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Sweltering heat and earlier sunsets are a big problem for solar power.
The biggest problem in renewable energy goes by a few names.
Classically, it’s called the “duck curve,” which shows the relationship between solar generation and how much power the rest of the grid uses during the day. At the bottom of the curve, typically around midday, solar can sometimes generate 100% of the power demanded from the grid. But as the sun traces its arc towards the horizon, solar power generation falls and then quickly goes to zero as the sun sets. Often, temperatures and electricity use remains high, especially as people come home from work and start using home appliances, meaning non-solar sources of power must quickly come on line to fill in the gap.
It’s not a coincidence that utilities and grid operators tend to ask consumers to conserve in the later afternoon or evening. The phenomenon is classically associated with solar-heavy California, but it has come to Texas as well, where it goes by the name of the “Armadillo Curve” or the “Dead Armadillo Curve.”
But the relation between the sun and the Earth doesn’t just create darkness and light on daily scales but on annual ones as well. Yes, I know this isn’t breaking news, but it’s important, especially as the power system and climate are changing.
Right now we might be in the neck of the annual duck curve.
In case you haven’t noticed, the sun is setting earlier and it’s still really hot out. Kids are going back to school while much of the country is still facing summer temperatures.
In New York City this week, high temperatures are forecast to get into the 90s, while the sun will set before 7:30; in Washington, D.C., forecast highs are over 100 later this week with a sunset just past 7:30; in Houston, daytime highs to get over 100 later this week, with the sun setting before 7:40; and in Los Angeles , sunsets are at around 7:15 with expected daytime highs in the 90s this weekend.
And Septembers are only getting hotter. Septembers 2021 and 2022 were tied for the fifth hottest on record for the last 143 years, according to the National Oceanic and Atmospheric Administration; 10 of the hottest Septembers have occurred since 2012. The warmest was in 2020.
These higher temperatures mean prolonged periods of high electricity usage, even as one resource — solar — becomes less potent. This matters because, at least in the United States, we tend to organize our lives — and our electricity usage — around the clock, not the sun.
As the sun is setting earlier, our high electricity usage stretches longer compared to the length of the solar day, exacerbating the duck curve dynamics inherent to solar power. A dishwasher that runs when the sun’s still up in July is pulling the same power from the grid as one that runs during fall’s early twilight. The saving grace of shorter days in a grid that uses solar power is supposed to be that air conditioning usage goes down, but that doesn’t happen when summer temperatures persist past Labor Day.
If hot Septembers and even Octobers become the norm, grid conditions could tighten up both during and across the days, with higher cost, less reliable power or increased usage of fossil fuels to fill in the gap.
These longer, hotter summers can make operating electric grids more difficult. ERCOT, the electricity market that covers the vast majority of Texas, restricts power plants from having planned outages between May 15 and September 15 for maintenance. While still in the summer restriction window, ERCOT on Tuesday issued an alert for later this week, warning of “forecasted higher temperatures, higher electrical demand, and the potential for lower reserves.” If ERCOT extends its restrictions on outages for maintenance, there should be more unplanned outages, making power scarcer, meaning higher prices and a greater possibility of blackouts.
Not every country sees peak electricity usage in late summer. In New England, peak electricity demand tends to hit in July. In the sprawling PJM Interconnection last year, the electricity market that spans from the Chicago area to Virginia, demand peaks tended to be in June or August. In New York, peak demand is often in July.
But summer peaks are later in the year in two the country's largest electricity markets: California and Texas.
The Texas energy market had hit its peak day in July in 2022, but it moved out to August this year. And Texas is already bursting through its September demand records. It reached over 78,000 megawatts in just the first week of this month, well over its previous record of 72,370 megawatts, which it set in 2021.
And California hit its power demand record last September amidst a heat wave that covered much of the western United States.
It’s not just there being literally fewer hours of sunlight that drags down solar production later in the year, but also the lower angle of the sun. “As the sun gets lower in the sky we see solar production numbers will drop,” Joshua Rhodes, a senior research scientist at the University of Texas, told me.
