who’s eligible for what and when, strict “foreign entity of concern” provisions could make clean energy incentives impossible to take advantage of.
The word of the moment in renewable energy is “unworkable.” That’s how the chief executives of two major renewables developers — John Ketchum of NextEra and Jim Murphy of Invenergy — described new requirements inserted into clean energy tax credits by congressional Republicans in recent weeks.
“The way they’re drafted, they’re unworkable,” Ketchum said of the requirements at a Politico summit held earlier this week. He was referring specifically to a new set of provisions in the House budget reconciliation bill which say that to qualify for the credits, companies must divest their supply chains from “foreign entities of concern,” a group of countries comprising Russia, Iran, North Korea, and China. But really, the rules are about China.
Around 80% of the global solar panel supply chain runs through China, according to the International Energy Agency. The batteries used in many stationary storage systems are almost entirely made in China, to name just a couple isolated examples. Starting in 2026, the bill mandates that developers seeking to claim the clean energy production or investment tax credits may not receive “material assistance” from China. That refers to any component or subcomponent (including critical minerals) that was “extracted, processed, recycled, manufactured, or assembled” by a “prohibited foreign entity,” defined as a company with at least 25% Chinese ownership or 10% Chinese debt holdings, according to a memo by the law firm Norton Rose Fulbright. The rules become even more strict in 2028. Similar strictures were also added to the 45X advanced manufacturing tax credit.
A small modular reactor has at least 10,000 component parts, Ketchum told the Politico audience. “We come to find out that one of the screws in the bolts, used by one of the suppliers five layers down … was actually sourcing the bolt and the screw from China. Guess what happens? You’re disqualified, all your tax credits for that small modular reactor go away,” Ketchum said.
“How in the world are you going to trace five layers down to a subcontractor who’s buying a bolt and a screw?”
Murphy, the Invenergy CEO, put it more succinctly at an industry conference last week. “The supply chain can not support that, and won’t be able to support that for several years. It’s just an unworkable provision.”
While these may sound like the exaggerations of executives eager to avoid paperwork or costly new investments, analysts who have looked at the bill’s language have similarly concluded that the language is both so vague and so broad that determining whether a company has complied would be almost impossible.
Analysts at the investment bank Evercore wrote in a note to clients last week that while the new FEOC framework “ostensibly aims to keep China out of U.S. energy supply chains, it would likely bury companies and their suppliers in such onerous paperwork and diligence that the remaining tax credits are rendered largely unusable.”
Foreign entity of concern rules are not new — versions of them appear in the CHIPS and Science Act and the Inflation Reduction Act’s electric vehicle tax credits. The FEOC rules in the One Big, Beautiful Bill are far more extensive, however.
The Senate may look to loosen the rules, according to Axios, andseveral House Republicans have signed (yet another) letter, this one referring to the restrictions as “highly restrictive and onerous” and “overly prescriptive and risk undermining U.S. competitiveness.”
Should the FEOC provisions become law, their exact implementation will be up to the IRS. In the case of EVs, the tax agency came out with proposed guidelines in the months after the Inflation Reduction Act was enacted, but didn’t finalize them until 2024. Even complying with those required a “Herculean” effort from the EV and battery industry, Albert Gore, head of the Zero Emission Transportation Association, told me.
Gore also questioned whether the rules would be “workable” as written. To determine whether compliance would be worth it, Gore said, you have to evaluate how close an industry is to complying in the present, and the value of complying in the future, and the cost to get there.
Given that the clean energy and manufacturing credits sunset after 2031 (except for wind components, which sunset earlier), that calculation may very well come out negative. And then there’s the deadline to even qualify for the clean energy tax credits in the first place, starting construction two months after the bill passes, according to the House language.
The EV rules did ultimately support U.S. manufacturing, Gore told me. “It was a pretty efficient investment in American manufacturing, kind of disguised as a consumer EV credit,” he said. “But it was a very, very stringent credit.”
Xan Fishman, senior managing director of the energy program at the Bipartisan Policy Center, was skeptical that the FEOC provisions in the budget reconciliation bill would do anything to bolster U.S. manufacturing. “Intricate and complicated doesn’t make it more effective,” he told me.
“You would have a disallowance of credit if you are a foreign entity of concern, or you are a foreign influenced entity of concern, which might mean that one of your suppliers is a foreign entity of concern, or one of your supplier’s board members is from China or they have a family member that’s from China that runs a foreign entity of concern, or that family member has some business transaction involving debt with a foreign entity of concern, and their suppliers actually might have board members who have family members who have some debt arrangement with the foreign entity of concern,” Fishman elaborated.
This is where workability really comes in.
“If the result of this is we have less U.S. manufacturing, we won’t have achieved the goal” of raising America’s global competitiveness. “Nor will we have been tough on China,” Fishman said.
The ironies of the legislation abound. “There's sort of that double whammy in there with the start of construction deadline, which to some extent, makes the FEOC moot,” Murphy, the Invenergy CEO, said at the conference. “If you don't start construction by the deadline, who cares about it?”
Ironically, if the Senate put in a more relaxed deadline to qualify for the credits, “then we have to really address those foreign entity of concern provisions,” Murphy added.
