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From what it means for America’s climate goals to how it might make American cars smaller again
The Biden administration just kicked off the next phase of the electric-vehicle revolution.
The Environmental Protection Agency unveiled Wednesday some of the world’s most aggressive climate rules on the transportation sector, a sweeping effort that aims to ensure that two-thirds of new cars, SUVs, and pickups — and one-quarter of new heavy-duty trucks — sold in the United States in 2032 will be all electric.
The rules, which are the most ambitious attempt to regulate greenhouse-gas pollution in American history, would put the country at the forefront of the global transition to electric vehicles. If adopted and enforced as proposed, the new standards could eventually prevent 10 billion tons of carbon pollution, roughly double America’s total annual emissions last year, the EPA says.
The rules would roughly halve carbon pollution from America’s massive car and truck fleet, the world’s third largest, within a decade. Such a cut is in line with Biden’s Paris Agreement goal of cutting carbon pollution from across the economy in half by 2030.
Transportation generates more carbon pollution than any other part of the U.S. economy. America’s hundreds of millions of cars, SUVs, pickups, 18-wheelers, and other vehicles generated roughly 25% of total U.S. carbon emissions last year, a figure roughly equal to the entire power sector’s.
In short, the proposal is a big deal with many implications. Here are seven of them.
Heatmap Illustration/Getty Images
Every country around the world must cut its emissions in half by 2030 in order for the world to avoid 1.5 degrees Celsius of temperature rise, according to the Intergovernmental Panel on Climate Change. That goal, enshrined in the Paris Agreement, is a widely used benchmark for the arrival of climate change’s worst impacts — deadly heat waves, stronger storms, and a near total die-off of coral reefs.
The new proposal would bring America’s cars and trucks roughly in line with that requirement. According to an EPA estimate, the vehicle fleet’s net carbon emissions would be 46% lower in 2032 than they stand today.
That means that rules of this ambition and stringency are a necessary part of meeting America’s goals under the Paris Agreement. The United States has pledged to halve its carbon emissions, as compared to its all-time high, by 2020. The country is not on track to meet that goal today, but robust federal, state, and corporate action — including strict vehicle rules — could help it get there, a recent report from the Rhodium Group, an energy-research firm, found.
Heatmap Illustration/Getty Images
Until this week, California and the European Union had been leading the world’s transition to electric vehicles. Both jurisdictions have pledged to ban sales of new fossil-fuel-powered cars after 2035 and set aggressive targets to meet that goal — although Europe recently watered down its commitment by allowing some cars to burn synthetic fuels.
The United States hasn’t issued a similar ban. But under the new rules, its timeline for adopting EVs will come close to both jurisdictions — although it may slightly lag California’s. By 2030, EVs will make up about 58% of new vehicles sold in Europe, according to the think tank Transportation & Environment; that is roughly in line with the EPA’s goals.
California, meanwhile, expects two-thirds of new car sales to be EVs by the same year, putting it ahead of the EPA’s proposal. The difference between California’s targets and the EPA’s may come down to technical accounting differences, however. The Washington Post has reported that the new EPA rules are meant to harmonize the national standards with California’s.
Heatmap Illustration/Getty Images
With or without the rules, the United States was already likely to see far more EVs in the future. Ford has said that it would aim for half of its global sales to be electric by 2030, and Stellantis, which owns Chrysler and Jeep, announced that half of its American sales and all its European sales must be all-electric by that same date. General Motors has pledged to sell only EVs after 2035. In fact, the EPA expects that automakers are collectively on track for 44% of vehicle sales to be electric by 2030 without any changes to emissions rules.
But every manufacturer is on a different timeline, and some weren’t planning to move quite this quickly. John Bozella, the president of Alliance for Automotive Innovation, has struck a skeptical note about the proposal. “Remember this: A lot has to go right for this massive — and unprecedented — change in our automotive market and industrial base to succeed,” he told The New York Times.
The proposed rules would unify the industry and push it a bit further than current plans suggest.
