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America’s energy regulators are hashing it out in the comments.
As decades of administrative law were being rendered irrelevant last week by a landmark Supreme Court decision denying regulators deference in their interpretations of ambiguous legal statues, one such regulator, Mark Christie, already had some ideas about what do with this new development.
Christie, the Federal Energy Regulatory Commission’s sole Republican member, had taken issue with FERC Order No. 1920, which was unveiled in May and established a new set of rules requiring transmission planners to be more proactive in assessing their future needs and how to pay for them. The order was decided in a 2-1 vote along partisan lines and was largely hailed by environmental and climate groups, who saw it as a way to encourage building out the transmission necessary to bring more wind and solar onto the grid.
To some conservatives, however, the order would remove states from their rightful role in the transmission planning process and stick ratepayers with the cost of infrastructure they never asked for. The rule is already being challenged by state utility commissions, Republican state attorneys general, and the country’s largest regional transmission organization in a FERC process known as request for rehearing. Lawsuits will almost certainly follow.
Those lawsuits will play out on the new terrain laid out by Loper Bright Enterprises v. Raimondo, the Supreme Court decision rendered last week, which overturned a decades-old legal principle known as Chevron deference. Named for the 1984 case Chevron v. Natural Resources Defense Council, which established the notion that courts should defer to agencies’ interpretation of ambiguous statutory language to justify their rulemaking activity, Chevron deference formed the legal foundation for much of the U.S. regulatory apparatus.
In Christie’s lengthy and impassioned dissent to the order, however, he signaled that he thought that foundation might be crumbling.
“The final rule does not deserve a shred of deference under Chevron,” Christie wrote. Unlike past transmission planning rules that had survived legal challenge, this new order was “pretextual” and “heavy handed.” An earlier transmission case case that reached the Washington, D.C. Court of Appeals in 2014, South Carolina Public Service Authority v. FERC, upholding FERC’s ability to mandate transmission planning was, Christie wrote, decided in favor of FERC because it “upheld precisely because it was only mandating processes, not outcomes,” whereas the new rule “nakedly intends to produce very specific outcomes.” Christie was basically painting a red flag on the order for the bull of the judicial process to run through.
Once Chevron deference was no longer in force, Christie issued an update to that dissent, writing in a statement on Friday that the “most important legal lifeline that Order No. 1920 needed was pulled away today, and the final rule’s chances of surviving court challenges just shrank to slim to none.” He referred to outstanding petitions for rehearing the order as “devastating takedowns.” Without Chevron to lean on, he prognosticated, “the Commission can wait for a court to strike down” 1920, or it can answer “those many petitions asking for rehearing or amendments with a new opportunity for amendments.”
In other words, the order should not have had Chevron’s protection, but now that it doesn’t, it’s toast.
On Monday, the Commission’s Democratic Chairman Willie Phillips released a statement (because there was nothing else going on in the legal world that day) arguing that the Commission’s ability to regulate both planning and the distribution of costs “has long been recognized by bipartisan majorities of the Commission and U.S. Court of Appeals for the District of Columbia Circuit,” adding that “nothing in the Supreme Court’s Loper Bright decision overturning the Chevron doctrine calls that conclusion into question.”
He also gave a preview of how the Commission will likely defend the rule in federal court. Order No. 1920 “fits easily within the South Carolina precedent,” he wrote. “It does not promote particular public policies, does not dictate specific outcomes, does not include any selection mandate whatsoever, and employs only the lightest touch possible on cost allocation by simply restating the well-established cost causation principle.”
In conclusion, according to Phillips, Christie’s statement “does not provide a logical or reasonable basis for calling into question whether we have that authority in the first place.”
“It’s not every day that two FERC commissioners just decide to release their thoughts on the latest Supreme Court case,” Ari Peskoe, the director of the Electricity Law Initiative at Harvard Law School, told me.
FERC’s likely argument rests on two legal pillars. The first is that FERC gets its authority from the Federal Power Act, which calls for utility rates to be “just and reasonable” and not “unduly discriminatory or preferential.” FERC has argued that this gives it power over practices that directly affect rates, including transmission planning, which the D.C. Circuit affirmed in South Carolina.
In a separate 2016 case, the Supreme Court ruled that FERC could make rules on practices that directly affect wholesale electricity rates but not retail sales. This case did not depend on Chevron, with Justice Elena Kagan writing in her opinion that the justices “think FERC’s authority clear.” The combined D.C. and Supreme Court precedent, Peskoe said, adds up to FERC having “authority when something directly affects rates."
