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The new rules are complicated. Here’s how to make sense of them if you’re shopping for an electric vehicle.

The Department of Treasury published new rules last year that will determine which new electric vehicles, purchased for personal use, will qualify for a $7,500 tax credit. They went into effect on April 18, 2023, and last for the next decade or so.
These new tax credit rules are complicated. The list of cars that qualify for the new tax credit can change from year to year — and even month to month. Many buyers in the EV market might have a few questions, including: Should I buy that new car now, or should I wait? Which cars qualify for the current tax credit, and which ones will earn the new one?
This is Heatmap’s guide to the new tax credit, why it matters, and what to keep in mind as you go EV shopping.
If you’re an ordinary American buying a brand-new EV to run errands and pick up the kids, these new rules apply to you. They will determine which cars you can get a federally funded discount on.
If you’re not buying a new car for personal use — because you’re getting it for your business, say, or because you’re buying a used EV — these new rules don’t apply to you. But you may qualify for other new subsidies. We get into those below.
And even if you are in that first category, you may discover it’s much cheaper to lease a new EV instead of buying it outright. We get into why below, too.
They completely change how the United States approaches the EV industry.
During the Bush and Obama administrations, the U.S. was focused mostly on getting automakers to begin to experiment with EVs. So it discounted the first 200,000 or so electric vehicles that each manufacturer sold by up to $7,500. If a company had cumulatively sold more than that number over time, as Tesla and General Motors eventually did, then the discount expired. By 2022, that had led to a peculiar situation where foreign automakers, such as Hyundai, could use the subsidy, while some of the largest American automakers couldn’t.
Now, U.S. policy is focused on two goals: (1) building up a domestic supply chain for EVs and (2) getting more EVs on the road. So the tax break is completely uncapped — any automaker can use it as many times as possible if they meet the criteria.
But many new requirements apply: Only cars that undergo final assembly in North America will qualify for any of the tax credit. Then, cars with a battery that was more than 50% made in North America will qualify for a $3,750 subsidy. And cars where at least 40% of the “critical minerals” used come from the U.S. or a country with whom we have a free-trade agreement will qualify for another $3,750 subsidy.
Those percentage-based requirements will ramp up over time. By 2029, for instance, 100% of a car’s battery and battery components must be made in North America.
Because Congress said so. The Inflation Reduction Act, which Democratic majorities in the House and Senate passed last year, mandated this change to the EV tax credit as part of its broad expansion of American climate policy.
Initially, fewer EVs will receive a subsidy under the new rules, Biden officials say. On a press call with reporters, a senior Treasury official argued that more cars will eventually qualify under the new rules than qualified under the old ones.
This year, at least 15 car or light trucks will receive some or all of the credit. Only some of those vehicles will qualify for the full $7,500 tax credit; some will qualify for a partial $3,750 tax credit. Here is the full list of qualifying models, along with the amount of the tax credit that they will earn:
• Audi Q5 TFSI e Quattro PHEV ($3,750)
• Cadillac LYRIQ ($7,500)
• Chevrolet Bolt ($7,500)
• Chevrolet Bolt EUV ($7,500)
• Chrysler Pacifica PHEV ($7,500)
• Ford Escape Plug-in Hybrid ($3,750)
• Ford F-150 Lightning, Standard & Extended Range ($7,500)
• Jeep Wrangler PHEV 4xe ($3,750)
• Jeep Grand Cherokee PHEV 4xe ($3,750)
• Lincoln Corsair Grand Touring ($3,750)
• Rivian R1S, Dual Large & Quad Large ($3,750)
• Rivian R1T, Dual Large, Dual Max, & Quad Large ($3,750)
• Tesla Model X Long Range ($7,500)
• Tesla Model 3 Performance ($7,500)
• Tesla Model 3 Long Range AWD ($3,500)
• Tesla Model Y AWD, Rear-Wheel Drive, & Performance ($7,500)
• Volkswagen ID.4 AWD PRO, PRO, S, & Standard ($7,500)
Some vehicles that earned the full tax credit in 2023, such as the Ford Mustang Mach E, don’t qualify for any benefit as of January 2, 2024.
