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Don’t jinx it, but America is quietly making progress on one of the biggest challenges to the renewable energy rollout.

New England is about to get a big infusion of carbon-free energy. On Thursday, a Maine jury ruled that a 145-mile power line connecting hydroelectric dams in Canada with the New England grid via western Maine could continue construction. The poles and wires are set to deliver enough clean electricity to power more than a million homes. They will lower costs for consumers while also cutting greenhouse gas emissions by 3.6 million metric tons per year.
It’s the latest in a string of victories for transmission projects that will pave the way for thousands of megawatts of clean energy to come online over the next decade. Quietly over the past few months, the U.S. has begun to overcome one of the central hurdles to the renewables rollout.
Climate-concerned states like Massachusetts and California that have been trying to cut emissions from their electricity grids have been stymied by literal gridlock. All over the country, the electric grid is jammed up, leaving hundreds of new wind, solar, and battery projects waiting in a symbolic line called the “interconnection queue” to find out what upgrades need to be made to the grid before they're able to connect.
But there's another, related problem: Renewable energy projects aren’t getting built because there are no transmission lines capable of bringing the vast wind and solar energy resources found in rural areas to major population centers.
It hasn’t been for lack of trying. But transmission projects end up in limbo for years due to long environmental review processes, interstate feuds, and community or landowner opposition. Over the last decade, the country’s transmission system expanded by about 1% per year. In order to achieve the full potential emission reductions made possible by clean energy subsidies in the Inflation Reduction Act, that pace will have to more than double to 2.3%, according to Princeton University’s Zero Lab.
The Maine power line, called the New England Clean Energy Connect, has been in progress since 2017. But it was put in jeopardy in late 2021 when Maine voters approved a referendum to halt construction of the line. Mainers were concerned about the environmental and tourism impacts of clearing a path for the power line through the state's famous North Woods. They mistrusted the developer, Central Maine Power, which had recently been accused of overcharging customers. The campaign against the project was also bolstered by millions of dollars from a rival utility company, NextEra.
This was all bad news for Massachusetts, which was under contract to receive the bulk of the power line’s capacity, and was counting on the project to achieve its climate goals. According to the Commonwealth’s Clean Energy and Climate Plan, the transmission line from Canada would “be a significant least-cost clean energy resource for the region largely because it complements and balances offshore wind generation, reducing energy costs for the entire region.” To get the same amount of energy from solar panels, the state would require more than 30,000 acres of land, the plan says.
Though Maine could appeal this week’s decision, for now the project is legally allowed to proceed. And it’s actually one of a bunch of new transmission lines that are on the way,
Just last week, the Bureau of Land Management issued the final approval for a long-beleaguered project called the TransWest Express, a 732-mile string of wires and towers that will deliver power from vast, new wind farms in Wyoming to California and throughout the Southwest. The agency began reviewing the project in 2008.
In January, senior White House officials, including Vice President Kamala Harris, celebrated the groundbreaking of another line called the Ten West Link that has been under development since 2015. Once built, the 125-mile, 3,200-megawatt project connecting Arizona to southern California is expected to enable new renewable energy projects across the region by opening up more room on the grid.
These announcements follow another transmission milestone last November, when construction started on the Champlain Hudson Power Express. The 339-mile power line will bring Canadian hydropower to New York City, powering more than a million homes and helping the state achieve its goal of having a zero-emissions grid by 2040.
And there’s more to come. Later this year, Missouri and Kansas could issue the final approvals for a project a decade in the making — the Grain Belt Express — which will deliver wind and solar power throughout the Midwest.
While all of these projects will go a long way toward building a clean energy future, they’ve also all been a long time coming. There’s no question the U.S. will need to reform the way transmission lines are planned and permitted in order to realize the emissions cuts needed to tackle climate change.
One of the biggest hurdles is figuring out who should pay for these projects, a problem that the Federal Energy Regulatory Commission, which regulates interstate energy infrastructure, is trying to resolve. If Congress can ever reach a deal to ease the permitting process for big infrastructure projects, that too would help. And there’s another change that some advocates feel is essential. Environmentalists, long allergic to big infrastructure projects, must learn to accept when their benefits outweigh their costs.
