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Climate

2 Climate Removal Deals, 1 Final Tax Credit Rule

On ocean-based CO2, Grizzly 399, and the 45X tax credit.

2 Climate Removal Deals, 1 Final Tax Credit Rule
Heatmap Illustration/Getty Images

Current conditions:Tropical Storm Trami brought widespread flooding to the Philippines, killing at least 24 people • The Southwestern U.S. is experiencing a heatwave, with temperatures as high as 25 degrees Fahrenheit above normal • The three NASA astronauts stuck at the International Space Station due to inclement weather are finally on their way home.

THE TOP FIVE

1. Climeworks 🤝 Morgan Stanley

The Swiss direct air capture company Climeworks has found a new, deep-pocketed partner in Morgan Stanley. The financial services company will pay an undisclosed amount to Climeworks to suck 40,000 tons of CO2 from the air and store the greenhouse gas underground on its behalf. This is the second largest deal Climeworks has secured to date, following an 80,000-ton sale to Boston Consulting Group, and the company says the purchase will help accelerate progress on its first project in the United States, a direct air capture hub in Louisiana called Project Cypress.

2. Microsoft goes big on ocean CDR

Meanwhile, Microsoft is rounding out its already extensive carbon removal portfolio with its first major investment in ocean-based technology. The tech giant agreed to buy up to 350,000 tons of CO2 removal from a startup called Ebb Carbon over the next 10 years, slightly more than its deal with the direct air capture company Heirloom.

Ebb uses electricity to separate seawater into acidic and basic streams, then returns the basic stream back to the ocean, where it reacts with carbon in the water and promotes faster CO2 absorption from the air. The company must achieve and verify an initial 1,300 tons of CO2 removal before Microsoft commits to buying the remainder. The company has a small pilot project up and running at the Pacific Northwest National Laboratory in Washington, and is working with federal scientists and the University of Washington to measure and model the results.

3. The IRA’s X-Factor is in full effect

The Treasury Department issued final rules this morning for the Advanced Manufacturing Production Tax Credit, also known as 45X. The program is the backbone of the Inflation Reduction Act, offering incentives for domestic manufacturing of the components of solar panels, wind turbines, and batteries, subsidizing every step of the supply chain for these technologies. During a call with reporters on Wednesday, Deputy Secretary of the Treasury Wally Adeyemo said the tax credit has already driven more than $126 billion in private sector clean energy manufacturing investments.

The biggest change introduced in the final rule that the administration highlighted was allowing critical mineral extraction — separately and in addition to mineral processing — to qualify for a 10% tax credit. “The U.S. has major deposits of critical minerals like lithium and palladium. Extracting and processing them here in America, as opposed to relying on China, Russia, and other countries with weak worker and environmental protection, is an economic and national security priority for us,” Adeyemo said.

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  • 4. An update on Vineyard Wind

    Engineers at GE Vernova, the manufacturer of the Vineyard Wind offshore turbine blade that crashed into the ocean this summer, have been poring over ultrasound images of its other blades and conducting physical inspections with drones to figure out whether the fiasco was a one-off or a more widespread issue. During an earnings call on Wednesday, CEO Scott Strazik revealed that the company did, in fact, find a similar “manufacturing deviation” in “a very small proportion, low single-digit proportion” of the blades. The company now intends to “remove some blades from the Vineyard Wind farm while strengthening other blades as needed,” according to an update from Vineyard Wind.

    5. Another (potential) nuclear revival

    The 600 megawatt Duane Arnold Energy Center just outside Cedar Rapids, Iowa could be the next shuttered nuclear plant to come back from the dead. The plant’s owner, NextEra, is evaluating a restart, CEO John Ketchum told investors on an earnings call yesterday. “It goes without saying, there’s very strong interest from customers, data-center customers in particular, in that site,” Ketchum said. “We’re in a period of substantial power demand.”

