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We didn’t know it was coming. We didn’t know where it came from. We still can’t nail its climate change connection.

What happened?
No, seriously — what happened?
Last week, the American megalopolis, that string of jewels on the old Atlantic coast, found itself shrouded by wildfire smoke. New York City’s air turned ashen and dun, then glowed a supernatural amber. For the first time in who-knows, sightseers standing at the U.S. Capitol Building could not see the Washington Monument, a mile and change down the Mall.
You could list the sports games canceled or flights delayed, but what was oddest about the event was the sheer ubiquity of it. This was one of the few news stories I can remember where you could look up from whatever article you were reading and see the story itself, softly lapping at your window.
And then it was gone. By Friday, the haze had blown out to sea.
It was, in retrospect, a strange time — deeply strange, humblingly strange, strange before almost any other quality. More than 128 million Americans were under an air-quality alert on Wednesday night — roughly the population of Germany and Spain combined — but scarcely 36 hours earlier, nobody had known to prepare for anything worse than a moderate haze. The country’s biggest wildfire-pollution event on record arrived essentially out of nowhere.
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One of the main modes of journalism today — but also, frankly, one of the main frames of our whole cultural apparatus, from TikToks that lightly gloss Wikipedia articles to rampant right-wing conspiracism — is that of the explanation. Everyone explains what’s happening to each other, as it happens, at all times, and therefore makes the world seem rational, empirical, and less frightening. Yet with the wildfire smoke, what is so striking is how little we understood. Nearly every important step in the story was misapprehended as it happened.
We didn’t know that the smoke was coming, for instance. On Tuesday morning, meteorologists predicted that the same moderate haze that has hung around all season would again hit the East Coast. The New York Department of Environmental Conservation put out an alert saying that the air quality index, or AQI, might rise to 150 across the state.
They did not forecast — nobody, as far as I can tell, did — that the worst air pollution in decades would soon wallop the state. By Tuesday night, New York City’s AQI had already reached 174, according to Environmental Protection Agency data. As I walked home in D.C., I could see tendrils of visible smoke hugging the upper stories of apartment buildings.
This prediction failure gave the ensuing response a halting, confused quality. How could such a massive event come out of nowhere? Not until Thursday afternoon — when the smoke had nearly passed — did the federal government advise its workers that they could telework or take vacation time to avoid the bad air. On Friday, New York closed in-person schools, just in time for blue sky to return.
I find it hard to blame them. This was an unprecedented event in part because the fires were so far from where they affected. Everyone had seen the videos of smoke besieging Portland and San Francisco in 2020, but back then, the fires had been near those cities — a couple hundred miles away at most. Where was the smoke coming from now? The Adirondacks were fine. Vermont was’t burning.
Here, we misunderstood again. Many outlets — including this one, at first — initially reported that the smoke came from Nova Scotia, where large and destructive fires had raged the week before. But those fires had been doused over the weekend by some of the same weather pattern that was now ferrying smoke to us. In fact, the smoke had come from the boreal forests of northern Quebec, more than 500 miles from New York City.
Why were these fires raging? Not even Canadians could give a good answer. With fires in Alberta and Nova Scotia gobbling attention and resources, the Quebec fires had seemingly been an afterthought until their smoke blew into Toronto and Ottawa, which happened only a few hours before it arrived in New York. Suddenly, a secondary event had become the main event.
On Wednesday, I talked to a Canadian climatologist who seemed hazy about why Quebec was burning in the first place. “I think this situation is kind of similar to Nova Scotia,” he told me, blaming that province’s warm, dry spring for the blazes. But this explanation — which appeared in many outlets — was only somewhat true: While Quebec had suffered a warm May, it was not in drought.
We did not understand why these fires are burning — and honestly, we still don’t. President Joe Biden said that the smoke provided “another stark reminder of the impacts of climate change.” I am not so sure. There’s no doubt, to be clear, that climate change will make wildfires worse across North America: The Intergovernmental Panel on Climate Change says that hot, dry “fire weather” will increase throughout the 21st century. But, again, Quebec is not in drought. As for today, no climate-change signal has appeared in eastern Canadian wildfire data. Their connection to climate change is far less clear cut than it is in, say, California’s blazes.