As a recent cover story in The Economist with the headline, “Hug pylons, not trees,” put it, “The sagging wires held aloft by charmless, skeletal pylons … are for the most part truly unlovely. But loved they must be.”
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The Treasury Department released partial guidance for the new “foreign entities of concern” restrictions on clean energy tax credits.
The Treasury Department published long-awaited guidance for claiming the clean energy tax credits on Thursday, ending the state of limbo in which project developers have languished since the One Big Beautiful Bill Act passed last summer. Well, sort of.
Trump’s tax law put new restrictions on many of the clean energy tax credits, limiting eligibility to projects that could prove they had minimal material inputs or oversight from a handful of countries labeled “foreign entities of concern,” i.e. Russia, North Korea, Iran, and, most problematically, China. The problem was that it was hard to suss out exactly how to follow these rules. The Treasury Department would have to provide clarification, or in the parlance of federal tax law, “guidance.” Without this, developers might unintentionally break the rules, get audited, and then owe the government a bunch of money — a risk that financiers are not keen to take.
Now, developers have, shall we say, partial guidance. The FEOC rules have two main components, and a notice published by the IRS Thursday covers one of them.
The guidance clarifies how to calculate the material assistance limits, which ask for proof that a certain percentage of the material inputs to the project did not come from a FEOC-owned or -influenced company. For a solar farm, for example, that includes the photovoltaic cells, the frame, the glass, the sealant, the circuit boards, etc. These limits apply to the clean electricity investment and production tax credits (48E and 45Y), as well as the clean manufacturing credit (45X), and went into effect on January 1 of this year.
The notice the Trump administration published this week demystifies the material assistance math for some project types, but not others. It says the Treasury will be publishing more on this by the end of the year.
Then there are foreign influence and “effective control” restrictions that have to do with the ownership structure of the project. Those apply to any project attempting to claim a tax credit, including carbon capture (45X), nuclear, (45X), and clean fuels (45Z), that started construction as of January 1, 2025. Even though these rules have been in effect for longer, the Treasury has yet to clarify how to follow them. The notice suggests the department will publish this along with the additional information on material assistance.
To be clear, development did not halt or even really slow as a result of this missing guidance, although that may have been starting to change. Many companies were able to avoid the arduous material assistance calculations by starting construction on their projects last year, before the new restrictions went into effect. They were also allowed to use past IRS guidance, including tables breaking out the various components of a project and their relative weights for determining the amount of domestic content in a project, which they could then apply to determine the amount of non-FEOC-produced materials as a temporary solution.
As for the ownership restrictions, “you just err on the side of caution,” David Burton, a partner at the law firm Norton Rose Fulbright, told me.
I spoke to Burton late last night right after he had gotten through reading the new 95-page IRS notice, and he walked me through some of his initial takeaways.
What are the questions that companies had about FEOC prior to this that this document clears up?
It’s pretty specific on how to calculate whether or not you meet the material assistance percentage restriction. So for instance, if you have a repowered project, there was a question of, do you have to apply material assistance to the new stuff you’re adding? Or do you also have to apply it to the old stuff? And the rules clarify, it’s just the new stuff. If you have a solar project that you’re repowering by replacing the modules but you keep the old inverters, the new modules are subject to material assistance, the old inverters are not. So it clarifies that type of thing.
I think there’s going to be a lot of accountants doing spreadsheet work based on these calculations in the notice and the various elections and choices, trying to find the most advantageous path. I think it’s too early to tell if there’s some opportunities that the industry might benefit from, or some landmines that we weren’t anticipating, because there’s just … the calculations, there’s too many of them, they kind of link together, and it’s very complicated. So we need a little more than a couple hours to go through all that.
What do you mean by elections and choices?
You can use the domestic content safe harbor tables, or you can get a certification from a supplier. The notice says that if a supplier gives you a certification that says it’s not a prohibited foreign entity, and it’s not aware of any prohibited foreign entities in its supply chain, you can rely upon that. Or if it gives you a certification that says, I’m not a prohibited foreign entity, but 20% of the supply chain that feeds into my product is, you can rely upon that.
You’re unlikely to get top-to-bottom certifications that totally answer the question, but it is helpful.
