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Delaying congestion pricing is one of the worst climate policy decisions made by any Democrat in recent memory.

If it holds, then Governor Kathy Hochul’s decision today to delay congestion pricing indefinitely in New York will be a generational setback for climate policy in the United States.
It is one of the worst climate policy decisions made by a Democrat at any level of government in recent memory.
It is worse than the Mountain Valley pipeline, the 300-mile gas pipeline that Senator Joe Manchin of West Virginia got approved in 2022 in exchange for supporting the Inflation Reduction Act.
And it is worse than the Willow project in Alaska, the oil mega-project that President Joe Biden okayed last year under pressure from that state’s local and indigenous leaders.
It is so bad because it will set back the development of climate-friendly cities and rapid transit infrastructure in the United States for years if not decades. And it will deter other American cities from implementing the kind of time-saving, pollution-averting, anti-gridlock measure that the country desperately needs.
There is nothing good to be said for this decision. It is bad politics, bad economics, bad governance, and bad for the climate.
Let us briefly count the ways that it is destructive.
It is stupid coalition politics. Hochul has alienated her allies, including environmental groups, state budget hawks, and transit advocates. Bill McKibben, the longtime New Yorker writer who has become one of the country’s most famous climate activists, called Hochul’s decision “one of the most aggressive anti-environmental actions ever undertaken by a Democratic governor.”
In exchange, Hochul has delighted her Republican adversaries, who can praise her wise decision-making in the weeks to come — and therefore brandish their own bipartisan bonafides — but continue to campaign against congestion pricing through November. Congestion pricing is unpopular now, but in her fecklessness, Hochul has guaranteed that it will be a live issue in November.
It is nonsense budget politics. Hochul says that she has delayed congestion pricing because she is worried about the city’s recovery from the pandemic, but regardless of her reasons, she has now left a $1 billion hole in the transit authority’s budget. The New York Times reports that she wants to fill that hole by raising taxes on the state’s businesses.
But that means that she has taken a tax formerly charged to some New York residents and businesses — but which would also fall on New Jersey and Connecticut residents and businesses — and shifted it entirely to in-state entities. She has, in essence, cut taxes on out-of-state residents and raised taxes on New York businesses and consumers.
And instead of taxing the right to use roads in downtown Manhattan, which are a limited public resource, she will instead tax all business activity in the state. What good will that do for New York’s economy?
Those political and financial flaws might be forgiven if her decision was good for the planet. But don’t worry: It’s also bad climate politics.
Cars, SUVs, and trucks belch more climate pollution into the atmosphere than any other single economic activity in the U.S. Nearly 20% of America’s annual carbon pollution comes from individuals and families driving their private vehicles around on roads and highways. This is a far larger share of national pollution than is generated by more famous climate villains, such as air travel.
We have good ways of dealing with all that carbon pollution. In suburbs, small towns, and rural America, the best way to deal with that tailpipe pollution is to gradually transition from gasoline-burning cars to electric vehicles. In some places, the country can also experiment with using experimental, climate-friendly liquid fuels.
But in cities, people have better and cheaper options than getting EVs. We can stop requiring people to drive everywhere and encourage them to walk, bike, and take public transit instead. That will require, at times, treating the use of roads in city centers as the limited public resource that it is — which means charging cars and trucks to enter the most crowded downtown areas of certain cities at certain times of the day.
That’s what congestion pricing is: a way of encouraging cities to grow in pro-climate, pro-environmental ways. Such a policy has already been successfully implemented in London, Singapore, and other congested cities. Even as an urban car owner, I long wanted the city where I lived for a decade — Washington, D.C. — to adopt a similar policy. After all, when Stockholm started its congestion fee, the rate of asthma attacks among its children dropped by half.
So I looked forward to the start of congestion pricing in New York City, America’s biggest, densest, and most transit-friendly city. New York was bushwhacking a trail for everyone else to follow: If congestion policy was a success there, then other American cities could experiment with it in some form.
By pausing that trial before it has even begun, Hochul has essentially frozen our ability to experiment with congestion pricing anywhere else in the country. By shuttering the policy in New York, she has poisoned pro-climate urban politics everywhere. Now people will say: You saw what happened when New York tried to do congestion pricing. Do you really want to try that here?
In the past, when national Democrats have approved new pipelines or oil projects, they have argued that those projects will not affect the country’s carbon pollution because only demand for fossil fuels, and not the supply of them, drives carbon emissions. But what makes congestion pricing so powerful is that demand is precisely what it targets. Congestion pricing makes buses run faster, pays for the subway system, and pushes people and businesses to consider the social cost of their driving before they get in the car.