Heatmap Illustration/Getty Images
The EPA’s proposal would see sales of all-electric heavy trucks grow beginning with model year 2027. The agency estimates that by 2032, some 50% of “vocational” vehicles sold — like delivery trucks, garbage trucks, and cement mixers — will be zero-emissions, as well as 35% of short-haul tractors and 25% of long-haul tractor trailers. This would save about 1.8 billion tons of CO2 through 2055 — roughly equivalent to one year’s worth of emissions from the transportation sector.
But the proposal falls short of where the market is already headed, some environmental groups pointed out. “It’s not driving manufacturers to do anything,” said Paul Cort, director of Earthjustice’s Right to Zero campaign. “It’s following what’s happening in the market in a very conservative way.”
Last year, California passed rules requiring 60% of vocational truck sales and 40% of tractors to be zero-emissions by 2032. Daimler, the world’s largest truck manufacturer, has said that zero emissions trucks would make up 60% of its truck sales by 2030 and 100% by 2039. Volvo Trucks, another major player, said it aims for 50% of its vehicle deliveries to be electric by 2030.
Heatmap Illustration/Getty Images
One of the more interesting aspects of the new rules is that they pick up on a controversy that has been running on and off for the past 13 years.
In 2010, the Obama administration issued the first-ever greenhouse-gas regulations for light-duty cars, SUVs, and trucks. In order to avoid a Supreme Court challenge to the rules, the White House did something unprecedented: It got every automaker to agree to meet the standards even before they became law.
This was a milestone in the history of American environmental law. Because the automakers agreed to the rules, they were in effect conceding that the EPA had the legal authority to regulate their greenhouse-gas pollution in the first place. That shored up the EPA’s legal authority to limit greenhouse gases from any part of the economy, allowing the agency to move on to limiting carbon pollution from power plants and factories.
But that acquiescence came at a cost. The Obama administration agreed to what are called “vehicle footprint” provisions, which put its rules on a sliding scale based on vehicle size. Essentially, these footprint provisions said that a larger vehicle — such as a three-row SUV or full-sized pickup — did not have to meet the same standards as a compact sedan. What’s more, an automaker only had to meet the standards that matched the footprint of the cars it actually sold. In other words, a company that sold only SUVs and pickups would face lower overall requirements than one that also sold sedans, coupes, and station wagons.
Some of this decision was out of Obama’s hands: Congress had required that the Department of Transportation, which issues a similar set of rules, consider vehicle footprint in laws that passed in 2007 and 1975. Those same laws also created the regulatory divide between cars and trucks.
But over the past decade, SUV and truck sales have boomed in the United States, while the market for old-fashioned cars has withered. In 2019, SUVs outsold cars two to one; big SUVs and trucks of every type now make up nearly half the new car market. In the past decade, too, the crossover — a new type of car-like vehicle that resembles a light-duty truck — has come to dominate the American road. This has had repercussions not just for emissions, but pedestrian fatalities as well.
Researchers have argued that the footprint rules may be at least partially to blame for this trend. In 2018, economists at the University of Chicago and UC Berkeley argued Japan’s tailpipe rules, which also include a footprint mechanism, pushed automakers to super-size their cars. Modeling studies have reached the same conclusion about the American rules.
For the first time, the EPA’s proposal seems to recognize this criticism and tries to address it. The new rules make the greenhouse-gas requirements for cars and trucks more similar than they have been in the past, so as to not “inadvertently provide an incentive for manufacturers to change the size or regulatory class of vehicles as a compliance strategy,” the EPA says in a regulatory filing.
The new rules also tighten requirements on big cars and trucks so that automakers can’t simply meet the rules by enlarging their vehicles.
These changes may not reverse the trend toward larger cars. It might even reveal how much cars’ recent growth is driven by consumer taste: SUVs’ share of the new car market has been growing almost without exception since the Ford Explorer debuted in 1991. But it marks the first admission by the agency that in trying to secure a climate win, it may have accidentally created a monster.
Heatmap Illustration/Buenavista Images via Getty Images
The EPA is trumpeting the energy security benefits of the proposal, in addition to its climate benefits.