Yet neither would I condescend to someone who does blame climate change here. When something like this happens, how can you not cite the planet’s biggest ongoing physical transformation? If climate change makes flukey weather more likely, shouldn’t we at least consider it being responsible for some of the flukiest weather in decades? The thing about unprecedented events is that you lack precedent for them.
Not that we completely lack an example for this. In 1780, the sun was blotted out across New England. Nocturnal animals came out; people fretted in the streets and abandoned their work; the Connecticut state legislature considered adjourning for doomsday. Not until a decade ago did we finally learn that the “dark day” was caused by Canadian wildfire smoke drifting south.
Which suggests that this might be a once-in-250-year event. But maybe it’s not any more. Maybe with climate change, it’s a once-a-century event. Or a once-in-a-decade event. For now, the sample size is two.
So I wonder: If it wasn’t climate change, would it matter? The pandemic has already taught us that indoor air quality matters, that unseen particles floating in the air can do serious harm. No matter what happens with the climate, Canada is too large and unpopulated to fight every wildfire; neither can it manage the same kind of labor-intensive forest management that California might attempt. East Coasters should come away from our own dark days with new compassion for people out West — and those across the world — who must deal with wildfire smoke on a seasonal basis, not to mention the fires themselves. Regardless of climate change’s role in this fire, it makes wildfires more likely: We should continue to try to decarbonize as fast as we can.
But as for local policy, perhaps our aims should be humbler. We now know (again) that a great cloud of wildfire smoke can blow up on the East Coast at any moment and poison our air. We don’t need to know everything to protect ourselves and our neighbors from that. Air filters cost hundreds of dollars, but not thousands; in new multi-family buildings, they are built into the ventilation system itself. Perhaps the right lesson from this outbreak should be to change our expectations, and think of indoor air filtering like brushing your teeth — a habit essential to our hygiene, to be used by all, and to be provisioned for those who cannot afford one at the public expense.
Maybe that’s prudent climate adaptation. Or maybe — in the wake of COVID, Canadian smoke, and who-knows-what-comes-next — it’s just new common sense.
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Risk-averse but deep-pocked institutional investors join the party.
When the Fusion Industry Association surveyed the sector earlier this month, it found that the industry’s 56 active companies had collectively raised more than $14.2 billion over the past five years. But an ever-larger share of that money is ending up in the hands of one startup: Commonwealth Fusion Systems.
With its latest $1 billion funding round, announced today, the MIT spinout now accounts for nearly 30% of all capital in the industry. The new financing, led by a wave of institutional investors entering the sector for the first time, will support construction of the company’s first commercial power plant in Chesterfield County, Virginia, which CEO Bob Mumgaard says is on track to come online in the early 2030s.
In a media briefing, Mumgaard noted that this latest raise marks “the largest single funding round among fusion energy companies since our last large round of $1.8 billion in 2021.” It brings the total capital raised by CFS to an even $4 billion as the company races to complete construction of SPARC, its demo reactor. If all goes according to plan, it should begin operating sometime next year, proving out the physics and engineering approach underpinning ARC, the planned commercial plant.
The new financing deviates from the typical venture capital round, as it brings in a broad but unnamed mix of “large pension funds, sovereign wealth funds, infrastructure funds doing project finance, and industrial corporates.” These risk-averse investors would typically steer clear of expensive, first-of-a-kind facilities, demonstrating the degree to which CFS has succeeded in building confidence in an industry long critiqued for overpromising and underdelivering.
The company credits the trust it built to its extensive peer-reviewed research as well as its decision to build a tokamak — widely regarded as the most mature fusion reactor design. “I don’t think there’s any other company that’s been as transparent and open with their physics and how it actually works,” Katie Rae, CEO and managing partner at Engine Ventures, told me. Rae has participated in every one of CFS’s funding rounds, and while she says her firm has evaluated virtually every startup in the sector, the company remains its only fusion investment.
