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The all-American EV startup is cutting costs to survive.

America’s most interesting electric-vehicle company is about to have the defining year of its life.
On Wednesday, the company reported that it lost $1.58 billion in the fourth quarter of last year, bringing its net annual losses to $5.4 billion. It announced that it is laying off about 10% of its salaried employees, but — at the same time — promised that it has a plan to achieve a small profit by the end of this year.
Rivian does not seem to be in trouble — not quite yet, at least. But the earnings made clear what electric-vehicle observers have known for a long time: Either the company will emerge from this year poised to be a winner in the EV transition, or it will find itself up against the wall.
That’s partially because Rivian has a stomach-turning number of corporate milestones coming up. Over the next 11 months, it plans to unveil an entirely new line of vehicles, shut down its factory for several weeks for cost-saving upgrades, break ground on a new $5 billion facility in Georgia, and — most importantly — turn a profit for the first time. It also expects to manufacture and deliver roughly another 60,000 vehicles to customers.
Any one of these goals would be difficult to achieve in any environment. But Rivian is going to have to execute all of them during a time defined by “economic and geopolitical uncertainties” and especially high interest rates, its CEO R.J. Scaringe told investors on Wednesday. Since 2021, Rivian’s once robust stockpile of cash has been cut in half to about $7 billion; at its current burn rate, the company will run out of money in a little more than two years.
Although Rivian’s situation is dire, it’s not experiencing anything out of the ordinary. As I’ve written before, the electric truck maker is crossing what commentators sometimes call “the EV valley of death.” This is the challenging point in a company’s life cycle where it has developed a product and scaled it up to production — thereby raising its operating expenses to eye-watering levels — but where its revenue has not yet increased too.
During this vulnerable period, a company essentially burns through its cash on hand in the hope that more customers and serious revenue will soon show up. If those customers don’t arrive, then it either needs to raise more cash … or it runs out of money and goes bankrupt.
It’s a frightening time, but once a company crosses the valley of death, it can reach an idyll. Not so long ago, Tesla found itself in something like Rivian’s position as it prepared to launch the Model 3. Seven years later, it is the most valuable automaker in the world.
Once Rivian’s revenue exceeds its costs, its problems will get easier, or at least more straightforward: Instead of fighting for its survival and watching its cash reserves dwindle, Scaringe will be able to make more strategic trade-offs. Should the company cut costs to expand its profit margin and reward investors, or should it pass the savings along to customers in the form of lower prices, thus growing its market share? Scaringe can’t make these types of decisions until his firm is safely out of the valley.
Claire McDonough, Rivian’s chief financial officer and a former J.P. Morgan director, has a plan for crossing that canyon — an aptly if strangely named “bridge to profitability” that it will attempt to build this year. Rivian’s survival, she said, will depend above all on cutting the unit costs of producing its vehicles, including by using fewer materials to make every car. Other savings will come from making more vehicles faster. That’s what makes the shutdown plan, though it might seem extreme, worth it; McDonough said those improvements alone will get the company about 80% of the way to profitability.
Another 15% will come from marketing more “software-enabled products” to Rivian drivers and by selling air-pollution credits to other carmakers, whose vehicles are not as climate-friendly. This is a tried-and-true technique; Tesla first turned a profit in 2021 by selling regulatory credits needed to comply with federal and California state-level rules to other, dirtier automakers. But that same year, Tesla also debuted an entirely new vehicle: the Model Y crossover, which quickly became its top seller in the United States. Tesla, in other words, finally started to make money by cutting costs, finding new revenue sources, and releasing new products.
New products, however, are becoming a weak point for Rivian. The company says that high interest rates will keep demand for its vehicles flat this year. It expects to make about 60,000 of them, about 20,000 fewer than what it had once anticipated. The Rivian R1S, a three-row S.U.V., has become the company’s flagship; it is selling better and is cheaper to manufacture than Rivian’s pickup, the R1T. It also costs at least $75,000, or nearly $600 a month to lease. The highest-tier models can cost $99,000. Turns out, it’s difficult to sell a lot of $70,000 trucks when even the cheapest new-car loans hover around 6%.