Yes. A few examples: The Hummer EV, which costs more than $110,000 a piece, won’t qualify for either the new or old tax credit — it’s too expensive. And the Polestar 2 won’t qualify because it’s assembled in China.
Yes. Starting this year, the U.S. is preventing cars that receive too much manufacturing input from a “foreign entity of concern” — that is, China — from qualifying for any of the tax credit. This has reduced the number of vehicles that qualify for the $7,500 bonus.
This year, the government will also allow buyers to refund their EV tax credit at the dealership. That means buyers can now get up to a $7,500 discount at the moment when they buy their car instead of waiting until they file their taxes in the following year.
Yes. A married couple must have an adjusted gross income of less than $300,000 a year, and a single filer must have an AGI of less than $150,000 a year, to qualify for any aspect of the subsidy. A head-of-household must have an income of less than $225,000 a year.
Yes. Under the proposed rule, cars must have an MSRP below $55,000 to qualify for the credit. Vans, pickup trucks, and SUVs must have an MSRP below $80,000.
Yes. The Inflation Reduction Act also included a new $7,500 tax credit for EVs used for any commercial purpose. The Treasury Department is expected to interpret that provision to cover leasing, but it hasn’t announced the guidelines for that rule yet, so we don’t know for sure.
But the provision will probably tilt new EV drivers toward leasing their car rather than buying it outright, because the dealer should — emphasis on should — offer relative discounts on leasing vehicles as compared to buying them.
Yes. There’s also a new $4,000 tax credit for buying a used EV that costs $25,000 or less. It went into effect on January 1, 2023, so you can go ahead and use it today.
But note that it has even stricter income limits: Married couples can only take advantage of it if they make $150,000 or less, and other filers if they make $75,000 or less.
Here’s the list of cars that qualified for the $7,500 tax credit before April 18, 2023, according to the Department of Energy.
• Audi Q5 TFSI e Quattro (PHEV)
• BMW 330e *
• BMW X5 xDrive45e**
• Cadillac Lyriq
• Chevrolet Bolt
• Chevrolet Bolt EUV
• Chevrolet Silverado EV
• Chrysler Pacifica PHEV
• Ford E-Transit
• Ford Escape Plug-In Hybrid *
• Ford F-150 Lightning
• Ford Mustang Mach-E
• Genesis Electrified GV70
• Jeep Grand Cherokee 4xe
• Jeep Wrangler 4xe
• Lincoln Aviator Grand Touring *
• Lincoln Corsair Grand Touring *
• Nissan Leaf
• Nissan Leaf (S, SL, SV, and Plus models)
• Rivian R1S
• Rivian R1T
• Tesla Model 3 Long Range
• Tesla Model 3 Performance
• Tesla Model 3 RWD
• Tesla Model Y All-Wheel Drive
• Tesla Model Y Long Range
• Tesla Model Y Performance
• Volkswagen ID.4
• Volkswagen ID.4 AWD, Pro, and S models
• Volvo S60 PHEV *
• Volvo S60 Extended Range
• Volvo S60 T8 Recharge (Extended Range)
* These cars don’t qualify for the full $7,500 subsidy, although they all receive at least a $5,400 tax credit.
** Only some BMW X5 xDrive45e vehicles qualify — it depends where the car was made. Check the VIN or ask the dealership to confirm it was made in North America before buying.
This story was originally published on March 31, 2023. It was last updated on March 5, 2024, at 10:00 a.m. ET.
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The effective closure of the Strait of Hormuz and destruction of Gulf fossil fuel assets is already having effects we’ll be dealing with in months and years to come.