Congestion pricing, if implemented widely, can actually conserve fossil fuels and cut carbon emissions. Now Hochul has halted its progress everywhere.
She has made, in other words, a local mistake with national and even global consequences. It is such a foolhardy error that it instantly recasts Kathy Hochul’s climate record as governor.
Hochul has previously been seen as a center-left governor playing a difficult but moderate environmental hand. But is that really her record? She has struggled to build wind farms off the coast of New York, even though it is essential to decarbonizing the state’s power grid. She has so far failed to pass the NY HEAT Act, which would help the state transition away from using fossil fuels to heat its buildings. She has even failed to pass little climate measures that would fund the state’s more modest climate goals.
I would compare her to Senator Joe Manchin, the fossil-fuel-friendly West Virginia lawmaker who repeatedly refused to vote for Biden’s climate policy — except at least Manchin put his political reputation on the line when it mattered and ultimately negotiated, and voted for, the Inflation Reduction Act. At least Manchin has many qualities to recommend him: He was canny, risk-taking, proud, and courageous when it counted. Hochul is just a loser.
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Current conditions: For the first time since 1914, the Atlantic hurricane season may pass without any major hurricanes, per an AccuWeather forecast • From Phoenix to Dallas, flood watches are in effect as the remnants of Hurricane Polo stretch inland from the Pacific through the Southwest • Surigae, now upgraded to a “severe” tropical storm, is set to slam into Japan’s Izu Islands, a partially populated archipelago in the same municipality as Tokyo.
The Department of Energy has ordered the release of 40 million barrels of oil from the Strategic Petroleum Reserve as diesel surpasses $6.50 per gallon and Texas proclaims a statewide “disaster” over soaring prices. The move, which Secretary of Energy Chris Wright said would “stabilize the market,” comes as the Trump administration weighs whether to temporarily ban exports of diesel, a radical step that might only slightly lower American prices while sending Europe’s fuel costs skyrocketing, as the chief executive of the continent’s No. 2 oil company cautioned in a Bloomberg interview this week. The oil is expected to be a loan from the stockpile that would, Wright said, ultimately save Americans more than $3 billion. The transaction follows the same approach the Trump administration has taken since agreeing to distribute 172 million barrels from the Strategic Petroleum Reserve back in March, when the war with Iran began. Had the administration instead sold the barrels through an emergency drawdown instead of a trade, as it did previously, and simultaneously structured the deal to allow it to buy back oil at the lower prices the futures market is trading at presently, the Energy Department could have significantly increased its profits. That’s the finding of a policy memo from the think tank Employ America that I told you about a few weeks ago. The profit could, in turn, be used to invest in America’s fuel stockpile, clearing some of the $230 million backlog of physical repairs needed on the infrastructure that stores the crude. “The choice to deliver more barrels is fraught, but with that decision made, the administration missed an opportunity to set up the SPR for long-term success,” Arnab Datta, Employ America’s managing director of policy implementation, told me in a text message last night. “I hope they consider creative options to do so moving forward.”
Meanwhile, oil is actually flowing through the Strait of Hormuz again. “Iran’s regime has lost control of the Strait of Hormuz,” energy investor Alexander Stahel wrote in a lengthy post on X. The U.S. military’s naval escorts and the United Arab Emirates’ commitment to circumventing Iran’s blockade are returning the critical waterway to “normal,” as my colleague Robinson Meyer wrote. Over text message last night, I asked an energy trader if this meant we were winning. “I’d say we’re losing less than we had been,” they said. “If Iran hadn’t gotten the Houthis to attack Saudi Arabia and seize the Red Sea, we’d definitely be.” Big if!
British Prime Minister Andy Burnham emerged triumphant from the Labour Party’s recent political implosions after he established himself as a pragmatic left-wing populist during his time as mayor of Manchester — drawing frequent comparisons to New York City Mayor Zohran Mamdani. Now Burnham is demonstrating what his brand of “business-friend socialism” means in energy. On Tuesday, Downing Street announced the launch of Great British Grid, a new subsidiary of the state-owned Great British Energy, designed to compete with private companies for investments in the power grid. “We have a cost crisis. We all know it,” Burnham said in a speech, according to The Guardian, which broke news of GB Grid. “The price of energy is crippling for businesses, and British bill payers pay some of the highest energy costs in Europe. We have an energy system where prices are dictated in markets miles away, while families and businesses here shoulder the costs. Once again, the British public has lost control.” His answer? Reverse what he called “40 years of neoliberalism.” Over here on this side of the pond, we are waiting to see what’s in the deal the Senate has brokered to ease federal permitting, one of many hurdles to building new transmission lines in America. The text of the agreement is due out later today.
