You’re out of free articles.
Log in
To continue reading, log in to your account.
Create a Free Account
To unlock more free articles, please create a free account.
Sign In or Create an Account.
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Welcome to Heatmap
Thank you for registering with Heatmap. Climate change is one of the greatest challenges of our lives, a force reshaping our economy, our politics, and our culture. We hope to be your trusted, friendly, and insightful guide to that transformation. Please enjoy your free articles. You can check your profile here .
subscribe to get Unlimited access
Offer for a Heatmap News Unlimited Access subscription; please note that your subscription will renew automatically unless you cancel prior to renewal. Cancellation takes effect at the end of your current billing period. We will let you know in advance of any price changes. Taxes may apply. Offer terms are subject to change.
Subscribe to get unlimited Access
Hey, you are out of free articles but you are only a few clicks away from full access. Subscribe below and take advantage of our introductory offer.
subscribe to get Unlimited access
Offer for a Heatmap News Unlimited Access subscription; please note that your subscription will renew automatically unless you cancel prior to renewal. Cancellation takes effect at the end of your current billing period. We will let you know in advance of any price changes. Taxes may apply. Offer terms are subject to change.
Create Your Account
Please Enter Your Password
Forgot your password?
Please enter the email address you use for your account so we can send you a link to reset your password:
The long-delayed risk disclosure regulation is almost here.
A new era of transparency for corporate sustainability is coming — finally. After two years of deliberation, the Securities and Exchange Commission is expected to issue a final rule requiring public companies to make climate-related disclosures to investors. The decision could come as soon as next week.
The rule considers two categories of climate-related information relevant to investors: greenhouse gas emissions and exposure to climate-related risks like extreme weather or future regulations. While many companies voluntarily disclose this kind of information in other ways, the rules will both require and standardize climate-based reporting as a core part of a company’s fiduciary duty.
From almost the moment it appeared, the proposal has been the center of a lobbying firestorm. Some of the rule’s opponents write it off as part of an activist agenda — an indirect route to economy-wide carbon regulations. “The host of new requirements in this Proposed Rule are motivated by a small number of environmental activists who seek to steer the economy away from fossil fuels,” wrote twelve Republican attorneys general in a letter to the SEC responding to the proposal. The U.S. Chamber of Commerce, meanwhile, vowed to fight back against “unlawful and excessive government overreach.” (At a Chamber-sponsored event last October, SEC Chair Gary Gensler joked, “Wait, are you already suing us? I just walked in.”)
Certainly there are environmentalists who do see the rule as a tool to undermine the oil and gas industry. But proponents primarily make the case that the stakes are less about the atmosphere and more about protecting investors and the entirety of the financial system.
While we’re still waiting on the final rule — which was originally expected in the fall of 2022 and has been repeatedly delayed — here’s a catch-up on what we know so far.
At a basic level, the SEC makes rules saying what companies have to disclose and how so that investors can make well-informed decisions. The two types of information this particular rule covers — climate-related risks and greenhouse gas emissions — are distinct, but related.
The former is pretty straightforward. From the growing number of billion-dollar weather- and climate-related disasters in the United States to the ongoing exodus of insurance companies from fire and flood-prone areas to trade delays in the drought-stricken Panama Canal, it’s clear that climate change poses a substantial financial risk to businesses. It makes sense that investors would want to know how exposed a company’s warehouses or data centers or trucking routes are to wildfires and floods.
But why should investors care about a company’s emissions? Because they are an indicator of another type of risk.
“A shareholder is not necessarily concerned with whether a company is ‘on target’ with any climate commitment,” Boston University law professor Madison Condon writes, “but rather in assessing how exposed an asset may be to changes in global or local climate policy, energy prices, or shifts in consumer and investor sentiments.”
These changes are already in motion around the world, and are generally accelerating. Companies that aren’t preparing could be disadvantaged, or alternatively, could miss lucrative opportunities. Steven Rothstein, a managing director at the nonprofit Ceres, gave the example of the steel industry. If you think that, in the next several years, customers are going to ask for low-emission steel — which some already are doing — or that there might be a regulatory cost put on steel-related emissions, then a company with lower emissions will be better positioned to grow, while a company with higher emissions might have to spend a bunch of money to retrofit its factories.
Part of the SEC’s rationale for the rule is the proliferation of investor-led initiatives calling for government-mandated climate risk disclosure. “These initiatives demonstrate that investors are using information about climate risks now as part of their investment selection process and are seeking more informative disclosures about those risks,” the Commission wrote in its proposal. (Oil giant Exxon filed suit against the sponsors of one such proposal in January, having lost patience with proposals it said were “calculated to diminish the company’s existing business.”)