“As the sun is lower in the sky it’s up fewer hours ... the photons are coming in at a steeper angle, the panels are not going to get as much light. Even when the sun is at the highest point of the day, the panels are not getting the same level of irradiance as when the sun is at the highest point of the day [at other times of year].”
The best angle for solar panels can change around 15 degrees a year, depending on the year and solar panels are more efficient when they can track the sun during the day. Most homeowners who install solar panels won’t have tracking technology, while utility-scale solar developers are more likely to. This means that a state like Texas, whose renewable mix is more focused on large solar arrays, could see less dramatic drop-offs in solar power throughout the day or throughout the year than a state like California, which has more residential solar.
A roof-mounted four kilowatt-hour solar PV system with standard specs where I grew up in Northern California would get 7.45 kilowatts-hours per meter squared per day in July, generating 689 kilowatt-hours of power, according to National Renewable Energy Laboratory PVWatts tool; in September, solar radiation would drop down to 6.6 kilowatt-hours per meter squared per day and 587 kilowatt-hours per month.
This admittedly basic math suggests it's possible California could struggle this month — and in future Septembers — with meeting electricity demand.
In the past 10 years, California’s annual load peak has occurred in September five times, with the peak loads in 2022 and 2021 occurring on September 6 and 8 respectively.
This year has been, so far, not particularly stressful for the Golden State’s grid thanks to some good luck — no region-wide, prolonged heat waves that max out California’s grid and make imports scarce, mild temperatures on the coasts where the state’s population is concentrated, no major wildfires, and plentiful hydro power thanks to massive snowfall this past winter — as well as massive deployment of batteries across the grid. The batteries especially can help alleviate these duck curve dynamics, as they essentially redistribute power from the sunniest part of the day to the evenings.
While Texas set several new records this year in electricity usage, California has stayed well short of its 52,000 megawatt record last September. California set records for solar power in June and July, with almost 16,000 megawatts, while total demand over 40,000 megawatts.
“While we haven’t seen substantial stress on the grid this summer, we haven’t been fully tested. If we got the kind of west-wide heat we experienced in September 2022, we could need to tap into the state’s emergency or strategic reserves again,” Anne Gonzales, a spokesperson for the California Independent System Operator, told me in an email.
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Tax credit transferability is a wonky concept, but it’s been a superpower for clean energy developers.
One of the most powerful innovations in the Inflation Reduction Act was a new vehicle to finance clean energy projects. In addition to expanding the nation’s tax credits for climate-friendly projects, Congress gave developers freedom to sell these credits for cash. If a battery factory couldn’t take full advantage of the tax credits itself, it could transfer them to someone else who could.
Now, Republicans on the House Ways and Means Committee have proposed getting rid of this “transferability” provision as part of a larger overhaul of the tax credits. A draft bill published on Monday would end the practice starting in 2028.
Nixing transferability isn’t the bill’s most damaging blow to clean energy — new sourcing requirements for the tax credits and deadlines that block early-stage projects pose a bigger threat. But the ripple effects from the change would permeate all aspects of the clean energy economy. At a minimum, it would make energy more expensive by making the tax credits harder to monetize. It would also all but shut nuclear plants out of the subsidies altogether.
Prior to the passage of the Inflation Reduction Act, if renewable energy developers with low tax liability wanted to monetize existing tax credits, they had to seek partnerships with tax equity investors. The investor, usually a major bank, would provide upfront capital for a project in exchange for partial ownership and a claim to its tax benefits. These were complicated deals that involved extensive legal review and the formation of new limited liability corporations, and therefore weren’t a viable option for smaller projects like community solar farms.
When the 2022 climate law introduced transferability across all the clean energy tax credits, it simplified project finance and channeled new capital into the clean energy economy. Suddenly, developers for all kinds of clean energy projects could simply sell their tax credits for cash on the open market to anyone that wanted to buy them, without ceding any ownership. The tax credit marketplace Crux estimated that a total of $30 billion in transfers took place last year, only about 30% of which were traditional tax equity deals. In the past, tax equity transfers have topped out at around $20 billion per year.
