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Americans living downwind of the Canadian fires can breathe a sigh of relief this week, knowing they’re likely safe from a repeat of last week’s
history-making smoke pollution event. But maybe don’t breathe too deeply — where there is fire, there is smoke, and there were still almost 450 active fires burning in Canada on Monday morning.
The good news is, the low-pressure front off the Atlantic Coast that had been responsible for channeling smoke directly at New York City, Boston, and Washington, D.C., has weakened and broken up, meaning “the winds are fanning out in more directions, spreading the smoke across a wider area,” Bloomberg reports. The smoke from Canada now stretches as far east as Western Europe and Norway, but pollutant concentrations are low enough that most people aren’t in danger.
Still, if you’re planning on a big gardening project or a long run, earlier in the week will be better since some signs point to the potential for smoky air to return as we approach the weekend.
Here’s how things are stacking up across the country:
The AQI hovered around 100 on Monday morning in New York City — just a tick away from being considered unhealthy for sensitive groups. But the rain forecast for the city is expected to help clear up some of the lingering pollution via a process called “coagulation,” when water droplets essentially wash out pollutants from the air.
The bad news is, “in order to extensively clean out the air currently over our region, we would need a major rainstorm, such as a tropical storm or nor’easter,” CBS News New York reports, noting that none are in our immediate forecast. Additionally, the pollution-clearing “bad weather” will likely be localized on Monday, meaning some areas will get flushed out better than others. There is even a chance that the stormy weather back East could actually fan the flames in Canada and eventually send more smoke back toward the States, AccuWeather’s meteorologists predicted.
Based on models at the time of publication, New York will remain under smoke through Tuesday morning, with the chance of some lingering smoke returning in low quantities on Wednesday morning. Much will depend on how much smoke is produced in the weeks — and possibly months — ahead, with some U.S. leaders turning their attention toward stopping the problem at the source.
\u201cThis is a crisis for both our countries. I\u2019m calling on @SecVilsack to double the number Forest Service personnel deployed to Canada to\u00a0help\u00a0fight the\u00a0wildfires and prevent a summer of smoke in New York and the Northeast.\u201d— Chuck Schumer (@Chuck Schumer) 1686522127
New York state remained under a cover of smoke going into Monday, although AQI warnings were mostly in a “moderate” under-100 range. Rain upstate though is expected to clear the air quality and hopefully help mitigate the local risk of more fires starting. Buffalo has gone 22 days without measurable rainfall, “a tie for the 10th longest stretch without measurable rainfall since rainfall records started back in 1874,” ABC News’ local affiliate reports. If Canada gets the rain, too, it could help slow or put out some of the fires, leading to reduced smoke downwind in the States.
By mid-week, meteorologists forecast a new low-pressure system might form that could pull smoke back down over western New York, though it’s doubtful it will be as bad as it was last week.
New England was mostly spared the smoke during last week’s crisis due to the low-pressure zone that directed bad air around it. Because that system has now broken up, New England joins the rest of the East Coast this week under a hazy sun.
\u201cExpect smoke this week in New England, & dipping down into the Northern Plains. Canadian provinces will continue to battle with fires and wildfire smoke through the week. Isolated to scattered storms are expected from the deep south to the Mid-Atlantic. https://t.co/MqqaWfukmv\u201d— Andrew Revering (@Andrew Revering) 1686563864
In particular, the National Weather Service warns that there will be “degraded air quality” on Monday evening due to the winds blowing smoke back into the area.
\u201cYou may have noticed it looks a little hazy outside. It has taken a bit of a detour, but some near surface smoke is working its way back into the region, which will result in slightly degraded air quality this evening. Can you spot the incoming front based on the smoke forecast?\u201d— NWS Burlington (@NWS Burlington) 1686579093
The worst air quality in Washington, D.C., in any given year is usually on the Fourth of July ... due to firework smoke. That gives you some idea of how rare air this bad is in the DMV; last week, the U.S. Capital endured its worst smoke pollution on record.
Now for the good news: Clear air is expected to stick around this week as winds move the remaining pollutants north and east. There is no guarantee smoke won’t be back later this month or summer, but for now, it appears the Capital region can enjoy a breath of fresh(er) air.
Smoke is expected to billow back over the central United States later this week although the pollution will likely be too high in the atmosphere to impact ground-level air quality significantly. Still, the sun might look a little more red than usual:
\u201cWe had a little break from the smoke, but it's coming back in aloft over the next few days. Visual effects expected with colorful sunrise/set, but good news in that we are not expecting impacts near the surface to spread into SE SD/SW MN/NW IA/NE NE in the near term.\u201d— NWS Sioux Falls (@NWS Sioux Falls) 1686582846
The high-level smoky haze could last through at least Wednesday.