We’ve talked in the past about how far up their supply chain companies will need to look to calculate material assistance. Does it answer those questions?
It does provide guidance on those questions, but really only for the technologies that are covered in the domestic content notices. So for instance, fuel cells or combined heat and power: If you’re not wind, solar, storage or some other technology, it doesn’t provide that much help. But it does clarify for wind, solar, and storage how to do the calculation. It provides some guidance for technologies other than wind, solar, and storage, but it’s still going to be pretty hard, I think.
What is still missing from the guidance? What are the open questions that certain projects might still face?
Foreign influence and foreign control, the notice doesn’t cover. For instance, there’s a rule that if 15% of your debt is held by Chinese banks, you don’t get tax credits. The notice doesn’t tell us how to apply that rule — how that applies if one lender transfers to another lender and syndications of debt, all that kind of stuff. It doesn’t even tell us at what level to apply that test. Do you apply it at the project company? Or at the ultimate parent company at the top of the ownership chain? So it gives us none of that.
How often are you running into that with clients?
Every deal where the project began construction after 2024 has that question. Most of the time it really shouldn’t be an issue, but you have to ask, who owns this entity? Who’s on your board? Who has the right to appoint people to your board? We’re starting to write a lot of memos about this stuff, but there’s not a lot of guidance.
How do you deal with that without guidance?
We have a statutory language, so it’s not like no guidance at all. You just err on the side of caution, and you err on the side of it being overbroad, and then you end up asking the parties involved a lot of due diligence questions. And they’re like, really? We have to answer your 1,000 questions here?
Do you think that, based on this guidance, this is workable for companies? This doesn’t seem to be the sort of backdoor way to kill the tax credits that some people initially feared.
I think it’s workable. I think it’s relatively even-handed. I think they are trying to make them administrable. Not easy, not simple — again, full employment for accountants. But at least you can spreadsheet it. It’s better to have to build a complicated spreadsheet than just be like, well, we don’t really know what the rule is, we’re not sure what the path is here.
Representatives Jake Auchincloss and Mark Amodei want to boost “superhot” exploration.
Geothermal is about the only energy topic that Republicans and Democrats can agree on.
“Democrats like clean energy. Republicans like drilling. And everyone likes baseload power that is generated with less than 1% of the land and materials of other renewables,” Massachusetts Representative Jake Auchincloss, a Democrat, told me.
Along with Republican Representative Mark Amodei of Nevada, Auchincloss is introducing the Hot Rock Act on Friday, focusing specifically on “superhot” or “supercritical” geothermal resources, i.e. heat deposits 300 degrees Celsius or above. (Temperatures in large traditional geothermal resources are closer to 240 degrees.)
The bill — of which Heatmap got an exclusive early peek — takes a broad approach to supporting research in the sector, which is currently being explored by startups such as Quaise Energy and Mazama Energy, which in October announced a well at 331 degrees.
There’s superhot rock energy potential in around 13% of North America, modeling by the Clean Air Task Force has found — though that’s mostly around 8 miles below ground. The largest traditional geothermal facility in the U.S. is only about 2.5 miles at its deepest.
But the potential is enormous. “Just 1% of North America’s superhot rock resource has the potential to provide 7.5 terawatts of energy capacity,” CATF said. That’s compared to a little over a terawatt of current capacity.
Auchincloss and Amodei’s bill would direct the Department of Energy to establish “milestone-based research grant programs,” under which organizations that hit goals such as drilling to a specific depth, pressure, or temperature would then earn rewards. It would also instruct the DOE to create a facility “to test, experiment with, and demonstrate hot dry rock geothermal projects,” plus start a workforce training program for the geothermal industry.
Finally, it would grant a categorical exclusion from the National Environmental Policy Act for drilling to explore or confirm geothermal resources, which could turn a process that takes over a year into one that takes just a couple of months.
Geothermal policy is typically a bipartisan activity pursued by senators and House members from the Intermountain West. Auchincloss, however, is a New Englander. He told me that he was introduced to geothermal when he hosted an event in 2022 attended by executives from Quaise, which was born out of the Massachusetts Institute of Technology.