Down in the South Atlantic, things are heating up in the Falkland Islands, even as temperatures outside remain low. The archipelago has never had a native population — as far as anyone can tell, the longest-lasting settled population has been the mostly British herders and fishers who have voted repeatedly to stay under the British crown. That didn’t stop Argentina, which has claimed what it calls Las Malvinas for centuries, from launching an invasion in 1983, in which the British military won a decisive victory. Now that the sleepy Falklands are preparing to drill oil wells in the offshore economic zone surrounding the islands, Buenos Aires is waging what one Falklander described to the Financial Times as “economic warfare.” Instead of Union Jacked Sea Harriers and Argentinian light cruisers doing the combat, this time Argentina is limiting trade, isolating the Falklands. “We’re just a few thousand people trying not to get blown off a rock,” local radio host Ronnie MacLennan Baird told the newspaper. “We just want to get on with our lives.”

Lots of solar developers are promising to compete with nuclear, geothermal, and hydro plants in generating the type of electricity that matches today’s favored buzzwords of “24/7,” “clean,” and “baseload” by pairing panels with batteries. Few companies, for obvious reasons, actually mean generating solar energy all day and night. Virtus Solis Technology, on the other hand, is promising to pioneer a method for delivering solar power generated from panels affixed to satellites in space, capable of angling at every hour to meet the sun’s rays and beaming wireless power back down to Earth. It’s hardly the only developer reaching for solar in space. But the Troy, Michigan-based startup is the first to get someone to agree to buy that electricity. On Wednesday, the company inked its first power purchase agreement to sell electricity from its debut, 100-megawatt solar satellite to the Chicago-based data center developer Brae Systems over the next 20 years. Virtus Solar called it the “first in a series of commercial offtake agreements” expected in the next several months. As part of the deal, Virtus Solar will build a “dedicated terrestrial receiving station to be constructed in Illinois.” The contract includes an option to increase capacity to 250 megawatts within three years of commercial operations. “Securing a direct 20-year supply of firm, clean power from Virtus Solis ensures our GPU infrastructure operates with predictable power costs and zero carbon emissions, completely insulated from terrestrial grid curtailment,” Brae Systems CEO Vishnu Indukuri said in a statement.
Other frontier energy sources have evolved quickly from plans to deals. Commonwealth Fusion Systems, the current frontrunner in America’s fusion startup race, signed its inaugural power purchase agreement with Google last year. Now the spinout from the Massachusetts Institute of Technology is attracting institutional investors, as my colleague Katie Brigham has written, and inching closer to building out its supply chain. On Wednesday morning, the company announced what it called a “landmark supply agreement” with the Japanese industrial giant Fujikura to buy more than 6,200 miles of high-temperature superconducting tape to help build CFS’ doughnut-shaped ARC fusion reactors.
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As of now, the European Union is set to start forcing foreign oil and gas companies to monitor and submit data on their methane emissions or face financial penalties. But Brussels is now considering delaying the methane reporting rules by as much as a year as tight fuel supplies send prices ever higher amid the twin energy shocks from the wars in Iran and Ukraine. On Tuesday, Reuters and OilPrice.com reported that EU Energy Commissioner Dan Jorgensen had confirmed that officials are examining whether to postpone the provisions. The statement came days after Jorgensen made a similar remark to Bloomberg.
Meanwhile, Jorgensen’s native Denmark is heeding the former U.S. Energy Secretary Ernie Moniz’s call to invest more in clean fuels. On Tuesday, Hydrogen Insight reported that the country planned to increase its budget for building a network of dedicated hydrogen pipelines by $850 million.
One of the more memorable moments of the 2024 vice presidential debate came when JD Vance lashed his Democratic rival, Minnesota Governor Tim Walz, for failing to prioritize manufacturing of solar panels in the U.S. The Democrat shot back that such factories were open in his very state. Among them was Heliene, a producer of high-performance solar modules designed for boutique rooftop units. On Tuesday, the company rolled out a new all-American module at a moment when solar buyers are increasingly seeking technology that won’t be subject to President Donald Trump’s tariffs. “The new module brings together American-made polysilicon, ingots, wafers, and solar cells, reconnecting critical stages of the solar supply chain with U.S. manufacturing after more than a decade,” the company said, calling the module “an important step in reshoring U.S. solar manufacturing, bringing more of the upstream silicon supply chain back to America.”