While the U.S. is a net exporter of crude — and that’s not expected to change in the coming decades — U.S. refineries still rely on “significant imports of heavy crude which could be subject to supply disruptions,” the agency notes. This reliance ties the U.S. to authoritarian regimes around the world and also exposes American consumers to wilder swings in gas prices.
But the new greenhouse gas rules are expected to severely diminish the country’s dependence on foreign oil. Between cars and trucks, the rules would cut crude oil imports by 124 million barrels per year by 2030, and 1 billion barrels in 2050. For context, the United States imported about 2.2 billion barrels of crude oil in 2021.
This would also be a turning point for gas stations. Americans consumed about 135 billion gallons of gasoline in 2022. The rules would cut into gas sales by about 6.5 billion gallons by 2030, and by more than 50 billion gallons by 2050. Gas stations are going to have to adapt or fade away.
Heatmap Illustration/Getty Images
Although it may seem like these new electric vehicles could tax our aging, stressed electricity grid, the EPA claims these rules won’t change the status quo very much. The agency estimates the rules would require a small, 0.4% increase in electricity generation to meet new EV demand by 2030 compared to business as usual, with generation needs increasing by 4% by 2050. “The expected increase in electric power demand attributable to vehicle electrification is not expected to adversely affect grid reliability,” the EPA wrote.
Still, that’s compared to the trajectory we’re already on. With or without these rules, we’ll need a lot of investment in new power generation and reliability improvements in the coming years to handle an electrifying economy. “Standards or no standards, we have to have grid operators preparing for EVs,” said Samantha Houston, a senior vehicles analyst at the Union of Concerned Scientists.
The reduction in greenhouse gas emissions from replacing gas cars will also far outweigh any emissions related to increased power demands. The EPA estimates that between now and 2055, the rules could drive up power plant pollution by 710 million metric tons, but will cut emissions from cars by 8 billion tons.
This article was last updated on April 13 at 12:37 PM ET.
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A longtime climate messaging strategist is tired of seeing the industry punch below its weight.
The saga of President Trump’s One Big Beautiful Bill Act contains at least one clear lesson for the clean energy industry: It must grow a political spine and act like the trillion-dollar behemoth it is. And though the logic is counterintuitive, the new law will likely provide an opportunity to build one.
The coming threat to renewable energy investment became apparent as soon as Trump won the presidency again last fall. The only questions were how much was vulnerable, and through what mechanisms.
Still, many clean energy leaders were optimistic that Trump’s “energy abundance” agenda had room for renewables. During the transition, one longtime Republican energy lobbyist told Utility Dive that Trump’s incoming cabinet had a “very aggressive approach towards renewables.” When Democratic Senator John Hickenlooper introduced would-be Secretary of Energy Chris Wright at the fracking executive’s confirmation hearing, he vouched for Wright’s clean energy cred. Even Trump touted Wright’s experience with solar.
At least initially, the argument made sense. After all, energy demand is soaring, and solar, wind, and battery storage account for 95% of new power projects awaiting grid connection in the U.S. In red states like Texas and Oklahoma, clean energy is booming because it’s cheap. Just a few months ago, the Lone Star State achieved record energy generation from solar, wind, and batteries, and consumers there are saving millions of dollars a day because of renewables. The Biden administration funneled clean energy and manufacturing investment into red districts in part to cultivate Republican support for renewables — and to protect those investments no matter who is president.
As a result, for the past six months, clean energy executives have absorbed advice telling them to fly below the radar. Stop using the word “climate” and start using words like “common sense” when you talk to lawmakers. (As a communications and policy strategist who works extensively on climate issues, I’ve given that specific piece of advice.)
But far too many companies and industry groups went much further than tweaking their messaging. They stopped publicly advocating for their interests, and as a result there has been no muscular effort to pressure elected officials where it counts: their reelection campaigns.
This is part of a broader lack of engagement with elected officials on the part of clean energy companies. The oil and gas industry has outspent clean energy on lobbying 2 to 1 this year, despite the fact that oil and gas faces a hugely favorable political environment. In the run up to the last election, the fossil fuel industry spent half a billion dollars to influence candidates; climate and clean energy advocates again spent just a fraction, despite having more on the line. My personal preference is to get money out of politics, but you have to play by the rules as they exist.