No matter how much longer the United States and Israel’s war with Iran lasts, the world’s energy system will be grappling with its consequences at least through the end of the year, if not for far longer.
The biggest short-run effects of the Iran energy crisis will be felt in Asia, where economies that run on Persian Gulf oil and gas face shortages and higher prices. The supply shock has — and will — drive up prices, leading oil and gas producers who aren’t stuck behind the Strait of Hormuz to seek higher returns. Much of the continent is already in the midst of an energy crisis, complete with fuel rationing and top-down policies to reduce oil and gas consumption.
In Australia, gas stations are running out of diesel. The government of the Philippines adopted a four-day workweek to reduce commuting. Pakistan announced a two-week school closure. Nepal is rationing cooking fuel. Thailand’s prime minister told civil servants to take the stairs, and the government set air conditioning to a minimum 79 degrees Fahrenheit.
Around the world, coal use is rising. Gasoline prices are on the way up, even in the United States, which is a net exporter of crude oil and petroleum products. Even if the war were to end tomorrow, oil and gas markets are likely to remain tight for many months to come.
Just as the oil shocks of the 1970s transformed the economies of the then-rich world — spurring the takeoff of nuclear power to in Japan and France; pushing the U.S. to direct R&D funding and subsidies to solar and shale gas; motivating carmakers around the world to developer smaller, more fuel-efficient vehicles — so too will this crisis likely transform how the entire world structures its dependence on oil and gas. It maybe already has.
Let’s take an industry-by-industry look:
The year began with a global oil glut. That has long since vanished. No matter what happens in Iran over the near to medium term, expect the oil market to remain tight.
Before hostilities with Iran ramped up, the consensus was that the market was “oversupplied,” Greg Brew, an analyst at the Eurasia Group, told me. “Demand growth was expected to be fairly sluggish. Production from OPEC states and the U.S. was expected to be fairly high, and prices were going to be in the $60s and potentially $50s [per barrel]. Obviously that is now completely out the door.”
Both Goldman Sachs and Morgan Stanley analysts speculated that the Brent crude benchmark could hit or even exceed its 2022 high of around $122 a barrel. It might even break through its all-time high of around $150, reached in 2008, should the closure persist.
Even if the strait were to reopen tomorrow, it would leave a large “air pocket” in the oil market, Morgan Stanley oil analyst Martijn Rats wrote in a note to clients last week, referring to oil that will never come to market because of shut-in production. That would keep prices high through the second and third quarters of the year as supply catches up to demand.
Oil analyst and author of the Commodity Context newsletter Rory Johnston estimated that the size of this “air pocket” is in the hundreds of millions of barrels. “Inventory will start dropping like a rock” over the coming weeks, he told me, “even if we could snap fingers and just go back to where we were two, three weeks ago.”
That squares with what Brew told me, as well. “Even when Hormuz reopens, the price band through the rest of the year is unlikely to fall below $75 a barrel, given the size of the physical disruption that we’re experiencing,” he said. A barrel of oil cost around $60 at the end of last year, before the price began to creep up as the U.S. gathered forces around Iran.
There will likely still be a “sustained risk premium” for any tanker leaving the strait as long as the current Iranian regime remains in power, Brew said. “The most likely outcome from this war is one where Iran is weakened but has not collapsed — where it retains the capabilities to threaten traffic through the strait and to threaten [Gulf Cooperation Council] states.”
A supply squeeze that could have resolved quickly once the Strait of Hormuz reopened and Qatar’s Ras Laffan facility got up and running again turned into a years-long interruption when Iran knocked out 17% of Qatar’s liquified natural gas export capacity, taking out almost 13 million tons per year of gas production, according to Morgan Stanley. As recently as a month ago, Qatar supplied about a fifth of global LNG capacity. The damage will likely take several years to fix, the chief executive of QatarEnergy told Reuters.