Schneider Electric, which has long helped corporate clients make power purchase agreements, now facilitates tax credit transfers, as well. The company recently announced that it had closed 18 deals worth $1.7 billion in tax credit transfers since late 2023. The buyers were all new to the market — none had directly financed clean energy before the IRA, Erin Decker, the senior director of renewable energy and carbon advisory services, told me.
It turns out, buying clean energy tax credits is a win-win for brands with sustainability commitments, which can reduce their tax liability while also helping to reduce emissions. Some companies have even used the savings they got through the tax credits to fund decarbonization efforts within their own operations, Decker said.
By simplifying project finance, and creating more competition for tax credit sales, transferability also made developing renewable energy projects cheaper. Developers of wind and solar farms have been able to secure upwards of 95 cents on the dollar for transferred tax credits, compared to just 85 to 90 cents for tax equity transactions. The savings go directly to utility customers.
“State regulators require electric companies to pass the benefits of tax credits through to customers in the form of lower rates,” the Edison Electric Institute wrote in a policy brief on the provision. “If transferability were repealed, electric companies once again would rely on big banks to invest in tax equity transactions, ultimately reducing the value of the credit that flows directly through to customers.”
Many of the companies that can’t count on tax equity deals will still have other options under the GOP proposal. Tax-exempt entities, like rural electric cooperatives and community solar nonprofits, can use “elective pay,” another IRA innovation that allows them to claim the credits as a direct cash payment from the IRS. For-profit companies developing carbon capture and advanced manufacturing projects also have the option to use elective pay for the first five years they operate. All of this raises questions about whether axing transferability would furnish the government with meaningful savings to offset Trump’s tax cuts.
But the bigger danger for Trump would be his nuclear agenda. Prior to the IRA, low power prices meant that many nuclear operators couldn’t afford to extend the licenses on their existing plants, even ones that had many years of useful life left in them. The IRA created a new tax credit for existing nuclear plants that made it economical for operators to invest in keeping these online, and even helped bring some, like the Palisades plant in Michigan, back from the dead.
This wouldn’t have worked without transferability, Benton Arnett, the senior director of markets and policy at the Nuclear Energy Institute, told me. Going forward, finding a tax equity partner would be nearly impossible because of the unique rules governing nuclear plants. Federal regulations require that the owners of a nuclear power plant be listed on its license, so bringing on a new owner means doing a license amendment — a headache-inducing process that banks simply don’t want to take on. “We’ve had members reach out to tax equity groups in the past and there was very little interest,” Arnett said
While a few plant owners might have enough tax appetite to benefit from credits directly, most have depreciating assets on their books that greatly reduce their liability. “Without transferability, for many of our members, it’s very difficult for them to actually monetize those credits,” said Arnett. “In a way, nuclear is disproportionately impacted by removing that ability to transfer.”
In February, Secretary of Energy Chris Wright declared that “the long-awaited American nuclear renaissance must launch during President Trump’s administration.” But so far on Trump’s watch, between the proposed loss of transferability and early phase-out of nuclear tax credits, plus cuts to loan programs at the Department of Energy, we’ve only seen policies that would kill the nuclear renaissance.
On Trump’s Gulf trip, budget negotiations, and a uranium mine
Current conditions: Highs in Dallas, San Antonio, and Austin could break 100 degrees Fahrenheit on Wednesday afternoon, with ERCOT anticipating demand could approach August 2023’s all-time high of 85,500 megawatts • Governor Tim Walz has called in the National Guard to respond to three fires in northern Minnesota that have burned 20,000 acres and are still 0% contained• The coldest place in the world right now is the South Pole of Antarctica, which could drop to -70 degrees tomorrow.
Win McNamee/Getty Images
The White House on Tuesday announced a $600 billion investment commitment from Saudi Arabia during President Trump’s trip to the Gulf. In exchange, the U.S. offered Riyadh “the largest defense cooperation agreement” Washington has ever made, with an arms package worth nearly $142 billion, Reuters reports. The deals announced so far by the White House total just $283 billion, although the administration told The New York Times that more would be forthcoming.