But in this new legal environment, these precedents may not be enough for a fresh case against FERC's transmission planning authority.
“What does happen now? Who knows,” University of Richmond law professor Joel Eisen told me. “What you would expect now is for litigants to say that any major FERC order, including this one, is inconsistent with the statutory authority that the agency has. They would cite Loper Bright to say that the court has to make an independent judgment that FERC has interpreted law to grant authority to do sweeping change to transmission planning, and that is simply no longer the case,” Eisen said.
Much of FERC’s more than 1,300-page order is devoted to detailed analysis of the electricity market as it stands now and how it will evolve over time, justifying the new transmission planning rules. It’s this record, Eisen said, that might let the order survive in a post-Chevron world, even when FERC asserting that the Federal Power Act gives it the right to set rules may be insufficient on its own.
“That may not have been done as an explicit nod to whether a court might uphold it under Chevron going forward. “It seems to me at least that in this new landscape, what will matter is the robustness of the agency grounded in its expertise,” Eisen told me. “The voluminous record supporting 1920 may be persuasive to a federal court.”
But, as Eisen and Peskoe both warned, which federal court may be as important — if not more so — than any argument FERC makes.
Will FERC's arguments about the nature of the electricity market and precedents relating to interpretation of the Federal Power Act fly in, say, a Texas federal court in the Fifth Circuit, where state utility commissions or Republican attorneys general may file suit? District and appeals court judges in the Fifth Circuit have shown great eagerness to throw out Biden-era rules, with a federal judge in Louisiana only this week blocking the Biden administration’s pause on approving new natural gas export terminals.
“If it goes to the Fifth Circuit,” Peskoe said, “that will be bad news.”
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The birthplace of electricity has more recently been known more for smokestacks and traffic jams than world-changing energy breakthroughs. But that could be about to change.
Why New Jersey? I’ll admit, that’s what I was wondering as my S.U.V. took a Sopranos-adjacent route from midtown Manhattan to an industrial park in Kearny, the Newark suburb bounded by the Passaic River to the west and a landfill to the east, where the holy grail of energy may soon be forged.
I was visiting the nuclear fusion company Thea Energy, which is in the process of designing a stellarator, a kind of torqued donut — French crullers were mentioned several times by Thea cofounder and chief executive Brian Berzin during my time there — that, with the help of 450 magnets and about 15 megawatts of power, could one day hold plasma in place, thereby creating the conditions for the same nuclear reaction that powers the stars to happen here on Earth.
The New Jersey facility was, to my eyes, part tech startup and part laboratory, with rows of desks in an open office and then, once the requisite eye-safety equipment was applied, a laboratory and small-scale manufacturing site.
There were workers winding high-temperature superconductor tape using what can only be described as an oversized VCR-like device named “Zeus” (Greek mythology is the company’s primary motif; the eventual fusion device will be called “Eos,” the goddess of dawn, while Thea is the goddess of light) to make the magnets that could one day make up the stellarator.
We walked past a precision cutting device known as a CNC machine for milling parts on site. Berzin was particularly proud of Thea’s ability to quickly iterate this part of the manufacturing process. A year ago, “when we wanted a new piece of stainless steel in that very specific configuration, we sent out engineering drawings to a third party — sometimes in the United States, sometimes abroad — for them to mill that piece of metal.”
That process “takes a couple of weeks, and then they send it back to you. Sometimes it’s not perfect — you have to get rid of a burr. The quality control is all over the place.” By milling on-site, Thea engineers can make parts and components faster and figure out more quickly what they actually need.
The last stop on the tour was the Canis, a kind of aluminum gougère held up by spindly legs that contained within it an array of nine magnets, with each magnet connected to 50 sensors that could dynamically control and adjust for any errors or misalignments in the magnetic fields. These mass-manufactured magnets could eventually allow the stellarator to be something more like a standard off-the-line product than a finnicky, boutique, one-of-a-kind science project that can only be installed and monitored by plasma physics PhDs.
“We can use very basic manufacturing technologies,” Berzin said. “Here we’re sitting in New Jersey right now. Things are built by local trade laborers, unionized laborers. As much as I love PhDs, power plants are not built by people that have PhDs from MIT or Harvard.”
The facility had a well-worn aura of frugality, a virtue rarely associated with fusion research, which is famous for international consortia taking decades and billions of dollars to come up with working devices, if they ever do. Last year, the team behind the ITER fusion reactor, whose history stretches back to 1985, announced that operation would be delayed until the mid-2030s, a nine-year setback that will likely tack on another €5 billion (around $5.8 billion) to the total cost of over €20 billion.