After the draft rule was released in March 2022, the SEC was bombarded by thousands of comments from investors, academics, NGOs, politicians, trade associations, and companies. One analysis of those comments by legal researchers found that investors were the most supportive group, with more than 80% in favor of the rule.
The most contentious aspect of the proposal invited criticism even from parties that were generally supportive of the rule. The SEC had taken a strong stance on emissions reporting, asking companies to disclose emissions indirectly related to their business, known as“scope 3” emissions. That means a company like Amazon wouldn’t just have to report the emissions from its warehouses and delivery trucks, but also an estimate of the emissions associated with producing and using all the products it sells. A company like Ford wouldn’t just have to report the emissions from its factories, but also from the production of the raw materials it uses, as well as from all the gasoline burned in the cars it sells.
Those in support of scope 3 reporting point to the fact that for many companies, including the two I just named, the number would vastly exceed their direct emissions.
In a legal review of why scope 3 emissions reporting matters, Condon warned that without it, companies could begin outsourcing their most emissions-intensive processes to third parties in order to appear greener than they actually are. She also argued that leaving out scope 3 obscures climate risks. She gave the example of electric vehicles, which can involve higher emissions during production than conventional cars but result in much lower emissions over their lifecycle. “When excluding Scope 3, an EV manufacturer is penalized, even though from the perspective of considering transition risk and climate impact, this makes little sense,” she wrote.
But companies and their trade associations threw every excuse at the idea of a scope 3 requirement: It would cost too much to gather the data; the data on supply chain emissions is unreliable and impossible to verify; since companies don’t directly produce these emissions, they aren’t relevant; etc.
And by all accounts, they won. The SEC is expected to drop requirements to report scope 3 emissions in the final rule.
However, that’s unlikely to satisfy opponents, many of whom, like the Republican attorneys generals who wrote letters to the Commission, say the SEC doesn’t have the legal authority to require climate-related disclosures at all. If there’s one thing that critics and supporters agree on, it’s that the rule, whatever it says, is going to be challenged in court.
A lot of companies are going to have to report their scope 3 emissions anyway. The European Union’s Corporate Sustainability Reporting Directive includes scope 3 and is expected to cover more than 50,000 companies, with some starting to report as soon as this year; U.S.-based businesses on EU-regulated exchanges, or with subsidiaries or parent companies in Europe, will be expected to comply. A similar rule voted into law in California last year also requires scope 3 emissions disclosures and covers any company doing business in the state — whether private or public — giving it broader reach than the SEC. However, Governor Gavin Newsom did not include any funding for the law in his budget proposal this year, creating concern that it will be delayed.
Danny Cullenward, a climate economist and legal expert, said the fate of the California regulations are important in light of the likely Supreme Court challenge to the SEC rule. “It's a lot harder to mount comparably broad challenges to state laws on this front,” he told me.
Despite the SEC’s narrow focus on protecting investors, the mandatory disclosure of corporate emissions and climate risks would have widespread effects — even some that regular people might feel. Suddenly, consumers would have better tools to compare the relative sustainability of different companies and products. Activists would have more documentation to hold companies accountable for greenwashing or failing to live up to their public climate commitments.
The rule is also set to spark an explosion in the businesses of corporate emissions accounting and climate risk analysis. Most companies don’t have the staff or expertise to track their emissions, and thus will have to turn either to specialized climate-specific firms like Watershed or all-purpose corporate accountants like Deloitte to manage the disclosure process for them. Similarly, analytics giants like Moodys and S&P Global will also be called upon to feed company data into climate models and spit out risk reports.
Both exercises come with inherent challenges and uncertainties. Climate risk researchers have warned that rating services keep their methodologies in a black box, making it hard to know whether they are using climate models appropriately. “The misuse of climate models risks a range of issues, including maladaptation and heightened vulnerability of business to climate change, an overconfidence in assessments of risk, material misstatement of risk in financial reports, and the creation of greenwash,” wrote the authors of a 2021 article in the journal Nature Climate Change.
“When you ask, ‘What is my exposure to future climate risks?,’ you're asking for a projection of future climate states and probabilities of different future climate outcomes and extreme weather events. There's an enormous amount of scientific uncertainty and complexity in getting to that,” Cullenward told me.
But while neither emissions accounting nor climate risk assessment may be perfectly up to the task yet, Cullenward argued that’s all the more reason for the SEC to get these rules in place.