As my colleague Emily Pontecorvo and I reported last month, the Department of Commerce just threw solar manufacturers a lifeline by slapping new import levies and restrictions on foreign polysilicon, the main ingredient in solar panels. But the agency halted enforcement until early December, giving importers the opportunity to stockpile in advance of the new rules taking effect. Last week, the Commerce Department moved to ban stockpiling. “Protecting against stockpiling is critical to ensure a functionally viable remedy from the Section 232 rules,” Matt Card, president of the U.S. cell manufacturer Suniva, told PV Tech.
A quick letter of recommendation to close out this morning’s newsletter. Back in 2018, I received a galley copy of a forthcoming book by a niche left-wing sociologist with a growing focus on climate change. The title — After Geoengineering: Climate Tragedy, Repair, and Restoration — struck me. Geoengineering and its associated technological ideas to adapt to a hotter world, such as carbon dioxide removal, were at that point very taboo in climate policy circles. The technology, assuming it even worked, posed what many saw as a moral hazard, a Pandora’s box that, if opened, would sap humanity’s collective will to do the hard work of mitigating fossil fuel emissions. At least, that was the dominant mode of thinking at the time. So, you can imagine, I found that book title provocative. Over the course of 288 pages, the author, Holly Jean Buck, bounced between dense but readable chapters of nonfiction explanations of the latest science behind various cutting-edge climate technologies and sections of fictional sci-fi vignettes. The stories painted a picture of life in the not-so-distant future. One that has stuck with me over the years is a vision of an Oklahoma rancher earning passive income by letting a state carbon disposal program pump captured CO2 into the geological formations beneath his property. I offer my sincere congratulations to Holly, who yesterday was named among the 20 recipients of this year’s MacArthur Foundation’s prestigious “genius grant.”
Novele is aiming to smooth out power consumption for commercial buildings, saving tenants money and easing grid strain.
Electricity is more expensive in times of peak demand — that’s simply a universal truth. But for many commercial building owners and tenants, their most energy-intensive minutes of the month can have an especially outsized impact on their electricity bill. That’s because of the “demand charge,” a fee based on a building’s single highest burst of power consumption, which can make up over 50% of a customer’s monthly bill. Likewise, shrinking those bursts would not only ease strain on the grid, but could also dramatically lower commercial users’ costs.
Or at least that’s Novele’s pitch. The startup, which makes 2-inch-thick, fire-safe lithium-ion batteries that mount on the interior walls of commercial spaces such as offices, hospitals, and big box retailers, announced Wednesday that it raised an oversubscribed $17 million Series A led by impact-focused investor Boisei Labs. The funding will help the company scale its AI-powered battery system, which networks batteries placed throughout a building and uses software to predict impending spikes in power demand. Just before the peak hits, the system can automatically switch the building from grid power to battery power, helping the customer avoid those costly demand charges.
“We learn how the building consumes power, but we’re also taking into account other considerations, like what day of the week it is, how the building is occupied, when it’s being used, what’s happening with the weather conditions,” Novele’s co-founder and CEO Charles Conwell told me.
Of course, battery storage for commercial customers is nothing new. Tesla, for one, has long sold large batteries like its Megapack, along with software designed to help businesses manage and reduce peak demand. But unlike these larger outdoor systems, Novele designed its thin panels for installation inside occupied spaces like hospital hallways and offices, distributing the batteries throughout a building while operating them as a single, coordinated system.
The systems are custom designed, so Novele told me it couldn’t provide an overall cost estimate. But Conwell told me the batteries typically have a 20- to 40-month payback period, the timeframe in which a customer’s electricity bill savings should eclipse the system’s upfront cost. (The company also offers financing options that allow customers to spread out that cost over time.) And while customers may sign up for the cost savings, there are major decarbonization benefits, too. So-called peak-shaving can reduce the need for peaker plants — natural gas facilities that only fire up when demand is highest. These plants are typically among the grid’s most carbon-intensive assets, as they’re designed to ramp up quickly rather than operate efficiently for long periods.
These automated batteries could also enable commercial buildings to participate in virtual power plant programs, which ease strain on the grid by cutting energy use during periods of high demand or by tapping assets like batteries to send power back to the grid. Using stored energy when needed, Conwell explained, is better than typical demand response initiatives, which often require tenants to change their routines — e.g. when they run the dishwasher or charge an EV — to accommodate the grid. That approach, he said, is either “ineffective or doesn’t make the tenants very happy.”