“What started as a transitory (but significant) capacity outage has escalated to a multi-year loss of supply,” Morgan Stanley analysts wrote in a note to clients Thursday. “Even with near-term resolution, the global gas market will need to contend with refilling inventories amid a large supply loss, creating upside price risks.”
European and East Asian LNG importers will likely choose to pay the higher prices. Poorer countries in South and Southeast Asia, however, may have to go without.
“There is now no longer going to be an LNG glut in 2026. There’s going to be a tight gas market,” Brew told me. “That’s going to keep regional prices high. That’s going to keep European prices high. That’s going to keep Asian prices high. That’s going to mean emerging markets in South Asia and Southeast Asia that would otherwise be able to buy LNG cargoes are going to have a tougher time.”
Much of the rationing of electricity or the shutdown of fertilizer plants in South and Southeast Asia was already happening before this week’s catastrophic attacks, the result of Qatar cutting off production due to earlier strikes.
No matter how long the war lasts, European and Asian gas buyers will have to refill their gas reserves before winter sets in again, which will further strain an already tight market. The Morgan Stanley analysts said prices are more likely to go up than down through the rest of the year even if there’s deescalation soon.
Jefferies analyst Julien Dumoulin-Smith wrote in a note to clients Wednesday that “even if the disruption proves temporary, LNG’s perceived risk profile has likely shifted structurally.”
“The conflict has underscored how concentrated global LNG supply remains around a narrow choke-point. That realization alone may embed a higher risk premium in LNG pricing,” he wrote. “Over time, higher prices could slow demand growth among some price-sensitive buyers and alter how buyers assess long-term LNG investment decisions.”
Just like in 2022, countries that suddenly find themselves short on natural gas will almost certainly turn to coal. “My sense is that this is going to be great for coal as 2022 was,” Brew said, referring to the uptick in coal usage following the Russian invasion of Ukraine, which cut off a major source of natural gas supply for Europe.
In both Europe and Asia, the “coal equivalent” price of gas has shot up, meaning that natural gas is now much more expensive on a dollars-per-unit-of-energy basis. This will incentivize switching to dual use gas and coal plants, or else bringing under-utilized coal-burning power plants into service, especially in Asia.
South Korea said earlier this week that its nuclear and coal power plants could raise their output in light of reduced LNG availability. South Korea is heavily dependent on both fossil fuels and imported energy — 84% of its energy supply is imported on net; almost 80% of its energy supplies are fossil fuels, and about 15% of its LNG imports come from Qatar.
The energy consulting firm Wood Mackenzie estimated that coal-fired power plants in Japan and South Korea could offset 70% and more than 100% of their gas-fired generation, respectively. But, Wood Mackeznie noted, that’s only in the current “shoulder season,” when mild weather means less electricity demand. “If disruptions persist into peak summer demand, the effectiveness of coal as a buffer will diminish, increasing exposure to tighter supply conditions.”
In Europe, which invested heavily in renewables and gas imports (largely from Norway and the United States) following the Russian invasion of Ukraine, coal’s cost favorability to natural gas is improving, but overall demand has been falling as days get longer and warmer. In Germany, coal’s share of electricity generation rose 2% in March compared to February.
There are already anecdotal reports of enthusiasm for renewables picking up in light of the fossil fuel supply shock. Bloomberg reported that electric vehicle showrooms are filing up across Asia with interested buyers looking to avoid expensive and sometimes rationed fuel.
Oil demand, particularly in Asia, “will be lower than it was before the war in terms of the expectation,” Johnston said. “There is no possibility, in my mind, that we do not see an enhanced drive toward energy efficiency, electrification, and other forms of diversification. It’s just the obvious outcome of this.” He said the amount of vulnerability Asia has to oil and natural gas is “existential” and “not tolerable.”
“Energy security and affordability is a much more compelling political argument” for a transition to clean energy than moral arguments about preventing future climate change, he added.