The movement of smoke is famously tricky to predict, but there are a few different models you can use to keep an eye on your area. Here are the models for the next day from the FireSmoke Canada website, which tracks PM2.5 smoke particles at ground level from wildfires across North America. Check the FireSmoke Canada website or NOAA models for the most up-to-date forecasts and keep in mind that, like forecasting the weather, these are not guarantees. Err on the side of caution and protect yourself.
The model for 7 p.m. on June 12. Darker colors indicate higher PM2.5 levels, the particles associated with wildfire smoke. The numbered circles refer to the number of regional wildfires.FireSmoke Canada
The model for 7 a.m. on June 13. FireSmoke Canada
The model for 1 p.m. on June 13. FireSmoke Canada
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And more of the week’s top news about renewable energy conflicts.
1. Nassau County, New York – Opponents of Equinor’s offshore Empire Wind project are now suing to stop construction after the Trump administration quietly lifted its stop-work order.
2. Somerset County, Maryland – A referendum campaign in rural Maryland seeks to restrict solar development on farmland.
3. Tazewell County, Virginia – An Energix solar project is still in the works in this rural county bordering West Virginia, despite a restrictive ordinance.
4. Allan County, Indiana – This county, which includes portions of Fort Wayne, will be holding a hearing next week on changing its current solar zoning rules.
5. Madison County, Indiana – Elsewhere in Indiana, Invenergy has abandoned the Lone Oak solar project amidst fervent opposition and mounting legal hurdles.
6. Adair County, Missouri – This county may soon be home to the largest solar farm in Missouri and is in talks for another project, despite having a high opposition intensity index in the Heatmap Pro database.
7. Newtown County, Arkansas – A fifth county in Arkansas has now banned wind projects.
8. Oklahoma County, Oklahoma – A data center fight is gaining steam as activists on the ground push to block the center on grounds it would result in new renewable energy projects.
9. Bell County, Texas – Fox News is back in our newsletter, this time for platforming the campaign against solar on land suitable for agriculture.
10. Monterey County, California – The Moss Landing battery fire story continues to develop, as PG&E struggles to restart the remaining battery storage facility remaining on site.
A conversation with Biao Gong of Morningstar
This week’s conversation is with Biao Gong, an analyst with Morningstar who this week published an analysis looking at the credit risks associated with offshore wind projects. Obviously I wanted to talk to him about the situation in the U.S., whether it’s still a place investors consider open for business, and if our country’s actions impact the behavior of others.
The following conversation has been lightly edited for clarity.
What led you to write this analysis?
What prompted me was our experience in assigning [private] ratings to offshore wind projects in Europe and wanted to figure out what was different [for rating] with onshore and offshore wind. It was the result of our recent work, which is private, but we’ve seen the trend – a lot of the big players in the offshore wind space are kind of trying to partner up with private equity firms to sell their interests, their operating offshore wind assets. But to raise that they’ll need credit ratings and we’ve seen those transactions. This is a growing area in Europe, because Europe has to rely on offshore wind to achieve its climate goals and secure their energy independence.
The report goes through risks in many ways, including challenging conditions for construction. Tell me about the challenges that offshore wind faces specifically as an investment risk.
The principle behind offshore wind is so different than onshore wind. You’re converting wind energy to electricity but obviously there are a bunch of areas where we believe it is riskier. That doesn’t mean you can’t fund those projects but you need additional mitigants.
This includes construction risk. It can take three to five years to complete an offshore wind project. The marine condition, the climate condition, you can’t do that [work] throughout the year and you need specialized vehicles, helicopters, crews that are so labor intensive. That’s versus onshore, which is pre-fabricated where you have a foundation and assemble it. Once you have an idea of the geotechnical conditions, the risk is just less.
There’s also the permitting process, which can be very challenging. How do you not interrupt the marine ecosystem? That’s something the regulators pay attention to. It’s definitely more than an onshore project, which means you need other mitigants for the lender to feel comfortable.
With respect to the permitting risk, how much of that is the risk of opposition from vacation towns, environmentalists, fisheries?
To be honest, we usually come in after all the critical permitting is in place, before money is given by a lender, but I also think that on the government’s side, in Europe at least, they probably have to encourage the development. And to put out an auction for an area you can build an offshore wind project, they must’ve gone through their own assessment, right? They can’t put out something that they also think may hurt an ecosystem, but that’s my speculation.
A country that did examine the impacts and offer lots of ocean floor for offshore is the U.S. What’s your take on offshore wind development in our country?
Once again, because we’re a rating agency, we don’t have much insight into early stage projects. But with that, our view is pretty gloomy. It’s like, if you haven’t started a project in the U.S., no one is going to buy it. There’s a bunch of projects already under construction, and there was the Empire Wind stop order that was lifted. I think that’s positive, but only to a degree, right? It just means this project under construction can probably go ahead. Those things will go ahead and have really strong developers with strong balance sheets. But they’re going to face additional headwinds, too, because of tariffs – that’s a different story.
We don’t see anything else going ahead.