But even flush with institutional capital, Mumgaard is clear that the company will need billions more to fully finance ARC and the numerous reactors to follow. It’s unclear where exactly that money will come from, though he’s pushing for government involvement. Alongside the Fusion Industry Association, Mumgaard is advocating for a one-time, roughly $10 billion federal infusion of cash into the broader industry to expand public-private partnerships, build shared research infrastructure, and help finance first-of-a-kind plants in an effort to keep pace with China’s rapidly growing fusion program.
According to reporting from Politico, a Department of Energy official told CFS and other fusion companies that such a level of federal funding is “unrealistic in this environment.” But though insiders argue it’s what the industry needs to scale, Rae says CFS doesn’t depend on it. “I think it is the right kind of investment to make, but we didn’t count on it from an investor perspective,” she told me.
One obvious alternative is the public markets. The IPO window for climate tech has reopened, with geothermal giant Fervo and nuclear fission startup X-energy both completing successful public offerings in recent months. SPACs have also made a comeback, as numerous nuclear companies are opting for this faster, though riskier, path to the public markets. But CFS’s newly appointed CFO, Lorence Kim, said during the briefing that this latest round proves “that the private markets have a lot of capital to deploy toward our mission.” Whether an IPO is in the company’s near future remains an open question, though he cautioned against interpreting his hiring as any indication of “IPO prep in a specific way.”
For what it’s worth though, Kim has taken another high-profile, pre-revenue startup public before: Moderna. As CFO from 2014 to 2020, he helped the company scale its mRNA platform and lead its blockbuster $600 million IPO in late 2018 — the largest ever in the biotech industry at the time. Notably, this all happened before Moderna had an approved product or the Covid pandemic made its signature vaccine a household name, similar to where Commonwealth finds itself today.
“Moderna was in this moment in time where the science worked, and the strategy was focused on execution and scale and deploying capital in a way that could enable real impact on the world,” Kim explained. CFS is now at the same juncture, he said. “And so in the same way that Moderna industrialized mRNA and made it inevitable and made it ubiquitous, it was really clear to me that CFS could do the same for fusion.”
Of course, CFS is not alone in its confidence — other fusion companies are equally bullish on their own approach. Take Inertia Enterprises, a Lawrence Livermore National Laboratory spinout, which last week unveiled its own commercial roadmap for a laser-driven fusion reactor. The company emphasized it’s the only one to have definitively demonstrated the viability of its underlying physics in a real-world experiment, rather than through theoretical work or simulations.
Or take Helion, which has raised $1.5 billion and secured a highly ambitious power purchase agreement with Microsoft to supply electricity to the tech giant by 2028. Or Pacific Fusion, which netted a staggering $900 million Series A to be doled out in milestone-based tranches. There are dozens of others — many with hundreds of millions in funding — pursuing a range of approaches that some of the field’s brightest minds consider technically feasible.
But when I mused to Rae about how exciting it is that institutional investors now appear willing to back an industry once viewed as bordering on science fiction, she was quick to correct me.
“They’re willing to bet on Commonwealth Fusion — that’s what you mean.”
At least one hyperscaler’s big bets seem to be paying off.
This is an edition of Heatmap Daily, an evening review of the day’s news written by our executive editor. Sign up for it here.
Good evening. Let’s start with the news. Meta and Microsoft released their most recent quarterly earnings this evening, and Wall Street was watching to figure out if their enormous AI spending plans are paying off. We were watching because those proposals are shaping one of the most important energy stories today: the data center boom and the sharp return of electricity demand.
The returns were … mixed. Meta missed analysts’ estimates, and its profit fell 14% from the same quarter a year earlier. It increased the lower bound of how much it plans to spend on capital expenditures such as data centers this year, from $125 billion to $130 billion, but left the upper bound of $145 billion unchanged.