By contrast, Berzin told me, “when investors and stakeholders come to visit our labs, the one reaction that occurs frequently is, Wow, you’ve done all of this with only $20 million?”
Thea’s primary competitors in the booming private fusion industry, which has attracted over $7 billion in private investment globally, can be found outside Boston, where Commonwealth Fusion Systems spun out of the Massachusetts Institute of Technology, or north of Seattle, where Sam Altman-backed Helion is located, well known centers of scientific research and technology businesses.
Some of these competitors are incredibly well funded, especially CFS, which has raised around $2 billion — a substantial portion of all money raised by fusion companies everywhere.
Thea, by contrast, has raised around $30 million all told, with $20 million coming in a Series A backed by Prelude Ventures, Lowercarbon Capital, and other venture investors.
Berzin attributed this cost efficiency in part to the company’s heavy use of software in design and operations, which is a “more scalable, more cost-efficient thing,” he told me. “We’ve been able to go very far with our Series A compared to our peers,” which he credits to a “pretty gritty mindset.”
And yet still I wondered: Why North Jersey, an area better known for turnpikes, swamps, and pharmaceutical companies? “New York, New Jersey, the greater New York City area, I think notoriously within the investor-VC-tech community, is seen as being behind the ball,” Berzin said.
“I'm really proud to be here in the tri-state area. You have some great industries, people move to New York City to be in the center of the universe for one of many fields, and that has been something we've been able to leverage. All these different skill-sets and engineering talent pools weren't necessarily in fusion before,” Berzin said. “Control systems, optimization, manufacturing — these people exist within the New York City area.”
Northern New Jersey itself is something of an energy crossroads. It lies between two centers of fusion research — the Princeton Plasma Physics Laboratory, where the stellarator was first dreamed up and from which Thea itself was spun out, and Columbia University, which has its own fusion and plasma physics research programs.
Northern New Jersey is also centrally located within PJM Interconnection, the United States’s largest electricity market. Northern New Jersey is also centrally located within PJM Interconnection, the United States’s largest electricity market. While there isn’t yet a site for Thea to actually install their system in a power plant, executives did point to brownfield sites such as a decommissioned coal plant in Jersey City, which already has interconnection with the grid.
Not for nothing, New Jersey has been a center for electricity innovation for just about as long as there’s been a commercial market for electricity. Thomas Edison’s Menlo Park lab was located about 20 miles south of Thea. The company’s co-founder David Gates is a winner of the Edison Patent Award for the stellarator work at the Princeton lab.
Plus, “I live in New York City,” Berzin added. “It’s the center of the universe.”
If you can make fusion happen here — or at least across the Hudson from here — you might be able to make it happen anywhere.
The widely circulating document lists more than 68 activities newly subject to upper-level review.
The federal government is poised to put solar and wind projects through strict new reviews that may delay projects across the country, according to a widely circulating document reviewed by Heatmap.
The secretarial order authored by Interior Secretary Doug Burgum’s Deputy Chief of Staff for Policy Gregory Wischer is dated July 15 and states that “all decisions, actions, consultations, and other undertakings” that are “related to wind and solar energy facilities” will now be required to go through multiple layers of political review from Burgum’s office and Interior’s Office of the Deputy Secretary.
This new layer of review would span essentially anything Interior and its many subagencies would ordinarily be consulted on before construction on a project can commence — a milestone crucial for being able to qualify for federal renewable energy tax credits under the One Big Beautiful Bill Act. The order lists more than 68 different activities newly subject to higher-level review, including some basic determinations as to whether projects conform with federal environmental and conservation laws, as well as consultations on compliance with wildlife protection laws such as the Endangered Species Act. The final item in the list sweeps “any other similar or related decisions, actions, consultations, or undertakings” under the order’s purview, in case there was any grey area there.
In other words, this order is so drastic it would impact projects on state and private lands, as well as federal acreage. In some cases, agency staff may now need political sign-offs simply to tell renewables developers whether they need a permit at all.
“This is the way you stall and kill projects. Intentionally red-tape projects to death,” former Biden White House clean energy adviser Avi Zevin wrote on Bluesky in a post with a screenshot of the order.