It turned out the company’s pilot project was in Nevada, and “I saw it was in Mark Amodei’s district. And I saw that Mark is on Natural Resources, which is the other committee of jurisdiction. And so I went up to him on the floor, and I was like, Hey there, you know, there's this company announcing this pilot,” Auchincloss told me.
In a statement, Amodei said that “Nevada has the potential to unlock this resource and lead the nation in reliable, clean energy. From powering rural communities and strengthening critical mineral production to meeting the growing demands of data centers, geothermal energy delivers dependable 24/7 power.”
Auchincloss told me that the bill “started from the simple premise of, How do we promote this technology?” They consulted climate and technology experts before reaching consensus on the milestone-based payments, workforce development, and regulatory relief components.
“I didn't have an ideological bent about the right way to do it,” Auchincloss said.
The bill has won plaudits from a range of industry groups, including the Clean Energy Buyers Association and Quaise itself, as well as environmental and policy organizations focused on technological development, like the Institute for Progress, Third Way, and the Breakthrough Institute.
“Our grassroots volunteers nationwide are eager to see more clean energy options in the United States, and many of them are excited by the promise of reliable, around-the-clock clean power from next-generation geothermal energy,” Jennifer Tyler, VP government affairs at the Citizens' Climate Lobby, said in a statement the lawmakers provided to Heatmap. “The Hot Rock Act takes a positive step toward realizing that promise by making critical investments in research, demonstration, and workforce development that can unlock superhot geothermal resources safely and responsibly.”
With even the Trump administration generally pro-geothermal, Auchincloss told me he’s optimistic about the bill’s prospects. “I expect this could command broad bipartisan support,” he said.
Plus a pre-seed round for a moon tech company from Latvia.
The nuclear headlines just keep stacking up. This week, Inertial Enterprises landed one of the largest Series A rounds I’ve ever seen, making it an instant contender in the race to commercialize fusion energy. Meanwhile, there was a smaller raise for a company aiming to squeeze more juice out of the reactors we already have.
Elsewhere over in Latvia, investors are backing an early stage bid to bring power infrastructure to the moon, while in France, yet another ultra-long-duration battery energy storage company has successfully piloted their tech.
Inertia Enterprises, yet another fusion energy startup, raised an eye-popping $450 million Series A round this week, led by Bessemer Venture Partners with participation from Alphabet’s venture arm GV, among others. Founded in 2024 and officially launched last summer, the company aims to develop a commercial fusion reactor based on the only experiment yet to achieve scientific breakeven, the point at which a fusion reaction generates more energy than it took to initiate it.
This milestone was first reached in 2022 at Lawrence Livermore National Laboratory’s National Ignition Facility, using an approach known as inertial confinement fusion. In this method, powerful lasers fire at a small pellet of fusion fuel, compressing it until the extremely high temperature and pressure cause the atoms inside to fuse and release energy. Annie Kritcher, who leads LLNL’s inertial confinement fusion program, is one of the cofounders of Inertia, alongside Twilio co-founder Jeff Lawson and Stanford professor Mike Dunne, who formerly led a program at the lab to design a power plant based on its approach to fusion.
The Inertia team plans to commercialize LLNL’s breakthrough by developing a new fusion laser system it’s calling Thunderwall, which it says will be 50 times more powerful than any laser of its type to date. Inertia isn’t the only player trying to commercialize laser-driven fusion energy — Xcimer Energy, for example, raised a $100 million Series A in 2024 — but with its recent financing, it’s now by far the best capitalized of the bunch.
As Lawson, the CEO of the new endeavor said in the company’s press release, “Our plan is clear: build on proven science to develop the technology and supply chain required to deliver the world’s highest average power laser, the first fusion target assembly plant, and the first gigawatt, utility-scale fusion power plant to the grid.” Great, but how soon can they do it? The goal, he says, is to “make this real within the next decade.”
In more nuclear news, the startup Alva Energy launched from stealth on Thursday with $33 million in funding and a proposal to squeeze more capacity out of the existing nuclear fleet by retrofitting pressurized-water reactors. The round was led by the venture firm Playground Global.
The startup plans to boost capacity by building new steam turbines and electricity generators adjacent to existing facilities, such that plants can stay online during the upgrade. Then when a plant shuts down for scheduled maintenance, Alva will upgrade its steam generator within the nuclear containment dome. That will allow the system to make 20% to 30% more steam, to be handled by the newly built turbine-generator system.