Microsoft, meanwhile, said its AI investments are starting to pay off. Revenue at its cloud business, which uses its data center space, increased by 43%, more than analysts expected. It spent $41 billion on capital expenses in the three months ending in June.
Meta’s stock was down 7% in after-hours trading, while Microsoft is up 8%. When Heatmap surveyed climate insiders last year, they ranked Microsoft as among the most decarbonization-friendly hyperscaler and Meta as among the worst.
Permitting odds up — thanks to Shift Key?
I do not regularly follow such things, but this afternoon I was told that the Kalshi market for “Will permitting reform become law this year?” surged to 77% today after trading for days around 50%:
I have no idea why it budged today, but perhaps what moved the market was our new episode of the Shift Key podcast (Apple, Spotify). On today’s show, I spoke with Daniel Palken, a former Capitol Hill policy staffer now at Arnold Ventures, about the current state of permitting reform negotiations in Congress. While we don’t know the exact shape of a deal yet, permitting reform is likely to be the biggest new policy for clean energy that we could get by the end of the year.
Daniel is a fantastic guide to the negotiations, and if you’re curious about the policy at all, I recommend that you listen. Here are few of my takeaways from the conversation:
1. A permitting reform deal will probably have six buckets.
They are (1) changes to the National Environmental Policy Act and the judicial review process that environmental studies face after completion; (2) reforms to the transmission process; (3) changes to the Clean Water Act; (4) a deal to make it harder for presidents to yank permits from approved projects; (5) changes to the National Historic Preservation Act, and (6) “everything else,” a grab bag of smaller fixes including to geothermal energy.
2. Wonky committee politics are shaping the deal.
The National Historic Preservation Act, for instance, is an archeological law that hasn’t been in the mix for previous reform proposals. It’s up for discussion now because Senator Mike Lee of Utah chairs the Senate Energy and Natural Resources Committee — and the NHPA is the major environmental bill under his jurisdiction. Likewise, observers think that a permitting deal has a much better shot of passing during this Congress (as compared to next year) because of an expected series of changes to committee chairs.
3. It’s way, way better to hook data centers to the power grid than run them off behind-the-meter power plants — even if they run off 100% natural gas.
Any permitting reform proposal will seek to expand the transmission system. That could have big benefits for the emissions intensity of data centers. Why? I’ll let Daniel explain:
If you look at the data centers that are hooking up off grid — when they’re not using repurposed jet engines, they’re using 20% thermally efficient gas plants. Whereas if you’re hooked up to the grid, there’s really two types of gas plants that live on the grid. There’s like 60% efficient combined-cycle gas turbines, which are most of the gas power that’s generated, and then there’s peaker [plants], which have low efficiency, but are run at capacity factors of like 5% — so from an emissions perspective, they don’t matter all that much.
So even if solar and wind didn’t exist at all, and nuclear didn’t exist, and hydro didn’t exist, it would still be a much, much cleaner option [to connect data centers to the power grid]. Like we’re talking factors of three in efficiency to connect your data center to the grid if it was purely powered by gas, which is, I think, an important point to understand.
I thought that was an interesting point, and while I’d seen some of those ideas in isolation, I’d never seen them laid out in one place. (And even if grid-scale gas plants are much more efficient than behind-the-meter plants, it’s still even better to power data centers with solar, batteries, and other clean firm power plants — which is also easier when they’re hooked up to the grid.)
I’ll stop glossing the episode and just link to it one more time. Thanks for reading.
On nuclear waste, a Nevada solar farm, and lithium-harvesting nanorobots
Current conditions: France just ordered 4,000 more people to evacuate the wildfires that have now displaced a third of a million people across southwestern Europe • The heat dome in the southwestern United States is driving temperatures in Phoenix up to 113 degrees Fahrenheit by the end of the week • Temperatures in Tuscany are topping 100 degrees this week as Europe’s latest heat wave takes hold.