The same could be true for natural gas, especially LNG. The “next leg” for LNG growth globally, Dumoulin-Smith wrote, was supposed to be “price-sensitive demand in South/Southeast Asia.” That growth could be put at risk by “sustained higher prices” that induce “demand destruction, fuel switching (notably coal), delayed downstream infrastructure investment, or possibly ‘skipping’ LNG as a transition fuel in favor of renewables.”
In a note sent to clients Friday, Dumoulin-Smith wrote, “We see a constructive demand tailwind for U.S. clean energy peers beyond 2026,” due to “the multi‑year energy challenges implied by the escalation” of attacks on energy infrastructure in the Persian Gulf.
Even in the United States, which is more insulated from some of the worst shocks (we’re not going to run out of natural gas anytime soon), now may be a good time to “be stepping back and thinking a little bit more holistically about how we’re structuring our energy policy and our energy systems,” Francis O’Sullivan, managing director at S2G Investments, told me.
“We need to take a more all-of-the-above type approach to our energy system and our energy policymaking than is currently the case.”
There are ever-so-slight signs of a thaw toward renewables and in favor of an all-of-the-above strategy in the U.S. The federal government late last week declined to appeal a federal court ruling in favor of offshore wind developers who sued the Department of the Interior over its stop work orders. Senate Democrats have said they’re once again open to a deal with Congressional Republicans and the White House to ease permitting for all types of energy projects.
The consequences will linger well past the high temperatures.
It is difficult to describe how bonkers this week’s heat wave is in the southwestern United States. Alan Gerard, a typically even-keeled meteorologist with 35 years of forecasting experience under his belt, attempted to do so in a recent edition of his newsletter, Balanced Weather. He settled on: “jaw-dropping,” “insane,” “truly historic,” “literally flabbergasting,” “incredible,” and “anomalous [even for] the middle of summer.”
Jeff Berardelli, the chief meteorologist at WFLA, the NBC affiliate in Tampa, tried to contextualize it on social media, noting that based on historical patterns, Phoenix could expect a March day as hot as it was on Thursday — 105 degrees Fahrenheit — only once every 4,433 years.
Phoenix is just one part of the story. The heat wave — which began ramping up on Tuesday, peaks Friday, and won’t subside until early next week — has set or tied March record highs in at least 480 locations so far, stretching from New Mexico to Southern Oregon. California has already broken the record for the hottest winter day ever recorded anywhere in the U.S.: 109 degrees on Thursday at a station in the eastern Coachella Valley. “The extent and magnitude of this particular heat wave is without comparison to anything that we’ve seen in March,” John Abatzoglou, a professor of Climatology at the University of California, Merced, who specializes in climate impacts in the West, told me.
That’s partially because this heat wave would be “virtually impossible for the time of year in a world without human-induced climate change,” per a report released Friday by scientists from World Weather Attribution. Heat waves have one of the clearest climate signals of any extreme weather event because a hotter planet means a hotter baseline. “Across almost the entire western U.S., temperatures [this week] were made at least five times more likely due to climate change,” Zachary Labe, a climate scientist at Climate Central, which maps the effects on daily temperatures, told me.
The March 2026 heat wave is likely to become a reference point in the same vein as the 2021 heat dome in the Pacific Northwest, subject to study, research, and scrutiny by climatologists, public health experts, hydrologists, and emergency managers in the months and years to come. The consequences of the current heat wave will also outlast the record temperatures. When it is this hot — and, more importantly, when it is this hot this soon — the effects compound, touching everything from hydropower capacity to the coming wildfire season.
To make matters worse, “this week is exacerbating conditions that were already bad,” Labe said.
Let’s take a look.
About half of the total utility-scale hydroelectricity in the U.S. is generated in the three West Coast states, but it is part of the energy mix in almost every state experiencing the heat wave this week, including also Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, and Wyoming. In these states, high-elevation snowpack acts as a kind of battery; the slow release of melting winter snow from the mountains over the spring and summer helps keep generation reliable. In the case of a major heat wave, however, the water can run off too fast or evaporate, limiting supply in the summer-peaking months.