On Trump’s ‘windmill’ ban, FEMA turnover, and PNW power
Current conditions: Physical activity is “discouraged” at the Grand Canyon today as temperatures climb toward 110 degrees Fahrenheit • Tropical Storm Wutip could dump 7 inches of rain in six hours over parts of Vietnam • Investigators are looking into whether this week’s triple-digit heat in Ahmedabad, India, was a factor in Thursday’s deadly plane crash.
Noah Buscher/Unsplash
President Trump said Thursday that his administration is “not going to approve windmills unless something happens that’s an emergency.” The comments — made during the White House East Room signing of legislation overturning California’s authority to set its own car pollution standards — were Trump’s clearest confirmation yet of my colleague Jael Holzman’s reporting, which this week found that “the wind industry’s worst fears are indeed coming to pass.” As Jael went on in The Fight, the Fish and Wildlife Service and the U.S. Army Corps of Engineers have “simply stopped processing wind project permit applications after Trump’s orders — and the freeze appears immovable, unless something changes.”
Trump justified the pause by adding that “we’re not going to let windmills get built because we’re not going to destroy our country any further than it’s already been destroyed,” repeating his long-held grievance that “you go and look at these beautiful plains and valleys, and they’re loaded up with this garbage that gets worse and worse looking with time.” Trump’s aesthetic objections have already blocked at least three wind projects in New York alone — a move that has impacts beyond future energy generation, Jael further notes. According to the Alliance for Clean Energy New York, the policy has impacted “more than $2 billion in capital investments, just in the land-based wind project pipeline, and there’s significant reason to believe other states are also experiencing similar risks.” Read Jael’s full report here.
Turnover at the Federal Emergency Management Agency continued this week after the head of the National Response Coordination Center — responsible for overseeing the federal response to major storms — submitted his resignation, CBS News reported Thursday. Jeremy Greenberg, who’s worked various roles at FEMA for nearly a decade, will stay on for another two weeks but ultimately depart less than a month into hurricane season. “He’s irreplaceable,” one current FEMA official told CBS News, adding that “the brain drain continues and the public will pay for it.” Greenberg’s resignation follows comments President Trump made to the press earlier this week about the need to “wean off of FEMA” after hurricane season is over in November. “A governor should be able to handle” disaster response, the president told reporters on Tuesday, “and frankly, if they can’t handle it, the aftermath, then maybe they shouldn’t be governor.”
Also on Thursday, President Trump issued a presidential memorandum revoking a $1 billion Biden-era agreement to restore salmon and invest in tribally sponsored clean energy infrastructure in the Columbia River Basin, The Seattle Times reports. Biden’s agreement had “placed concerns about climate change above the nation’s interests in reliable energy sources,” the White House claimed.
The 2023 agreement resulted from three decades of opposition to the dams on the Lower Snake River by local tribes and environmental groups. While the Biden administration hadn’t committed to a dam removal, it did present a potential pathway to do so, since Washington State politicians have said that hydropower would need to be replaced by another power source before they’d consider a dam removal plan. The government’s billion-dollar investment would have aided in the construction of up to 3 gigawatts of alternative renewable energy in the region. Kurt Miller, the CEO of the Northwest Public Power Association, celebrated Trump’s action, saying, “In an era of skyrocketing electricity demand, these dams are essential to maintaining grid reliability and keeping energy bills affordable.” But Washington Senator Patty Murray, a Democrat, vowed to fight the “grievously wrong” decision, arguing, “Donald Trump doesn’t know the first thing about the Northwest and our way of life — so of course, he is abruptly and unilaterally upending a historic agreement.”
Two years after we wrote the eulogy for the Chevrolet Bolt EV — “the cheap little EV we need” — General Motors has announced that it will launch the second generation of the car for the 2027 model year. Though “no other details were provided about this next iteration of the Bolt,” Car and Driver wrote that “we expect it to continue as a tall subcompact hatchback, although it could be positioned as a subcompact SUV like the previous generation's EUV model.” A reveal could be coming in the next several months ahead of a likely on-sale date in mid-2026.
Energy developer Scale Microgrids announced Thursday that its latest round of financing, which closed at $275 million, has brought its total to date to over $1 billion. KeyBanc Capital Markets, Cadence Bank, and New York Green Bank led the round, with Greg Berman, the managing director in KeyBanc Capital Markets Utilities, saying in a statement, “We value our relationship with Scale and congratulate their team as they execute on their strategy to deliver high-quality distributed energy assets to the market.” Scale Microgrids said the financing will “support 140 megawatts of distributed generation projects, including microgrids, community-scale solar and storage, and battery storage installations,” many of which are already under construction in the Northeast and California.
“Our best chance is to get a group of critical mass of Republican senators to go to [Senate Majority Leader John] Thune and [Senate Finance Committee Chair Mike] Crapo and say, You’ve got to change this. We can’t vote for it the way it is.” —Democratic Majority Leader Chuck Schumer in conversation with Heatmap’s Robinson Meyer about the Senate math and strategy behind saving the Inflation Reduction Act.