Just yesterday, I told you that China’s dominance over the manufacturing of the inverters needed to patch solar panels and batteries onto the grid and into data centers had peaked two years ago as Europe’s factories began booming. Hours after the newsletter landed in your inbox, the Trump administration unveiled plans to ban imports of Chinese power inverters in a bid to protect the U.S. buildout of artificial intelligence from sabotage and competition. On Tuesday, the Federal Communications Commission told CNBC its new restrictions aimed to safeguard the AI supply chain “from Chinese threats of disruption, data threat, and cyber attacks.” The measures also bar imports of Chinese-made humanoid and quadruped robots. As you may recall, Reuters broke news in May 2025 that the U.S. government had discovered rogue communications devices in the Chinese-made inverters. The story came out just a month after a frequency problem that stemmed from Spain’s struggle to sufficiently patch all of its solar generation on the grid triggered a blackout across Iberia, highlighting the sort of scenario a compromised “killswitch” device could set off in a bid to attack energy systems.
The ban is good news for America’s beleaguered solar manufacturing industry, which the Trump administration has championed with tariffs but hobbled by axing key federal tax credits that included bonuses for projects using domestically produced panels. T1 Energy, shares of which nosedived this week after the latest quarterly earnings showed losses far outpacing revenue, just spent another $135 million on patents from a rival in Singapore in a bid to vertically integrate production of a more efficient type of photovoltaic technology. Tesla, meanwhile, is promising to “multiply” American solar production by “an order of magnitude.” Yet Elon Musk’s behemoth is cutting long-term deals to buy other people’s solar power. The company just inked an agreement with a KKR-backed solar and battery project in Arizona to buy 90% of its output.

Reasonable people debate just how much electricity is needed to satisfy the demands of the data center boom — and the bears are likely to get a boost amid this week’s selloff of AI stocks. But the latest projections from the Rhodium Group forecast U.S. electricity demand growth to accelerate over the next 15 years, “growing faster than it has since the turn of the century.” Data centers will account for between 62% and 77% of the growth in 2030, and between 59% and 66% in 2040, ultimately reaching 17% of total electricity demand that year. Electric vehicles will make up the second-largest source of new demand growth in the low- and mid-emissions scenarios the consultancy outlined through 2040. In the high-emissions scenario, heavy industry will account for a quarter of the demand growth between 2025 and 2040. Overall, the findings show divergent pathways in the 2030s. By 2040, the U.S. will either reduce its greenhouse gas emissions by 41% below 2005 levels — or just 27%. Across all three scenarios, the “historic influx of renewables” coming online between now and 2030 keeps emissions declining. After 2030, however, the grid’s trajectory either continues to deploy nearly 53 gigawatts of renewables per year through 2040 in a low-emissions scenario or drops to 3 gigawatts per year in a high-emissions scenario where cheap natural gas dominates.
For months now, the Greenhouse Gas Protocol, the nonprofit behind a voluntary but widely used corporate standard for carbon accounting rules, has been revising its approach. Last year, my colleague Emily Pontecorvo explained the stakes of the revision process as an “obscure philosophical battle that could reshape the clean energy economy. In April, she broke news from whistleblowers that the changes underway were drumming up controversy. This morning she’s out with a new story on Greenhouse Gas Protocol’s plans to marry its standard to those by the International Organization for Standardization. The short of it is this: the changes are getting a lot of pushback, and credibility of the forthcoming new standard remains an open question.
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For decades, the U.S. plan to deal with nuclear waste has focused on building a highly controversial repository in the Nevada desert. But that effort, as I explained yesterday, was put on indefinite hiatus in 2010 when the Obama administration canceled funding on behalf of then-Senate Majority Leader Harry Reid, a Nevada Democrat. In the meantime, states such as Texas and New Mexico have demonstrated that both Republican and Democratic governments are still willing to fight efforts to build intermediate-term storage facilities for nuclear waste in their states. On Tuesday, five states officially stepped up and made bids to host what the Department of Energy is calling its Nuclear Lifecycle Innovation Campuses, which will house startups that recycle spent nuclear waste into fresh fuel and medical isotopes. The Energy Department named Utah, Tennessee, Oklahoma, Louisiana, and Idaho as finalists for the facilities. “I’m pleased to announce that after reviewing 28 applications from 26 states, the Energy Department has selected five initial contenders to further explore building Nuclear Lifecycle Innovation Campuses,” Secretary of Energy Chris Wright said in a statement. “These campuses will be massive generators of economic growth, create thousands of high-paying jobs, and be crucial to unleashing America’s nuclear renaissance.”