Rivian once had a first-to-market advantage in the electric three-row SUV market, but that may be fizzling out, too. Kia is now selling its own all-electric three-row SUV, the EV9, for $18,000 less than the R1S; in fact, the Kia EV9’s most expensive trim costs $76,000, which is only slightly more than the cheapest R1S. The Kia SUV can also charge faster than the Rivian under ideal conditions. It remains an open question how many rich suburbanites are still interested in buying Rivians, especially now that the Tesla Cybertruck and Ford F-150 Lightning are competing directly with Rivian’s pickup truck.
The company’s hopes, in other words, rest on its next product line: the R2, which it will launch on March 7. We know almost nothing about the R2 line, except that it will probably include an SUV, that it will go on sale in 2026, and that it will fall somewhere in the $45,000 to $55,000 price range. (The median new car transaction in the United States now costs $48,200.) Last year, Scaringe told me that the R2’s timing was perfect because it would fit “beautifully with what we see as this big shift” in the American EV market. In today’s market, he said, “a lot of people ask themselves, Am I gonna get an electric car? Well maybe the next one.” He better hope they’ll start buying that next one in 2026.
Even if they do, Rivian may still have to confront the problem that Tesla has changed the EV market before Rivian could get there. When the first Tesla Model 3s were delivered in 2017, the sedan was instantly one of the best EVs on the market — because it was one of the only EVs on the market. Now every automaker in the world has plans to compete at the Model 3’s price point.
Rivian’s fortunes don’t rest entirely on American consumers; it also sells vans to commercial fleet operators, as well as delivery trucks to Amazon. (Amazon owns about 17% of Rivian.) But that business can be lumpy. Rivian’s vehicle growth slowed down last quarter, for instance, almost entirely because of a near pause in sales to Amazon, which sets up fewer new vehicles in the fourth quarter. If Amazon is willing to bail out Rivian, in other words, it’s not yet clear in the data.
None of this is to say that the company’s outlook is dire. Rivian was always going to find itself at a moment like this, when its expenses exceeded its revenue by such a large amount. The automaker already has devoted fans, and many people — myself included — are interested in the R2 as a potential first EV purchase.
And the company has shown that it can make strides in a single year. Twelve months ago, I had never seen a Rivian on the road before; today, one is regularly parked on my block. The company rocketed from a standing start to become the No. 5 best-selling electric car brand in America last year. What the company has done so far is impressive. But now it must prove that it can be great.
Editor's note: This story has been updated to correctly reflect Rivian's cash burn rate.
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The Supreme Court keeps changing the terms of the deal between the legislative branch and the executive.
The Supreme Court ended its 2025–2026 term today, issuing a flurry of rulings on its most controversial cases. Most significantly, it rejected President Trump’s attempt to overturn birthright citizenship, preserving the 14th Amendment as it has been read for more than a century. It also struck down restrictions on how much political parties can spend in coordination with candidates — a change that could shape political strategies in November’s midterm election.
But I suspect that the year’s most important ruling for energy and climate policy came … yesterday. In a 6-3 ruling, the court’s conservative majority allowed President Trump to fire the commissioners of independent agencies without cause. Although the case concerned the Federal Trade Commission, it will matter for every independent agency that governs energy and climate policy.
My colleague Matthew Zeitlin wrote about what the case will mean for the Federal Energy Regulatory Commission, for instance, and I urge you to read his story. As he writes, the agency that governs the country’s power markets, transmission grid, and natural gas infrastructure has a culture of bipartisan consensus, even comity, and the ruling could chill that warmer clime. Last year, a cross-partisan group of 11 former FERC officials warned that allowing the president to fire commissioners “would bulldoze the structural supports that Congress built into” the agency to protect its power “from abuse.”
But FERC is not the only commission that governs climate and energy policy. The Nuclear Regulatory Commission — which Trump has also sought to bring to heel — is led by independent commissioners. So too are the Securities and Exchange Commission and the Commodity Futures Trading Commission, which the Biden administration tried (and largely failed) to turn into climate policy-making agencies.