As the company scales, it also envisions building a portfolio of properties that, if they have “a dense enough footprint,” could work in concert to form their own virtual power plant of sorts, Conwell said.
In the near term, however, Novele plans to use its Series A to expand its team, install more systems, and further develop its software. It’s particularly focused on markets where electricity costs are already high or climbing fast, such as California, New York, New England, and parts of the PJM power market. In PJM in particular, record-high capacity prices — largely driven by data center demand — are pushing electricity bills to new heights.
The company says it has already installed batteries for several Fortune 50 customers, though it’s keeping the identities of these early adopters under wraps. Conwell told me that there’s also “a bunch of installations that are in progress,” and that in the coming year, the company will be working toward making the process of purchasing, installing, and operating Novele’s system as seamless as possible.
Once that foundation is in place, Conwell sees an opportunity to help usher in a more responsive, intelligent future for the built environment. “If you get the infrastructure right, if you bring in the controls — the mechanical controls, the machine learning controls, and the artificial intelligence-driven controls — you start to be able to set the stage for a dynamic, autonomous building of the future.”
The former vice president of the United States joined us at Heatmap House for New York Climate Week.
Former Vice President Al Gore needs no introduction. He is, in a way, the original climate influencer. His film An Inconvenient Truth gave rise to a new wave of climate activism in the 2000s. It was one of the highest-grossing documentaries of all time upon its release, and it won an Oscar, a Grammy, and — for Vice President Gore — a Nobel Peace Prize.
He’s remained active in climate policy since then and leads the Climate Reality Project. He is also an investor and was a longtime director at Apple.
For this episode of Shift Key, Vice President Gore joined Rob for a live conversation at our Heatmap House event, part of New York Climate Week. He reflected on the 20th anniversary of An Inconvenient Truth, the existential risk of artificial intelligence, and what has surprised him most about the evolution of climate politics.
Shift Key is hosted by Robinson Meyer, the founding executive editor of Heatmap News.
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Here is an excerpt from their conversation:
Robinson Meyer: Let’s start by talking about 20 years ago, because 20 years ago, An Inconvenient Truth came out. I recently had cause to revisit the film, and I actually have to confess something. I was very excited when the movie came out, but I don’t think I’ve ever admitted this, and maybe this is the wrong audience to do it to: I was too stressed about climate change to actually watch it. Not that it was a daily anxiety, but I was like, “I can’t. There’s so many other things.” And so I actually watched it for the first time only recently.
I had the book, let’s be clear. I had the book.
Al Gore: A limited confession.
Meyer: Yeah, yeah. It was so fascinating watching it 20 years on, because there are some sections of it that I think you could give today. Not that little has changed — the science hasn’t, of course — but the way people think about it, the way people move from denial to doom, hasn’t changed in some ways. I wondered what surprised you most about the intervening 20 years since the film came out. It received a response that, I don’t know what you were anticipating, but it was certainly on a scale beyond what was expected at the time. And then there’s where we are today.
Gore: Well, when Laurie David first made the suggestion, here in this city, I gave an early version of my slideshow when we were promoting that movie. What was it, The Day After —
Meyer: The Day After Tomorrow?
Gore: The Day After Tomorrow. Was that it? Yeah. And they said, “Well, that’s fiction, isn’t it?” And I said, “Well, it’s not as fictional as the then-current administration was about climate.” But when she said, “This needs to be made into a movie,” I said, “You’re crazy.” As one of the early reviewers said, “Al Gore giving a slideshow — what part of that doesn’t scream hit?” So I was a skeptic about the enterprise, and I was surprised at the reception it got.
Really, the credit belongs to the scientists I was just channeling. The fact that everything they predicted has proven to be basically spot on is a credit to them. For the rest of us, the fact that they were so right then should cause us to pay more attention to what they’re warning us about now.
As for what has surprised me, it’s the ferocity and durability and massive continued financing of climate denial by the fossil fuel industry. There was a time during these last 20 years when they said they were going to be part of the solution, and a couple of them made some good-faith efforts in that direction. But then, like Steve Martin on the old SNL, they went, “Nah.” They decided just to give up the ghost and go full speed ahead on more and more fossil fuels. I think they’re losing as we are winning, but they’re hanging in there.
You can find a full transcript of the episode here.
Mentioned:
Previously on Shift Key: Energy Secretary Chris Wright on Trump’s Pro-Nuclear, Pro-Fossil Fuel Agenda
This episode of Shift Key is sponsored by ...
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Music for Shift Key is by Adam Kromelow.