Just last week, the Energy Department opened the door to nuclear projects sited on floating offshore platforms. It’s a novel idea for the U.S., but Russia launched its Akademik Lomonosov, a floating nuclear station, in 2019 in what is widely recognized as the world’s first real small modular reactor and only operating non-land nuclear plant. A new peer-reviewed study the World Nuclear Association conducted on the Rosatom-owned plant ranked it “on par with Russia’s top units,” World Nuclear News reported.
Trump’s permitting freeze for renewables projects started to thaw for solar in particular earlier this year as the administration faced mounting pressure to stop thwarting the fastest-growing source of power in a country increasingly starved for new and swiftly available sources of electricity. The easing, as my colleague Jael Holzman wrote, was also part of a legal strategy. Regardless of the reasoning, the thaw is continuing — and not just because of the literal heat dome pushing temperatures in the Southwest into the triple digits. On Tuesday, the Department of the Interior’s Bureau of Land Management announced plans to advance a solar project in the Nevada desert. The Mosey solar farm, which would produce enough power at maximum output for 200,000 homes, is now under evaluation at the agency’s Nevada office, the agency notified the Federal Register. The regulator plans to conduct an environmental analysis and a resource management plan tweak needed for a project in a utility corridor. E&E News credited the administration’s shift on this particular project to lobbying by the state’s Republican governor, Joe Lombardo.
The project is part of developer Clearway’s larger efforts in Nevada. Separately, the company has volunteered to scrap one of its other solar projects in favor of building a gas plant, Jael reported this week.
Yesterday, I told you the board of PJM Interconnection had scheduled an emergency auction to drum up 7 gigawatts of additional capacity to supply the electricity demand from data centers starting in 2028. It’s just one incremental way the nation’s largest grid system is “lurching toward reforms,” as my colleague Matthew Zeitlin wrote. It’s also inching toward more actual power infrastructure. On Wednesday, the developer Eolian Energy started construction on Flint Grid, a 1 gigawatt-hour storage project outside Columbus, Ohio. Located near a hub of data center and industrial power users, the Flint Grid project is “the first large-scale battery energy storage system to qualify for the PJM capacity market.” If it comes online in spring 2027 as promised on the project’s new website, it will represent more than half the new battery storage capacity in PJM’s line up for 2027 to 2028. The project is also the first grid-scale battery project permitted by the Ohio Power Siting Board and the largest in the PJM territory to date.
“There’s growing consternation about how the US can rapidly scale infrastructure to support America’s growing electricity demand, but not nearly enough conversation about how to use existing technology to unlock the wasted capacity that already exists on the grid,” Eolian founder and CEO Aaron Zubaty said in a statement. “This project requires hundreds of millions of dollars to construct, and we committed the necessary capital and resources years before today’s demand forecasts became headline news. As policymakers consider changes to competitive electricity markets, it’s critical that they avoid undermining the long-term investments already.”
Lithium production typically involves either mining hard rocks or extracting salts through brines. Both are water intensive processes with considerable environmental tolls. Scientists at Texas A&M University are now developing a new approach involving the deployment of tiny, fish-like swimming nanorobots that capture lithium ions from seawater. Backed by a $1 million Energy Department grant, it’s among more than a dozen projects the agency is supporting in a bid to bolster domestic critical mineral supplies. “Unlike traditional mining that digs up land or pumps brine from underground and requires massive amounts of energy, these autonomous micro/nanorobots move freely through seawater to harvest lithium with virtually zero infrastructure footprint,” Jingjing Qiu, one of the mechanical engineers leading the research, said in a statement.