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The independent commission is an old American legal structure, invented in the 19th century to manage issues where Congress deemed technical expertise and a deliberative process were essential to producing good policy. Although some guardrails for these agencies remain intact — such as requirements that a certain number of their commissioners come from each party — the court has permanently changed how they work. For instance, instead of having to wait for commissioners at FERC or the FTC to retire, step down, or serve out their terms, the president can now fire any or all of them and remake an independent commission almost as soon as they take office — assuming, at least, a cooperative Senate that is willing to confirm new appointees.
While reading about the ruling, I’ve found myself thinking back to an article written last year by the Georgetown Law professor Josh Chafetz. It concerns a little-known (or at least new to me) 1983 Supreme Court case, INS v. Chadha, that reshaped the relationship between Congress and the executive branch. For decades, Congress passed laws granting new powers to the president (or a federal agency) while retaining the ability to nullify those powers with a “legislative veto,” whereby one or both houses of Congress could cancel a given action with a simple majority vote.
In Chadha, the court ruled that the legislative veto was unconstitutional, a decision that affected hundreds of statutes, according to Chafetz. But crucially, the court did not cancel Congress’ grants of authority in those statutes; it only removed Congress’ ability to veto the use of that authority by a vote. In doing so, it ratcheted up the executive branch’s powers and diminished the legislative’s — “thereby leaving in place only one side of a bargain between Congress and the presidency,” Chafetz writes.
Why does this matter? Because the court is doing something similar again. Congress struck a bargain with the president when it set up commissions like FERC and the NRC: It granted new powers to the executive branch, but also placed important restrictions on how those powers can be used. In allowing the president to fire commissioners, the Supreme Court has altered the deal, preserving Congress’ grant of authority while removing any real restrictions on the president’s ability to use that authority. In doing so, it has overhauled how those agencies work, essentially creating a new and more potent version of FERC, or the NRC, or the FTC that wears the staff and authorities of the old one as a skin suit.
No legislator would have chosen to set up FERC, or the NRC, or the FTC as they now exist. But after the Supreme Court’s partial demo job yesterday, they are the agencies we have. The court has overhauled how the United States regulates electricity markets, or antitrust law, or nuclear safety regulation. Let’s pray, I suppose, that the Supreme Court doesn’t alter the deal any further.
I promised I wouldn’t write about Europe’s air conditioning adoption today, and I have kept my vow. But my colleague Jeva Lange — who just returned from a 10-day trip on the continent with her husband, her 9-month-old daughter, and her 69-year-old father — has written about it, and in the most delightful way. What was Europe actually like, as an (ew) American? Find out.
I decided to go to Italy in June with my husband, my 9-month-old daughter, and my 69-year-old father. What could go wrong?
The start of a vacation really begins 10 days before departure, when your arrival date first appears on your weather app. Like the turning over of a tarot card, it is this initial forecast that hints at the potential character of your trip — whether your beach vacation might be ruined by rain, or if spring break will fall this year during an unanticipated cold spell.
For our recent trip to Bologna, Italy, my family and I seemed to have pulled one of the worst cards in the deck: Our weather apps suggested early on that the high would be near 100 degrees Fahrenheit on the weekend of our arrival.
Little did we know then, it would never cool down.
Coming on the heels of Europe’s second-hottest May on record, an extreme heat wave settled over the continent on June 18, 2026 — the first day of our trip — and lasted through Sunday, June 29 — the day we returned home. This would, on its face, seem to be a case of abysmal luck. But as someone who writes about extreme heat, it felt more like the moment I went from covering the story to living it myself, a jarring but not uncommon experience among my professional colleagues. As is often the case on the climate beat, it is only a matter of time before we become the subjects of our own stories.