    THE KICKER

    Grizzly 399, the world-renowned, 400-pound bear that roamed Grand Teton National Park for nearly 30 years, died tragically on Tuesday after being hit by a Subaru on the highway. She leaves behind more than a dozen offspring, including a cub born just last year that fans have nicknamed “Spirit.”

    Jonathan Steele/Getty Images

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    Energy

    AM Briefing: Power Hungry

    On the IEAs latest report, flooding in LA, and Bill Gates’ bad news

    Global Electricity Use Is Expected to Soar
    Heatmap Illustration/Getty Images

    Current conditions: Severe thunderstorms tomorrow could spawn tornadoes in Mississippi, Louisiana, Arkansas, and Alabama • A massive wildfire on a biodiverse island in the Indian Ocean has been burning for nearly a month, threatening wildlife • Tropical Cyclone Zelia has made landfall in Western Australia with winds up to 180mph.

    THE TOP FIVE

    1. Breakthrough Energy to slash climate grantmaking budget

    Bill Gates’ climate tech advocacy organization has told its partners that it will slash its grantmaking budget this year, dealing a blow to climate-focused policy and advocacy groups that relied on the Microsoft founder, Heatmap’s Katie Brigham has learned. Breakthrough Energy, the umbrella organization for Gates’ various climate-focused programs, alerted many nonprofit grantees earlier this month that it would not be renewing its support for them. This pullback will not affect Breakthrough’s $3.5 billion climate-focused venture capital arm, Breakthrough Energy Ventures, which funds an extensive portfolio of climate tech companies. Breakthrough’s fellowship program, which provides early-stage climate tech leaders with funding and assistance, will also remain intact, a spokesperson confirmed. They would not comment on whether this change will lead to layoffs at Breakthrough Energy.

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    Climate Tech

    Breakthrough Energy Is Slashing Its Climate Grantmaking Budget

    Grantees told Heatmap they were informed that Bill Gates’ climate funding organization would not renew its support.

    Bill Gates.
    Heatmap Illustration/Getty Images

    Bill Gates’ climate tech advocacy organization has told its partners that it will slash its grantmaking budget this year, dealing a blow to climate-focused policy and advocacy groups that relied on the Microsoft founder, Heatmap has learned.

    Breakthrough Energy, the umbrella organization for Gates’ various climate-focused programs, alerted many nonprofit grantees earlier this month that it would not be renewing its support for them. This pullback will not affect Breakthrough’s $3.5 billion climate-focused venture capital arm, Breakthrough Energy Ventures, which funds an extensive portfolio of climate tech companies. Breakthrough’s fellowship program, which provides early-stage climate tech leaders with funding and assistance, will also remain intact, a spokesperson confirmed. They would not comment on whether this change will lead to layoffs at Breakthrough Energy.

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    Spotlight

    Anti-Wind Activists Have a Big Ask for the Big Man

    The Trump administration is now being lobbied to nix offshore wind projects already under construction.

    Trump and offshore wind.
    Getty Images / Heatmap Illustration

    Anti-wind activists have joined with well-connected figures in conservative legal and energy circles to privately lobby the Trump administration to undo permitting decisions by the National Oceanic and Atmospheric Administration, according to documents obtained by Heatmap.

    Representatives of conservative think tanks and legal nonprofits — including the Caesar Rodney Institute, the Heartland Institute and Committee for a Constructive Tomorrow, or CFACT — sent a letter to Interior Secretary Doug Burgum dated February 11 requesting that the Trump administration “immediately revoke” letters from NOAA to 11 offshore wind projects authorizing “incidental takes,” a term of regulatory art referencing accidental and permissible harassment, injury, or potential deaths under federal endangered species and mammal protection laws. The letter lays out a number of perceived issues with how those approvals have historically been issued for offshore wind companies and claims the government has improperly analyzed the cumulative effects of adding offshore wind to the ocean’s existing industrialization. NOAA oversees marine species protection.

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