Does the U.S. behaving this way impact the view you have for offshore wind in other countries, or is this an isolated thing?
It’s very isolated. Europe is just going full-steam ahead because the advantage here is you can build a wind farm that provides 2 or 3 gigawatts – that’s just massive. China, too. The U.S. is very different – and not just offshore. The entire renewables sector. We could revisit the U.S. four or five years from today, but [the U.S.] is going to be pretty difficult for the renewables sector.
What I’m hearing from developers and CEOs about the renewable energy industry after the Inflation Reduction Act
As the Senate deliberates gutting the Inflation Reduction Act’s clean electricity tax credits, renewable energy developers and industry insiders are split about how bad things might get for the sector. But the consensus is that things will undoubtedly get worse.
Almost everyone I talked to insisted that solar and wind projects further along in construction would be insulated from an IRA repeal. Some even argued that spiking energy demand and other macro tailwinds might buffer the wind and solar industries from the demolition of the law.
But between the lines, and beneath the talking points and hopium, executives are fretting that lots of future investments are in jeopardy. And the most pessimistic take: almost all projects will have their balance sheets and time-tables impacted in some way that’ll at minimum increase their budget costs.
“It’s hard to imagine, if the legislation passes in its current form, that it wouldn’t impact all projects,” said Rob Collier, CEO of renewable energy transaction platform LevelTen.
Even industry analysts with the gloomiest views of the repeal say there’s plenty of projects that will keep chugging along and might even become more valuable to investors if they’re close enough to construction or operation. This aligns with recent analysis from BloombergNEF, which found the House bill would diminish our nation’s renewables build-out – but not entirely end its pace.
“The more useful way to break down which project may be hit the hardest is where the projects are going to fall in their development life-cycle,” Collier said. “Projects that have either started construction or have the ability to start construction … are going to very likely rise in terms of their appeal and attractiveness and those projects will be at a premium, if they’re able to skate through the legislative risk and qualify for tax credits.”
There is a more optimistic industry view that believes increased project costs will just be passed along to consumers via higher electricity prices. The American people will in essence have to pick up the tab where the federal tax code left it. Optimists also cite the increased use of power purchase agreements, or PPAs, between renewables developers and entities who need a lot of electricity, like big tech companies. By signing these PPAs, buyers are subsidizing the construction of projects but also insulating themselves from the risk of rising electricity prices.
The most bullish perspective I heard was from Nick Cohen, the CEO of Doral Renewables, who told me deals like these combined with rising premiums for quick energy on the grid may obviate lost credits in a “zero-incentive environment.”
“It’s not the end of the world,” Cohen told me. “If you’re in construction or you’re going to be in construction very soon, you’re fine.”
But Collier called Cohen’s prediction an “experiment” in customers’ willingness to pay for new energy: “If we’re talking about 40%, 50%, 60% of a project’s capital stack now being at risk because of tax credits, those are pretty large price increases.”
I spoke to multiple companies that have been inking massive deals as this legislation has progressed — although many were not nearly as sanguine about the industry’s future prospects as Doral. Like rPlus Energies, which disclosed last week that it closed a commitment for more than $500 million in tax equity investments for a solar and storage project in Utah. rPlus CEO Luigi Resta told me that the legislation “certainly has posed concern from our investors and from the organization” but the project was so far along that the tax equity investment market wasn’t phased by the bill.
“Many people in my company, myself included, have been doing this for more than 20 years. We’ve seen the starts and stops related to ITC and PTC in solar and wind, in multiple cycles, and this feels like another cycle,” Resta told me. “When the IRA passed, everybody was exuberant. And now the runway looks like it may have a cliff. But for us, our mantra since the beginning of the year has been ‘proceed with caution, preserve and protect.’”
However, crucially, it is important to focus on how that caution looks: Resta told me the company has completely paused new contracting while the company is completing the projects it is currently developing.
One government affairs representative for a large and prominent U.S. renewables developer, who spoke on the condition of anonymity to preserve relationships, told me that “whatever rollback occurs will just result in higher electricity prices over time.” In the near term, the only language that would truly gut projects in progress today would be “foreign entity of concern” restrictions that would broadly impact any component even remotely connected to Chinese industries. Similar language all but kneecapped the entire IRA electric vehicle consumer credit.
“It included definitions of what it means to be a foreign company that were really vague,” the government affairs representative said. “Anyone who does any business with China essentially can’t benefit from the credit. That was a really challenging outcome from the House that hopefully the Senate is going to fix.” If this definition became law, this source said, it would be the final straw that “freezes investment” in renewable energy projects.
Ultimately, after speaking to CEO after CEO this week, I’ve been left with an impression that business activity in renewables hasn’t really subsided after the House bill passed, and that it’ll be the Senate bill that undoubtedly defines the future of renewable energy for years to come.
Whether that chamber remains the “cooling saucer” it once was will be the decider.