To be sure, I’ve been hot in Europe before. Last year, I was also in Bologna during a heat wave, when the city set a record for the highest minimum temperature in June. At that time, I was pregnant and attending the Il Cinema Ritrovato film festival with my husband, a movie critic. Despite the wimpy European AC running in the theaters — and the nonexistent AC in many of the city’s best restaurants — we had such a good time that we pledged to make our attendance an annual family tradition. Next year, we decided then, we’d return with the baby.
Ah, the naïveté of parents to-be!
Our itinerary took us from Seattle to Paris for a one-night stopover before we would carry on to Bologna. On our arrival day, June 18, Paris hit 97 degrees Fahrenheit. Determined to try to see as much of the new-to-us city as we could, we stuck the baby in a backpack and raced from our air-conditioned room to another AC oasis, the Musée d’Orsay — a walk of about half an hour that took us along the sun-blasted east end of the Tuileries and over the exposed Pont Royal. By the time we reached the long line of wilting tourists waiting to enter the museum, our daughter had slumped, lethargic, in her carrier. Beside ourselves with panic, we pushed our way into the museum’s lightly air-conditioned ticketing office. I was calculating the fastest way to get medical help — yell for security and hope the museum had paramedics on hand? Dial the local emergency number? — when, after what felt like a terrifyingly long time, she opened her eyes and cried.
I’ve replayed that walk over and over in my head, wondering where we went wrong. Unfortunately, it is difficult to get good medical information about babies and heat. Infants’ warning signs are contradictory — sweat is a red flag, but so is not sweating; increased irritability should be watched for, but so should lethargy — and an individual’s acclimation and compounding conditions like hydration and airflow make it even harder to know when a temperature is safe, or isn’t. Did the sweltering ride into the city on an overcrowded RER mean our daughter was already under heat stress when we left again for our walk? Was it just jet lag compounding her lethargy? Was it the heat transfer from being in a carrier that was at fault, or all that direct sun on the Seine?
Whatever the cause, we arrived in Bologna on edge. In addition to our daughter, I was worried about the other most vulnerable member of our small party: my dad, a senior, who joined us a few days later. Having reported on the 2021 Pacific Northwest heat dome deaths and knowing the cardiac stressor of dehydration, especially on older adults, I was extra obnoxious about making sure everyone carried a water bottle and ensured that the apartment we rented (which I’d made extra sure came with air conditioning) stayed at an “American-style” temperature of “wrap yourself in a blanket indoors.” (I admit to having the weak American mind disease when it comes to using AC, although I was fascinated by the story a Belgian friend told about the social stigma against installing AC in his country because it’s perceived as making the conditions hotter for one’s neighbors.)
Still, meals out couldn’t be avoided, and while many restaurants seemed to have added air conditioning since our trip last year, Bologna is still an eat-on-the-street kind of city. Breakfast was tolerable; leaving for lunch and dinner, though, felt like having a tennis racket of heat swung directly at your face as soon as you stepped outside. The city’s famous porticoes, a “historical form of climactic refuge” designed to provide passive cooling in the form of shade and airflow, offered marginal relief. But even the clever medieval architecture couldn’t compete with the fossil fuel emissions-worsened heat; after the sun went down around 9 p.m., the heat would linger, radiating out of the masonry. The thermometer I hung from the stroller frequently read over 90 degrees Fahrenheit even as late as 11 p.m. To keep the baby cool, we tucked ice packs wrapped in burp cloths alongside her in the stroller, misted her with fans, and covered her legs in a Frogg Toggs evaporative cooling towel that we’d rewet in the city’s public water fountains.
During our 10 days in Italy, the daytime high never dropped below 95 degrees, and my dad and the baby spent almost their entire vacation indoors — either at the apartment or at the wonderful Biblioteca Salaborsa, a library and one of Bologna’s community cooling centers. It was from my colleague Robinson Meyer that I later learned more than half of Italian households now have air conditioning, although adoption has grown faster in the south than in the north, where we were. That’s a pattern that extends across Europe; about “28% of French homes and 13% of apartments have some kind of air conditioning,” Rob further writes.
But while excess mortality takes a long time to calculate accurately, France already reports that more than 1,300 people have died due to the heat since June 21, 2026. Most of the casualties are among people over the age of 65, as is usually the case during heat waves, but small children are also among the dead.