The company estimates that these retrofits will boost each reactor’s output by 200 megawatts to 300 megawatts. Applied across the dozens of existing facilities that could be similarly upgraded, Alva says this strategy could yield roughly 10 new gigawatts of additional nuclear capacity through the 2030s — the equivalent of building about 10 new large reactors.
Biden’s Department of Energy identified this strategy, known as “uprating”, as capable of adding 2 gigawatts to 8 gigawatts of new capacity to the grid. Alva thinks it can go further. The company promises to manage the entire uprate process from ensuring regulatory compliance to the procurement and installation of new reactor components. The company says its upgrades could be deployed as quickly as gas turbines are today — a five- to six-year timeline — at a comparable cost of around $1 billion per gigawatt.
Deep Space Energy, a Latvian space tech startup, has closed a pre-seed funding round to advance its goal of becoming a commercial supplier of electricity for space missions on the moon, Mars, or even deeper into space where sunlight is scarce. The company is developing power systems that convert heat from the natural decay of radioisotopes — unstable atoms that emit radiation as they decay — into electricity.
While it’s still very early-stage, this tech’s first application will likely be backup power for defense satellites. Long term, Deep Space Energy says it “aims to focus on the moon economy” by powering rovers and other lunar installations, supporting Europe’s goal of increasing its space sovereignty by reducing its reliance on U.S. defense assets such as satellites. While radioisotope generators are already used in some space missions, the company says its system requires five times less fuel than existing designs.
Roughly $400,000 of the funding came from equity investments from the Baltic-focused VC Outlast Fund and a Lithuanian angel investor. The company also secured nearly $700,000 from public contracts and grants from the European Space Agency, the Latvian Government, and a NATO program to accelerate innovation with dual-use potential for both defense and commercial applications.
As I wrote a few weeks ago, Form Energy’s iron-air battery isn’t the only player targeting 100-plus hours of low-cost energy storage. In that piece, I highlighted Noon Energy, a startup that recently demoed its solid-oxide fuel cell system. But there’s another company aiming to compete even more directly with Form by bringing its own iron-air battery to the European market: Ore Energy. And it just completed a grid-connected pilot, something Form has yet to do.
Ore piloted its 100-hour battery at an R&D center in France run by EDF, the state-owned electric utility company. While the company didn’t disclose the battery’s size, it said the pilot demonstrated its ability to discharge energy continuously for about four days while integrating with real-world grid operations. The test was supported by the European Union’s Storage Research Infrastructure Eco-System, which aims to accelerate the development of innovative storage solutions, and builds on the startup’s earlier grid-connected installation at a climate tech testbed in the Netherlands last summer.
Founded in 2023, Ore plans to scale quickly. As Bas Kil, the company’s business development lead, told Latitude Media after its first pilot went live, “We’re not planning to do years and years of pilot-scale [projects]; we believe that our system is now ready for commercial deployment.” According to Latitude, Ore aims to reach 50 gigawatt-hours of storage per year by 2030, an ambitious goal considering its initial grid-connected battery had less than one megawatt-hour of capacity. So far, the company has raised just shy of $30 million to date, compared to Form’s $1.2 billion.
Battery storage manufacturer and virtual power plant operator Sonnen, together with the clean energy financing company Solrite, have launched a Texas-based VPP composed exclusively of home batteries. They’re offering customers a Solrite-owned 60-kilowatt-hour battery for a $20 monthly fee, in exchange for a fixed retail electricity rate of 12 cents per kilowatt-hour — a few cents lower than the market’s average — and the backup power capability inherent to the system. Over 3,000 customers have already enrolled, and the companies are expecting up to 10,000 customers to join by year’s end.
The program is targeting Texans with residential solar who previously sold their excess electricity back to the grid. But now that there’s so much cheap, utility-scale solar available in Texas, electricity retailers simply aren’t as incentivized to offer homeowners favorable rates. This has left many residents with “stranded” solar assets, turning them into what the companies call “solar orphans” in need of a new way to make money on their solar investment. Customers without rooftop solar can participate in the program as well, though they don’t get a catchy moniker.