The department has yet to release the document and it’s unclear whether or when it will be made public. The order’s existence was first reported by Politico; in a statement to that news outlet, the department did not deny the document’s existence but attacked leakers. “Let’s be clear: leaking internal documents to the media is cowardly, dishonest, and a blatant violation of professional standards,” the statement said.
Interior’s press office did not immediately respond to a request for comment from Heatmap about when this document may be made public. We also asked whether this would also apply to transmission connected to solar and wind. You had better believe I’ll be following up with the department to find out, and we’ll update this story if we hear back from them.
Two former Microsoft employees have turned their frustration into an awareness campaign to hold tech companies accountable.
When the clean energy world considers the consequences of the artificial intelligence boom, rising data center electricity demand and the strain it’s putting on the grid is typically top of mind — even if that’s weighed against the litany of potential positive impacts, which includes improved weather forecasting, grid optimization, wildfire risk mitigation, critical minerals discovery, and geothermal development.
I’ve written about a bunch of it. But the not-so-secret flip side is that naturally, any AI-fueled improvements in efficiency, data analytics, and predictive capabilities will benefit well-capitalized fossil fuel giants just as much — if not significantly more — than plucky climate tech startups or cash-strapped utilities.
“The narrative is a net impact equation that only includes the positive use cases of AI as compared to the operational impacts, which we believe is apples to oranges,” Holly Alpine, co-founder of the Enabled Emissions Campaign, told me. “We need to expand that conversation and include the negative applications in that scoreboard.”
Alpine founded the campaign alongside her partner, Will Alpine, in February of last year, with the goal of holding tech giants accountable for the ways users leverage their products to accelerate fossil fuel production. Both formerly worked for Microsoft on sustainability initiatives related to data centers and AI, but quit after what they told me amounted to a string of unfulfilled promises by the company and a realization that internal pressure alone couldn’t move the needle as far as they’d hoped.
While at Microsoft, they were dismayed to learn that the company had contracts for its cloud services and suite of AI tools with some of the largest fossil fuel corporations in the world — including ExxonMobil, Chevron, and Shell — and that the partnerships were formed with the explicit intent to expand oil and gas production. Other hyperscalers such as Google and Amazon have also formed similar cloud and AI service partnerships with oil and gas giants, though Google burnished its sustainability bona fides in 2020 by announcing that it would no longer build custom AI tools for the fossil fuel industry. (In response to my request for comment, Microsoft directed me to its energy principles, which were written in 2022, while the Alpines were still with the company, and to its 2025 sustainability report. Neither addresses the Alpines’ concerns directly, which is perhaps telling in its own right.)
AI can help fossil fuel companies accelerate and expand fossil fuel production throughout all stages of the process, from exploration and reservoir modeling to predictive maintenance, transport and logistics optimization, demand forecasting, and revenue modeling. And while partnerships with AI hyperscalers can be extremely beneficial, oil and gas companies are also building out their own AI-focused teams and capabilities in-house.
“As a lot of the low-hanging fruit in the oil reserve space has been plucked, companies have been increasingly relying on things like fracking and offshore drilling to stay competitive,” Will told me. “So using AI is now allowing those operations to continue in a way that they previously could not.”
Exxon, for example, boasts on its website that it’s “the first in our industry to leverage autonomous drilling in deep water,” thanks to its AI-powered systems that can determine drilling parameters and control the whole process sans human intervention. Likewise, BP notes that its "Optimization Genie” AI tool has helped it increase production by about 2,000 oil-equivalent barrels per day in the Gulf of Mexico, and that between 2022 and 2024, AI and advanced analytics allowed the company to increase production by 4% overall.
In general, however, the degree to which AI-enabled systems help expand production is not something companies speak about publicly. For instance, when Microsoft inked a contract with Exxon six years ago, it predicted that its suite of digital products would enable the oil giant to grow production in the Permian Basin by up to 50,000 barrels by 2025. And while output in the Permian has boomed, it’s unclear how much Microsoft is to thank for that as neither company has released any figures.
Either way, many of the climate impacts of using AI for oil and gas production are likely to go unquantified. That’s because the so-called “enabled emissions” from the tech sector are not captured by the standard emissions accounting framework, which categorizes direct emissions from a company’s operations as scope 1, indirect emissions from the generation of purchased energy as scope 2, and all other emissions across the value chain as scope 3. So while tailpipe emissions, for example, would fall into Exxon’s scope 3 bucket — thus requiring disclosure — they’re outside Microsoft’s reporting boundaries.