There isn’t a tidy ending to this story. We were hot, we lived, and we went home. I have almost no pictures of my child on her first international vacation because she spent practically all of it indoors, but that is hardly a tragedy. And — as I kept reminding myself when my intrusive thoughts and mom guilt became overwhelming — there are millions of parents raising millions of children in parts of the world that are very, very hot. What we accomplished, while inconvenient, was nothing extraordinary; in the coming years, it will probably become even more banal. (Indeed, it was about 10 degrees hotter in parts of France during this heat wave than anything we endured in Bologna.)
But let’s go back to that excess mortality number for just a moment. In 2022, a summer likely to be cooler than the six-day-old El Niño-fueled one now beginning in Europe, the World Health Organization calculated that more than 61,000 people died on the continent due to extreme heat stress. That’s 61,000 people with daughters and sons who also harangued them about remembering to drink water or stay out of the sun; 61,000 people who now won’t see their grandchildren start school, who won’t attend another family meal, who won’t take another vacation. While I spent 10 days worrying about how to keep the people I care about safe from extreme heat, it’s all but certain someone else — many someone elses — lost the ones they love in those same temperatures.
On the night before our departure for Paris, when our whole weather app had filled up with 97, 98, and 101 degree days stretching into the foreseeable future, my husband and I asked each other if we still wanted to go and be in that kind of heat. What a privilege it is, for now, to have been able to decide.
Republican Mike Braun loves data centers but hates electricity price increases.
Elected officials — especially in executive positions like governor, mayor, or, say, president — tend to support economic development writ large, looking to bring jobs to their constituents and expand the tax base. By that same token, they also tend to be quite sensitive to rising costs — especially utility bills, for which voters tend to hold state governments accountable, per Heatmap polling.
That puts governors — especially Republican governors, who are often more friendly to business and more likely to buy into arguments proffered by the White House about national security and economic competitiveness — in a tricky position as both the data center buildout and opposition to it gain momentum across the United States. No one embodies the dilemma more than Indiana’s Governor Mike Braun, who has positioned himself as a champion of data centers while also going on the rhetorical warpath against the utility AES Indiana and the Indiana Utility Regulatory Commission.
His latest barrage against Indiana’s electricity ratemaking process started in mid-June, when the utility commission approved a rate case from AES Indiana granting the utility a $71 million revenue increase across two phases, the first beginning in July, each of which will raise monthly bills by “less than $5 per month,” according to the company. AES had originally asked for a $190 million increase, but thanks in part to intervention from Indiana’s Office of Utility Consumer Counselor, a public advocate in utility rate hearings, it was eventually whittled down.
The utility commission handed down its decision on June 17. Later that same day, Braun issued a blast against AES and the IURC, saying in a statement that “my top priority is affordability, which is why I am deeply disappointed by the IURC’s approval of another AES rate increase. Hoosiers have spent years tightening their belts and making tough financial decisions. It’s time for utility companies to do the same.” The next day he was back with another fire-breathing statement: “Yesterday’s decision by the IURC to allow another rate increase by AES is unacceptable,” he said, and called for a rehearing of the rate case.
The regulator is in the midst of an “investigative inquiry on energy affordability” launched earlier this year that has required the state’s five large investor-owned utilities to make presentations on their ratemaking. “We’ve heard the concerns about the burden utility bills have on families and businesses across the state, and we are committed to evaluating short- and long-term solutions related to affordability,” then-Chair Andy Zay said in a news release in February announcing the investigation.
Braun, apparently, wasn’t convinced. By Monday, June 22, he’d removed Andy Zay as chairman of the IURC, and installed Commissioner Anthony Swinger to lead the regulator. “Affordability is my top priority,” he reiterated in a post on X, “and I am confident Chairman Swinger will deliver on that priority for Hoosiers.”