Though reservoirs in California are mostly in good shape at this point, with the rivers flowing high this early, there will be less water available when the squeeze comes in July and August. “This year, at least for precipitation, it’s been really quite good [in California],” Abatzoglou, the UC Merced professor, told me. The issue is, it’s also “just been way too damn warm.”
Every major river basin in the western U.S. experienced its first- or second-warmest winter this year, setting a grim stage for the high temperatures that have settled over the region this week. What little snowpack there already was — 97% of the snowpack-monitoring weather stations in Colorado are in snow drought — is now being hammered by the kind of heat the region doesn’t often experience before late spring or early summer. Daniel Swain, a climate scientist with the University of California Agriculture and Natural Resources, has warned that, as a result, we might see “June snowpack levels by April 1” in some parts of the West.
Of particular concern is what this will mean for Lake Powell, the reservoir created by the Glen Canyon Dam on the Colorado River, which supplies electricity to more than 5 million customers across seven states. The reservoir is a mere 40 feet away from the minimum volume required to turn the turbines in the dam, Bloomberg reports.
The early-season heat-driven runoff will further diminish the river’s already reduced flow in the coming months. Snow accumulation in the basin above Lake Powell was only at 67% of the 30-year median for March. Earlier this week, the U.S. Colorado Basin River Forecast Center downgraded its two-week-old forecast for inflows to Lake Powell during the critical April through July period from 2.3 million acre-feet of water to less than 1.8 million acre-feet. That would represent just 27% of the river’s 30-year historical average inflow; to understand how much the unseasonable heat has affected that, projections were more than 3.6 million acre-feet of water at the start of the year.
Though it is the bottom left corner of the country that has drawn the most attention for its triple-digit temperatures this week, records are also toppling in southeastern Oregon and southwestern Idaho, where highs are 20 to 25 degrees Fahrenheit above normal. Kurt Miller, the executive director of the Northwest Public Power Association, a nonprofit that represents public utilities in the region, told me his modeling shows that two consecutive 80-degree days in Boise are enough to trigger runoff starting “in earnest” in the Pacific Northwest, where dams meet about 60% of the region’s electricity demand.
The good news is that the high temperatures in Idaho are forecast to be “peaky” rather than prolonged, as they will be in the southwest, meaning the Pacific Northwest isn’t likely to string together the series of hot days necessary to trigger a catastrophic melt-off scenario. Additionally, while snowpack in the Northwest has been dismal this year, hydropower in the region is largely determined by upstream conditions in British Columbia and Montana, which have been closer to seasonal norms and, more importantly, are out of range of this week’s heat event.
There is another obvious downside to the early snowmelt in the West: Fire season will likely start sooner. “This is basically hitting fast-forward,” Abatzoglou, the University of California, Merced professor, told me. “It’s pushing us much faster toward the crispy season.”
Especially given the already historically low snowpack (in the northern Sierras, snow is at just 38% of its normal levels), the heat current wave could move up the start of fire season by weeks as high elevations melt out and soil and vegetation begin to dry. Usually, such conditions aren’t seen before the late spring or early summer.
While major wildfires have mostly spared high-elevation landscapes in recent years, “I expect that will not be the case this year,” Swain, the scientist at UC ANR, said in a video posted earlier this week. He further predicted that “we’ll see an especially severe and early start to fire season in the four corners — Arizona, New Mexico, Utah, and Colorado,” as well as a potential “severe peak” later in the forests of Northern California, Oregon, and the Rockies. (If there’s a saving grace, though, it’s that the lack of precipitation in the West has also curbed the fuel loads by keeping vegetation growth to a minimum.)
Adding to the alarm is the fact that “this year’s snow accumulation pattern most closely resembles 2015, followed by 2005,” as the National Interagency Fire Center wrote at the start of the month. Both were historically bad fire seasons: In 2005, a then-record 8.7 million acres burned, and in 2015, the U.S. broke more than 10 million acres burned for the first time.