Even economically irresistible technologies can be legislated into irrelevance if they don’t have political juice. The last-minute death of the mysterious excise tax on wind and solar that was briefly part of the One Big Beautiful Bill Act was a glaring sign of weakness, not strength — especially given that even the watered-down provisions in the law will damage the economics of renewable energy. After the law passed, the President directed the Treasury Department to issue the strictest possible guidance for the clean energy projects that remain eligible for tax credits.
The tech industry learned this same lesson over many years. The big tech companies started hiring scores of policy and political staff in the 2010s, when they were already multi-hundred-billion dollar companies, but it wasn’t until 2017 that a tech company became the top lobbying spender. Now the tech industry has a sophisticated influence operation that includes carrots and sticks. Crypto learned this lesson even faster, emerging almost overnight as one of the most aggressive industries shaping Washington.
Clean energy needs to catch up. But lobbying spending isn’t a panacea.
Executives in the clean energy sector sometimes say they are stuck between a rock and a hard place. Democrats and the segment of potentially supportive Republicans at the local and federal levels talk and think about clean energy differently. And the dissonance makes it challenging to communicate honestly with both parties, especially in public.
The clean energy industry should recognize that the safest ground is to criticize and cultivate both parties unabashedly. The American political system understands economic self interest, and there are plenty of policy changes that various segments of the clean energy world need from both Democrats and Republicans at the federal and state levels. Democrats need to make it easier to build; Republicans need to support incentives they regularly trumpet for other job-creating industries.
The quality of political engagement from clean energy companies and the growing ecosystem of advocacy groups has improved. The industry, disparate as it is, has gotten smarter. Advocates now bring district-by-district data to policymakers, organize lobby days, and frame clean energy in terms that resonate across the aisle — national security, economic opportunity in rural America, artificial intelligence, and the race with China. That’s progress.
But the tempo is still far too low, and there are too many carrots and too few sticks. The effects of President Trump’s tax law on energy prices might create some leverage. If the law damages renewable energy generation, and thereby raises energy prices as energy demand continues to rise, Americans should know who is responsible. The clean energy sector has to be the messenger, or at least orchestrate the messaging.
The campaigns write themselves: Paid media targeting members of Congress who praised clean energy job growth in their districts and then voted to gut jobs and raise prices; op-eds in local papers calling out that hypocrisy by name; energy workers showing up at town halls demanding their elected officials fight for an industry that’s investing billions in their communities; activating influencers to highlight the bright line between Trump’s law and higher electricity bills; and more.
If renewable energy is going to grow consistently in America, no matter which way the political wind blows, there must be a political cost to crossing the sector. Otherwise it will always be vulnerable to last-minute backroom deals, no matter how “win-win” its technology is.
On IRA funds, rescissions, and EV battery technology
Current conditions: The National Weather Service is advising Americans in 11 states affected by heat waves to avoid coffee and alcohol due to dehydration risk • There have been more wildfires in London this summer than in all of 2024 • We’re at the halfway point in climatological summer and the United States’ hottest day of the year — 124 degrees Fahrenheit in Death Valley, California, on Monday — may now be behind us.
It has long been a “big mystery” how much grant funding from the Inflation Reduction Act the Biden administration ultimately got out the door before leaving the White House. Previously, the administration had announced awards for about 67% of the $145.4 billion in grants. Still, it wasn’t until Republicans in Congress began their rescissions of the bill’s unobligated funds that a fuller picture began to emerge.
According to reporting by my colleague Emily Pontecorvo, the Biden administration spent or otherwise obligated about $61.7 billion before leaving office, with President Trump’s One Big Beautiful Bill clawing back $31.7 billion from 47 IRA programs. Programs that had the greatest proportion of their funding obligated include:
There’s a lot more in the data to dig through, too, which Emily does here.
Senate Republicans voted narrowly Tuesday evening to advance President Trump’s $9.4 billion rescissions package, with Vice President JD Vance casting the tie-breaking vote. Three Republican senators — Mitch McConnell of Kentucky, Susan Collins of Maine, and Lisa Murkowski of Alaska — joined Democrats in opposing the package. Congress must vote to approve the rescissions by Friday to meet a statutory 45-day deadline that began when President Trump sent his proposal on June 3. The vote-a-rama is set to begin Thursday afternoon.