Among the known commitments in the health and tech sectors, the U.S. also reached a number of energy deals with Saudi Arabia’s state-owned oil company, Aramco, which agreed to a $3.4 billion expansion of the Motive refinery in Texas “to integrate chemicals production,” OilPrice.com reports. Aramco additionally signed “a memorandum of understanding with [the U.S. utility] Sempra to receive about 6.2 million tons per year of LNG.” (Aramco is responsible for over 4% of the planet’s CO2 emissions, according to the think tank InfluenceMap, and would be the fourth largest polluter after China, the U.S., and India, if it were its own country.) Additionally, Saudi company DataVolt committed to invest $20 billion in AI data centers and energy infrastructure in the U.S.
Senate Republicans are reportedly putting the brakes on the House Ways and Means Committee’s proposal to overhaul the nation’s clean energy tax credits and effectively kill the Inflation Reduction Act. “[S]ome Senate Republicans say abruptly cutting off credits and changing key provisions that help fund projects more quickly could stifle investments in energy technologies needed to meet growing power demand, and lead to job losses for manufacturing and electricity projects in their states and districts,” Politico reports. North Dakota’s Republican Senator John Hoeven, for one, characterized the Ways and Means’ plan as a “starting point,” with “some change” expected before agreement is reached.
As my colleague Emily Pontecorvo reported earlier this week, the House proposal “appears to amount to a back-door full repeal” of the IRA, including cutting the EV tax credit, moving up the phase-out of tech-neutral clean power, and eliminating credits for energy efficiency, heat pumps, and solar. But as she noted then, “there’s a lot that could change before we get to a final budget” — especially if Republican senators follow through on their words.
The Interior Department plans to expedite permitting for a uranium mine in Utah, conducting an environmental assessment that typically takes a year in just 14 days, The New York Times reports. Interior Secretary Doug Burgum said the fast-track addressed the “alarming energy emergency because of the prior administration’s Climate Extremist policies.” Notably, Burgum also recently issued a stop-work order on Equinor’s fully permitted Empire Wind offshore wind project, claiming the project’s permitting process had been rushed under former President Joe Biden. That process took nearly four years, according to BloomberNEF.
Critics of the Velvet-Wood project in San Juan County, Utah, said the Interior Department is leaving no opportunity for public comment, and that there are concerns about radioactive waste from the mining activities. Uranium is a fuel in nuclear power plants, and its extraction falls under President Trump’s recent executive order to address the so-called “national energy emergency.”
Clean energy investment saw a second quarterly decline at the start of 2025, but nevertheless accounted for 4.7% of total private investment in structures, equipment, and durable consumer goods in the first quarter of the year, a new report by the Rhodium Group’s Clean Investment Monitor found. Among some of its other notable findings:
You can read the full report here.
A Dutch environmental group is suing oil giant Shell, arguing that the company is in violation of a court order to make an “appropriate contribution” to the goals of the Paris Climate Agreement, France 24 reports. Amsterdam-based Milieudefensie previously won an historic precedent against Royal Dutch Shell in 2021, with the court ruling the company had to cut its carbon emissions by 45% of 2019 levels by 2030 because its investments in oil and gas were “endangering human rights and lives.” Shell appealed the decision, moved its headquarters to London, and dropped “Royal Dutch” from its name; subsequently, a Dutch appeals court sided with Shell and reversed the 45% emissions reduction target, while still insisting the company had a responsibility to lower its emissions, Inside Climate News reports.
Now, Milieudefensie is suing, claiming Shell is in breach of its obligation to reduce emissions due to its “continued investment in new oil and gas fields and its inadequate climate policy for the period 2030 to 2050.” Sjoukje van Oosterhout, a lead researcher on the Shell case for Milieudefensie, said in a press conference, “The impact of this case could really be enormous. Science is clear, crystal clear, and the ruling of the appeals court was also clear. Every new field is one too many. That’s why we have this case today.”
AstraZeneca
UK regulators this week approved the use of AstraZeneca’s new medical inhaler, which uses a propellant with 99.9% lower global warming potential than those currently in use. The U.S. Environmental Protection Agency has estimated that the discharge and leakage of planet-warming hydrofluoroalkane propellants from inhalers was responsible for 2.5 million metric tons of CO2 equivalents in 2020, or about the same emissions as 550,000 passenger vehicles driven for one year.