Some research also indicates that longer fire seasons can lead to more severe wildfires, which, in addition to posing greater risks to people and property, take a deeper toll on state and federal firefighting resources and personnel. If the season starts sooner, wildland firefighters are more likely to be exhausted by the time the severe fire days of “dirty August” and “Snaptember” finally come around.
Still, any estimates of the direct impact of this week’s heat wave on the upcoming fire season should come with a hefty margin for error. Wildfires are influenced by a number of factors, both climate-related and not, ranging from historic forest management practices to the timing of the “green up” of local fuel loads to, yes, when and where the snow melts off. But an early dry fuel bed also means prescribed burning efforts can begin sooner, the NIFC notes in its March forecast (although that said, the dry fuel bed may also eventually “curtail burning late spring into early summer if timely moisture intrusions do not materialize”).
It could still take months for the immediate-term impacts of this week’s heat wave to come into focus. Excess mortality takes weeks to calculate and sometimes years to pin down precisely; researchers didn’t conclude their formal study of the 159 deaths resulting from the 2021 heat wave in Washington state until 2023.
What we do know is that early-season severe heat is especially dangerous for human health because people aren’t yet acclimatized to it. In fact, between 50% and 70% of outdoor heat-related fatalities occur in the first few days of a heat wave, according to the Occupational Safety and Health Administration. That’s because it can take between four days and two weeks to adapt physiologically to handling heat stress, including the slow process of building up adequate blood plasma to cope with the increased cardiovascular and cooling demands on the body.
And lest we forget, this heat has arrived staggeringly early, in some places breaking the daily temperature record by as much as 11 degrees. It took until August last year for Los Angeles to experience a similarly “strong” heat wave, senior AccuWeather meteorologist Heather Zehr said in a press release.
Drownings increase during heat waves as people seek out water to cool off, but there is a reason to be especially concerned about water this week. That’s because many people will head to rivers, and that water will likely be cold and high due to rapid snowmelt in the mountains, Abatzoglou told me. In addition to its extreme heat warnings this week, the National Weather Service has also been posting PSAs reminding Americans that “cold water can kill.”
There could be impacts on agriculture, too. It is fruit- and nut-blossom season in California’s Central Valley, which produces about three-quarters of those products consumed in the United States. It’s the Valley’s Mediterranean-esque climate, in part, that makes the region so productive; this time of year, daily highs are more typically in the mid-60s, perfect for the trees. Now, however, they’re cresting 90 degrees, threatening the Valley’s $21 billion in annual exports and more than 200,000 agricultural jobs. Further south near San Diego, there are also mounting concerns for the avocado industry, as the plants have particularly heat-sensitive blooms.
Though the heat wave is expected to begin breaking next week, a definitive end to the dry, unseasonably warm troubles in the West is nowhere in sight. April is the crucial transition month in the West, when states can sometimes stabilize after winters with poor snowpack or low precipitation through late-season storms. But “unfortunately, taking a look at some of the longer-range outlooks, it’s more likely than not there will be warmer than normal temperatures continuing across the West into April,” Labe said. “So just all around bad news.”
Both are now trapped in the same doom loop.
Renewable energy is getting roped into the data center sector’s publicity woes as a broader industrial techlash sweeps many corners of the nation.
Data center developers often want solar energy because you can stand up a project with it quite quickly. It’s also plainly better for the planet to have solar powering data hubs as opposed to gas or coal. But across the country, counties and towns enacting moratoria on data centers are blocking solar developments, not to mention wind and battery storage, while politicians struggling with resident concerns about data centers are responding by going after renewables and transmission that would add solar or wind to the grid.