The proposed package would eliminate $1.1 billion from the Corporation for Public Broadcasting, which funds PBS and NPR, as well as large portions of foreign assistance programs. (A controversial plan to cut $400 million from the country’s AIDS relief program, known as PEPFAR, was ultimately removed to convince Republican holdouts.) But as I’ve written before, the package also takes aim at $1.7 billion of the $3.6 billion appropriated for the Economic Support Fund, which has historically been used to work with international partners to mitigate the impacts of climate change, as well as $125 million from the Clean Technology Fund, which provides financial resources for developing countries to invest in clean energy projects. The White House has said the programs do not “reflect America’s values or put the American people first.”
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China announced Tuesday that to protect the valuable breakthroughs that have allowed it to produce inexpensive electric vehicles, it will begin to restrict “eight key technologies for manufacturing [EV] batteries,” The New York Times reports. The move, which is effective immediately, will require a license from the Chinese government before any technologies can be transferred overseas “through trade, investment or technological cooperation.”
The move follows pressure by the European Union on Chinese EV and battery manufacturers to build factories within the bloc. As I covered in Heatmap AM yesterday, electric vehicle sales are booming in China in large part due to their affordability, with the nation being the “only large market where EVs are on average cheaper to buy than comparable combustion cars,” BloombergNEF has found. Though lithium-ion phosphate battery technology originated in the United States more than three decades ago, Chinese companies BYD and CATL have “figured out a way to further increase the number of recharges, making it comparable to more traditional battery chemistries,” in addition to advances in mass-production and capacity, the Times adds.
The third quarter of 2025 will “likely” see record sales of electric vehicles in the United States as would-be buyers rush to use the $7,500 tax credit before it expires on September 30, Cox Automotive’s Kelley Blue Book reported this week. Electric vehicle sales were lower in Q2 of 2025 than in 2024 by 6.3%, with 310,839 new EVs sold, marking “only the third decline on record, and a sign of a more mature market,” Stephanie Valdez Streaty, senior analyst at Cox Automotive, said in a statement. Additionally, sales of used EVs — only a third of which had qualified for government incentives anyway before those were eliminated — are up, with 100,000 units sold in Q2. But the real story will be what happens in Q3, where there’s “about to be a fire sale” as consumers race against the clock, Andrew Moseman writes for Heatmap. If you’re among the shoppers, he’s got the scoop on EV deals here.
The United States will either “reform” the International Energy Agency or “withdraw,” Energy Secretary Chris Wright told Bloomberg Tuesday during the Pennsylvania Energy and Innovation Summit at Carnegie Mellon University. The IEA, which was originally established to focus on oil security during the 1970s, has been characterized by Republicans as becoming a “cheerleader” for the renewable energy transition, in the recent words of Senator John Barrasso of Wyoming. Wright echoed those concerns in his conversation with Bloomberg, telling the publication that the IEA’s projections that oil demand will plateau this decade are “total nonsense.” Despite the threats, Wright stressed that his “strong preference” for handling the IEA is “to reform it.”
Several major beauty brands, including L’Oréal Paris and Neutrogena, are set to include environmental impact ratings on their packaging. “The EcoBeautyScore” — which runs from A to E — “indicates the environmental footprint of beauty products based on its entire lifecycle, from ingredients to packaging and how it is disposed of,” Cosmetics Business reports.
Rob does a post-vacation debrief with Jesse and Heatmap deputy editor Jillian Goodman on the One Big Beautiful Bill.
It’s official. On July 4, President Trump signed the Republican reconciliation bill into law, gutting many of the country’s most significant clean energy tax credits. The future of the American solar, wind, battery, and electric vehicle industries looks very different now than it did last year.
On this week’s episode of Shift Key, we survey the damage and look for bright spots. What did the law, in its final version, actually repeal, and what did it leave intact? How much could still change as the Trump administration implements the law? What does this mean for U.S. economic competitiveness? And how are we feeling about the climate fight today?