Tuesday’s encouraging inflation data concealed an ominous warning sign.
The Trump administration’s policy of increased natural gas exports abroad, plus increased industrial and artificial intelligence investment at home, plus cuts to green energy tax credits could add up to more energy price volatility for Americans.
On Monday, the House Ways and Means Committee unveiled its plan for deep cuts to the Inflation Reduction Act, including early expiration dates and restrictions on the core clean energy tax credits that would effectively gut America’s signature climate law.
But Tuesday’s good news about inflation also contained a troubling omen for electricity prices.
Overall, prices are rising at their slowest rate in years. The Bureau of Labor Statistics reported that overall prices have risen 2.3% in the past year, the slowest annual increase since February 2021. But electricity prices were up 0.8% just in the past month, and were up 3.6% over last year.
This is likely due in part to rising natural gas prices, as natural gas provides the better part of American electricity generation.
The benchmark Henry Hub spot price for natural gas was $3.26 per million British thermal unit last week,according to the latest Energy Information Administration data — around twice the price of a year ago. And there’s reason to think prices for both gas and electricity will continue to rise, or at least be vulnerable to spikes, explained Skanda Amarnath, the executive director of Employ America.
European demand for liquified natural gas has been high recently, which helps pull the American natural gas price closer to a global price, as Europe is a major buyer of U.S. LNG.
During the early years of the shale boom in the 2010s, before the United States had built much natural gas export capacity (the first LNG shipment from the continental United States left Louisiana in early 2016, believe it or not), American natural gas consumers benefited from “true natural gas abundance,” Amarnath told me. “We had this abundance of natural gas and no way for it to get out.”
Those days are now over. The Trump administration has been promoting LNG exports from day one to a gas-hungry global economy. “We’re not the only country that wants natural gas, and LNG always pays a premium,” Amarnath said.
In March, Western European gas imports hit their highest level since 2017, according to Bloomberg. And there’s reason to expect LNG exports will continue at that pace, or even pick up. One of the Trump administration’s first energy policy actions was to reverse the Biden-era pause on permitting new LNG terminals, and Secretary of Energy Chris Wright has issued a number of approvals and permits for new LNG export terminals since.
The EIA last week bumped up its forecast for natural gas prices for this year and next, citing both higher domestic natural gas demand and higher exports than initially expected. And those are in addition to all the structural factors in the United States pulling on electricity demand — and therefore natural gas demand — including the rise in data center development and the boom in new manufacturing.
But we’re in the era of “drill, baby, drill,” right? So all that new demand will be met with more supply? Not so fast.
Increased production of oil overseas — pushed for by Trump — is playing havoc with the economics of America’s oil and gas companies, which are starting tolevel off or even decrease production. The threat of an economic slowdown induced by Trump’s tariffs also influenced some of those decisions, though that fear may have eased with the U.S.-China trade deal announced on Monday.
While it’s the price of oil that largely determines investment decisions for these companies, a consequence can be fluctuations in natural gas production. That’s because much of America’s natural gas comes out of oil wells, so when oil wells go unexploited, natural gas stays in the ground, too.
“A drop in crude oil prices over the past three months has reduced our expectations for U.S. crude oil production growth, and we now expect less associated natural gas production than we did in January,” the EIA wrote last week.
“Together, these factors mean we expect natural gas prices will be higher in order to incentivize production and keep markets balanced.”
At the same time, Republicans in Congress and the Trump administration look to choke off policy support for a boom in renewables investment with their planned dismantling of the Inflation Reduction Act. This means a less diversified grid that will be more reliant on natural gas, Amarnath explained.
When natural gas prices spike, “it’s very useful to have non-gas sources of supply,” Amarnath told me. The alternative fuel can be anything as long as it’s not fossil. It can be solar, it can be wind, it can be nuclear — all three of which would be hammered by the IRA cuts.
What these sources of power do — besides reduce greenhouse gas emissions — is diversify the grid, so that America’s electricity consumers are “not held hostage to what Asian or European LNG buyers want to pay,” Amarnath said.
“The less you rely on a fuel source for electricity, the more stable you are from a price spike. And we’re more at risk now.”