According to the Alpines’ calculations, though, Microsoft’s deal with Exxon plus another contract with Chevron totalled “over 300% of Microsoft’s entire carbon footprint, including data centers.” So it’s really no surprise that hyperscalers have largely fallen silent when it comes to citing specific numbers, given the history of employee blowback and media furor over the friction between tech companies’ sustainability targets and their fossil fuel contracts.
As such, the tech industry often ends up wrapping these deals in broad language highlighting operational efficiency, digital transformation, and even sustainability benefits —- think waste reduction and decreasing methane leakage rates — while glossing over the fact that at their core, these partnerships are primarily designed to increase oil and gas output.
While none of the fossil fuel companies I contacted — Chevron, Exxon, Shell, and BP — replied to my inquiries about the ways they’re leveraging AI, earnings calls and published corporate materials make it clear that the industry is ready to utilize the technology to its fullest extent.
“We’re looking to leverage knowledge in a different way than we have in the past,” Shell CEO Wael Sawan said on the company’s Q2 earnings call last year, citing AI as one of the tools that he sees as integral to “transform the culture of the company to one that is able to outcompete in the coming years.”
Shell has partnered since 2018 with the enterprise software company C3.ai on AI applications such as predictive maintenance, equipment monitoring, and asset optimization, the latter of which has helped the company increase liquid natural gas production by 1% to 2%. C3.ai CEO Tom Siebel was vague on the company’s 2025 Q1 earnings call, but said that Shell estimates that the partnership has “generated annual benefit to Shell of $2 billion.”
In terms of AI’s ability to get more oil and gas out of the ground, “it’s like getting a Kuwait online,” Rakesh Jaggi, who leads the digital efforts at the oil-services giant SLB, told Barron’s magazine. Kuwait is the third largest crude oil producer in OPEC, producing about 2.9 million barrels per day.
Some oil and gas giants were initially reluctant to get fully aboard the AI hype train — even Exxon CEO Darren Woods noted on the company’s 2024 Q3 earnings call that the oil giant doesn’t “like jumping on bandwagons.” Yet he still sees “good potential” for AI to be a “part of the equation” when it comes to the company’s ambition to slash $15 billion in costs by 2027.
Chevron is similarly looking to AI to cut costs. As the company’s Chief Financial Officer Eimear Bonner explained during its 2024 Q4 earnings call, AI could help Chevron save $2 to $3 billion over the next few years as the company looks towards “using technology to do work completely differently.” Meanwhile, Saudi Aramco’s CEO Amin Nasser told Bloomberg that AI is a core reason it’s been able to keep production costs at $3 per barrel for the past 20 years, despite inflation and other headwinds in the sector.
Of course, it should come as no surprise that fossil fuel companies are taking advantage of the vast opportunities that AI provides. After all, the investors and shareholders these companies are ultimately beholden to would likely revolt if they thought their fiduciaries had failed to capitalize on such an enormous technological breakthrough.
The Alpines are well aware that this is the world we live in, and that we’re not going to overthrow capitalism anytime soon. Right now, they told me they’re primarily running a two-person “awareness campaign,” as the general public and sometimes even former colleagues are largely in the dark when it comes to how AI is being used to boost oil and gas production. While Will said they’re “staying small and lean” for now while they fundraise, the campaign has support from a number of allies including the consumer rights group Public Citizen, the tech worker group Amazon Employees for Climate Justice, and the NGO Friends of the Earth.
In the medium term, they’re looking toward policy shifts that would require more disclosure and regulation around AI’s potential for harm in the energy sector. “The only way we believe to really achieve deep change is to raise the floor at an international or national policy level,” Will told me. As an example, he pointed to the EU’s comprehensive regulations that categorize AI use cases by risk level, which then determines the rules these systems are subject to. Police use of facial recognition is considered high risk, for example, while AI spam filters are low risk. Right now, energy sector applications are not categorized as risky at all.
“What we would advocate for would be that AI use in the energy sector falls under a high risk classification system due to its risk for human harm. And then it would go through a governance process, ideally that would align with climate science targets,” Will told me. “So you could use that to uplift positive applications like AI for methane leak detection, but AI for upstream scenarios should be subject to additional scrutiny.”
And realistically, there’s no chance of something like this being implemented in the U.S. under Trump, let alone somewhere like Saudi Arabia. And even if such regulations were eventually enacted in some countries, energy markets are global, meaning governments around the world would ultimately need to align on risk mitigation strategies for reigning in AI’s potential for climate harm.
As Will told me, “that would be a massive uphill battle, but we think it’s one that’s worth fighting.”