Jillian Goodman, Heatmap’s deputy editor, joins us to discuss all these questions and more. Shift Key is hosted by Jesse Jenkins, a professor of energy systems engineering at Princeton University, and Robinson Meyer, Heatmap’s executive editor.
Subscribe to “Shift Key” and find this episode on Apple Podcasts, Spotify, Amazon, YouTube, or wherever you get your podcasts.
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Here is an excerpt from our conversation:
Robinson Meyer: I want to ask a version of the Upshift / Downshift question of both of you, which is, how are you feeling?
Jillian Goodman: Dizzy. I’m feeling dizzy.
Jesse Jenkins: I would like a break. Yes.
Meyer: You both had your faces up against the coalface of this policy change over the past two weeks. And I’m not someone who thinks how we feel about climate change is always the most salient question. At some point of working on it professionally, I think one just kind of is like, well, this is the thing I work on, and I get up in the morning and I try to make it better, and it doesn’t really matter whether I’m optimistic or pessimistic at the moment because you just keep pushing. That’s how it works.
Jenkins: I think it’s how you survive in this game this long, is adopting an attitude like that to some degree.
Meyer: The U.S. just went through a kind of clattering change to its energy and climate policy and got rid of a number of policies that, although flawed, were pushing the U.S. energy system in the right direction, and were a real vote of confidence and of good faith in the energy transition. Has watching the events of the past two weeks made you feel pessimistic about the energy transition to come? Or are you feeling like, you know, for a world where Trump won, for a world where the U.S. faced the constraints and the political environment that it did in 2023 and 2024 and 2025, we can work with this and there’s gonna be new stuff coming down the pipeline and we’re gonna keep deploying.
Goodman: I will say, kind of similar to you, Rob, doing this work is sort of my way of processing my climate anxiety, or at least putting some kind of wall of professionalism between that climate anxiety and my daily life. Like, this is my contribution, and I think about it as a professional, and I don’t really think about it as a human as often.
I will say, it’s shocking to me how much of a … you know, it is not a 100% policy reversal, but the extent to which the government of the United States was willing to throw out its existing climate policy that took however many years and decades to get to just really kind of floors me. And it’s the kind of thing that we can’t do again, at least not in this way. It’s not that U.S. companies will never again trust a climate-oriented tax credit. I think that’s a bit of an overstatement. But this approach has been tried, and then it’s been undone. And so whatever approach is tried in the future will have to be something new, and it’ll have to be motivated by different arguments, and it will have to have different structures. And that project, I think, is also kind of daunting.
Jenkins: Yeah, so look, this is a terrible piece of policy for the United States, and for the world. And so on the one hand, I’m mad as hell about it, right? I mean, we haven’t even talked about the broader effects beyond climate of this bill. It’s going to kick nearly one in 20 Americans off of their health insurance. It’s going to explode the deficit so that we can mostly give tax cuts to wealthy people and corporations who don’t need it. It’s going to reduce food stamp spending for people who can’t afford to eat so that people who can afford first class flights can have another vacation. Like, this is just bad policy, and it is a bad way to do energy policy, to completely reverse course just because the other guy won the election, rather than to have a more thoughtful rationalization of the tax code for energy investment.
I think it’s particularly scary to think about the implications for our automotive sector, having basically replaced a pretty thoughtful and fairly successful domestic industrial strategy around EVs and batteries with basically nothing except for some subsidies that build a wall around the United States is really concerning.I don’t know that we’re gonna have a globally relevant auto industry in five years …
Mentioned:
The REPEAT Project report on what the OBBBA will mean for the future of American emissions
The Bipartisan Policy Center’s foreign entities of concern explainer
The new White House executive order about renewables tax credits
And here’s more of Heatmap’s coverage from the endgame of OBBBA.
This episode of Shift Key is sponsored by …
The Yale Center for Business and the Environment’s online clean energy programs equip you with tangible skills and powerful networks—and you can continue working while learning. In just five hours a week, propel your career and make a difference.
Music for Shift Key is by Adam Kromelow.