Examples keep piling up of data center frustrations boiling over into renewables discussions and vice versa. You can find them in data center hubs like Indiana, as well as in less developed areas of the central and western United States. In Oklahoma, activists fighting data centers are protesting with leaders in the anti-renewables grassroots movement. In Alabama, lawmakers are considering a full-blown ban on solar because of a single project that would offset power demand from a big Meta data center. In Missouri, a similar proposal significantly limiting solar development is being pushed by a top GOP state senator under fire for previously defending data centers.
This phenomenon is spreading beyond solar farms to manufacturing. Take York County, South Carolina, where the upset over Silfab Solar’s module plant is energizing calls to pause a QTS data center proposal.
“Your land is being stripped of value by industrial complexes of all kinds,” Oklahoma State Representative Jim Shaw told attendees of a March 7 “Green New Scam” protest outside the state capitol building in Tulsa. The protest commingled anti-wind figures with communities fighting other tech infrastructure, and video from the event shows people had signs stating “Stop the NDAs” – a popular rallying cry against data center developers. “They do not care. Your voice is silenced. Your calls and emails go unheeded. Your cries for help are ignored and even belittled,” Shaw said to dozens of passionate assembled protesters.
Reagan Farr, CEO of solar developer Silicon Ranch, told me in an interview this week that he is increasingly concerned about the solar industry being swept up in the backlash to data centers. This trend, which Farr said he’s “thought about a lot,” reminds him of Occupy Wall Street, where “they’re against Big Tech, AI [and] big capital,” while maintaining “the same lack of faith in large institutions.”
“If you read the content in all of these ’Stop Solar’ Facebook groups, they really don’t distinguish between AI, data centers, Bitcoin, and renewables. It’s a general complaint against all of the above,” Farr told me. “It’s a fraught environment, and one I think is going to only continue to be more difficult as we move forward.”
Farr said this backlash to solar power in the data center boom reminded him of the Occupy Wall Street movement, in that people are expressing distrust at quickly growing industries and institutions. These conflicts wind up muting necessary discussions about the environmental impacts of fossil fuel development and fossil-powered data centers, he said. “Even when they’re talking to me, a founder and CEO, they’re like, You’re a big, faceless company. And no, we’re actually people who care about the environment and your community.” (Our extended conversation is included at the end of this newsletter).
Now, this isn’t to say fossil fuel infrastructure is any more popular than solar or wind when it’s how data centers get their power. One of the most common complaints about data center projects is about the pollution from diesel backup generators. And in the heart of West Virginia coal country, homeowners are suing the gas company behind a major data center. It would be a mistake to think renewables are singularly vulnerable to this problem.
In more conservative and rural communities of the U.S., however, the industrial techlash really matters. That’s because data centers are facing pushback over some of the same factors bedeviling renewables: fears over declining farmland, cultural misalignment, and a general lack of trust.
Kim Georgeton, a Republican politician in Ohio, told me she thinks farmland impacts make solar a tough sell when it’s attached to a data center in rural areas, where she said the physical footprint of a solar farm or a data center can be what triggers animus. “Once you convert agriculture – whether it be with data centers or solar or wind – you’re interrupting the agricultural land,” she told me.
Georgeton is a former software developer and current candidate for lieutenant governor on a GOP primary ticket this year alongside Casey Putsch, an anti-data center candidate for governor. While their bid is currently polling in longshot territory, the campaign has gained traction in factions of Facebook where anti-renewables and anti-data center opposition likes to organize, and Putsch is doing an event with environmentalists at the University of Cincinnati this weekend on data center opposition.
Heatmap’s polling also backs up Georgeton’s point of view. A Heatmap survey conducted last fall found that both Republican and independent voters said a convincing reason to oppose data centers is that they “might require wind or solar farms to be constructed nearby.” The data also found people were just as convinced to dislike data centers on the prospect it would possibly “require nuclear power plants to be constructed nearby.” Even more convincing, according to our polling? The risk of a data center causing new gas plants to pop up.
It’s now safe to say that the AI and energy sectors are in this fight together.