When asked about this past month’s events, AES Indiana said that it “respects the independence of the regulatory process and works constructively with all stakeholders. We remain focused on executing under the final approved order and delivering for our customers,” a spokesperson told me. Neither Braun’s office nor the IURC responded to my requests for comment.
The rhetoric was not particularly new for Braun. Last fall, for instance, he declared of utility rate hikes, “we can’t take it anymore,” and ordered the state’s utility consumer advocate “to evaluate utilities’ profits and find cost-saving measures to ease the financial burden on Hoosiers.” That said, his swift actions of late surprised some outside observers. “While Gov. Braun has made utility affordability a priority, the abrupt leadership change at the IURC is nonetheless surprising,” Jefferies analyst Julien Dumoulin-Smith wrote in a note to clients. “We perceive a cautionary tone for Indiana regulation; future orders will likely be more visibly defensible on affordability.”
Indiana sits at the transmission-rich crossroads between the Midwest and East Coast and has long been governed by business-friendly Republicans, and has thus become a locus of data center construction — and backlash. Twenty-one out of 92 counties in the state have enacted some sort of pause or ban on data center construction, according to Heatmap Pro data. Earlier this year, the Indianapolis City Council passed a resolution calling for a pause on approvals for data centers. When the White House earlier this year got large technology companies to commit to the Ratepayer Protection Pledge, in which they agreed to fund any additional grid costs incurred by their data centers, it was arguably following in the footsteps of Indiana, which negotiated a large load tariff last year meant to shield customers of Indiana Michigan Power, a subsidiary of AEP, from data center-related costs.
Braun’s position in Indiana also mirrors the ideological divide in Washington — Braun supports data center development while demanding that utilities figure out a way to spare ratepayers. Advocates to his left, both at the state and federal level, support a pause on all data center construction. André Carson, one of two Democrats representing Indiana in the House of Representatives, introduced a bill that would enact a nationwide data center moratorium alongside Alexandra Ocasio-Cortez and Bernie Sanders. (For what it’s worth, most Americans seem to prefer the leftward road.)
Indiana’s typical household electricity bills have indeed risen in the past couple of years, from about $113 per month two years ago to $120 per month as of May, while prices have risen 19%, according to Heatmap and MIT’s Electricity Price Hub. Prices are up 12% in the past year, according to the Heatmap-MIT data, while the electricity prices nationwide have risen 6%.
Attributing rate hikes to data centers is a notoriously tricky exercise, however, and researchers have generally found that in most states, it’s hard to discern an exact connection. When pressed, Indiana utilities have claimed that higher prices are necessary to fund improvements for reliability or cold weather. Some critics of Indiana utilities, like Citizens Action Coalition Ben Inskeep, attribute years of rate hikes to coziness between the state legislature and utilities and the gradual weakening of regulators who could push back against hikes. Citizens Action has called for a moratorium on data centers in the state.
In spite of his harsh words against utilities, Braun has generally supported data centers as part of an overall economic development strategy, appearing at the groundbreaking for a $10 billion Meta data center project in Lebanon, Indiana, earlier this year. “In Indiana, it’s clear we’re a very easy state to do business in, but the communities are going to have to approve it,” he said on Fox Business earlier this month, setting himself up as a champion of local communities and ratepayers. “In Indiana, if you’re coming in, you’re paying for all of the construction and the generation of electricity, and you’re going to put more electrons onto the grid, taking prices down,” he said.
Braun’s consumer-and-conservation-minded critics have taken aim at this exact claim in pushing for a pause on development.
“We are one of the three or four Ground Zero states for data center development. We’re extremely attractive to data centers,” Kerwin Olson, executive director of Citizens Action Coalition, told me. “That happened at the same time as bills skyrocketing.”
Olson pointed out that Indiana’s data center boom has come at the tail end of a series of controversial economic developments, including a proposed hydrogen hub, carbon capture and storage projects, and a proposed water pipeline. “Here comes Amazon, here comes Meta, Google, and all hell just broke loose,” Olson said.
Referring to Braun, Olson said, “We don’t doubt his sincerity about his concern about affordability. We disagree with him on these solutions that need to happen.”