“If you don't ask people to disclose what's going on, it's just sticking your head in the sand,” he said. “No one will ever know how to do it perfectly, getting out of the gate. To me that is not a reason to stop or to slow down, that is a reason to get started.”
Log in
To continue reading, log in to your account.
Create a Free Account
To unlock more free articles, please create a free account.
The Senate told renewables developers they’d have a year to start construction and still claim a tax break. Then came an executive order.
Renewable energy advocates breathed a sigh of relief after a last-minute change to the One Big Beautiful Bill Act stipulated that wind and solar projects would be eligible for tax credits as long as they began construction within the next 12 months.
But the new law left an opening for the Trump administration to cut that window short, and now Trump is moving to do just that. The president signed an executive order on Monday directing the Treasury Department to issue new guidance for the clean electricity tax credits “restricting the use of broad safe harbors unless a substantial portion of a subject facility has been built.”
The broad safe harbors in question have to do with the way the government defines the “beginning of construction,” which, in the realm of federal tax credits, is a term of art. Under the current Treasury guidance, developers must either complete “physical work of a significant nature” on a given project or spend at least 5% of its total cost to prove they have started construction during a given year, and are therefore protected from any subsequent tax law changes.
As my colleague Matthew Zeitlin previously reported, oftentimes something as simple as placing an order for certain pieces of equipment, like transformers or solar trackers, will check the box. Still, companies can’t just buy a bunch of equipment to qualify for the tax credits and then sit on it indefinitely. Their projects must be up and operating within four years, or else they must demonstrate “continuous progress” each year to continue to qualify.
As such, under existing rules and Trump’s new law, wind and solar developers would have 12 months to claim eligibility for the investment or production tax credit, and then at least four years to build the project and connect it to the grid. While a year is a much shorter runway than the open-ended extension to the tax credits granted by the Inflation Reduction Act, it’s a much better deal than the House’s original version of the OBBBA, which would have required projects to start construction within two months and be operating by the end of 2028 to qualify.
Or so it seemed.
The tax credits became a key bargaining chip during the final negotiations on the bill. Senator Lisa Murkowski of Alaska fought to retain the 12-month runway for wind and solar, while members of the House Freedom Caucus sought to kill it. Ultimately, the latter group agreed to vote yes after winning assurances from the president that he would “deal” with the subsidies later.
Last week, as all of this was unfolding, I started to hear rumors that the Treasury guidance regarding “beginning of construction” could be a key tool at the president’s disposal to make good on his promise. Industry groups had urged Congress to codify the existing guidance in the bill, but it was ultimately left out.
When I reached out to David Burton, a partner at Norton Rose Fulbright who specializes in energy tax credits, on Thursday, he was already contemplating Trump’s options to exploit that omission.
Burton told me that Trump’s Treasury department could redefine “beginning of construction” in a number of ways, such as by removing the 5% spending safe harbor or requiring companies to get certain permits in order to demonstrate “significant” physical work. It could also shorten the four-year grace period to bring a project to completion.
But Burton was skeptical that the Treasury Department had the staff or expertise to do the work of rewriting the guidance, let alone that Trump would make this a priority. “Does Treasury really want to spend the next couple of months dealing with this?” he said. “Or would it rather deal with implementing bonus depreciation and other taxpayer-favorable rules in the One Big Beautiful Bill instead of being stuck on this tangent, which will be quite a heavy lift and take some time?”
Just days after signing the bill into law, Trump chose the tangent, directing the Treasury to produce new guidance within 45 days. “It’s going to need every one of those days to come out with thoughtful guidance that can actually be applied by taxpayers,” Burton told me when I called him back on Monday night.
The executive order cites “energy dominance, national security, economic growth, and the fiscal health of the Nation” as reasons to end subsidies for wind and solar. The climate advocacy group Evergreen Action said it would help none of these objectives. “Trump is once again abusing his power in a blatant end-run around Congress — and even his own party,” Lena Moffit, the group’s executive director said in a statement. “He’s directing the government to sabotage the very industries that are lowering utility bills, creating jobs, and securing our energy independence.”
Industry groups were still assessing the implications of the executive order, and the ones I reached out to declined to comment for this story. “Now we’re circling the wagons back up to dig into the details,” one industry representative told me, adding that it was “shocking” that Trump would “seemingly double cross Senate leadership and Thune in particular.”
As everyone waits to see what Treasury officials come up with, developers will be racing to “start construction” as defined by the current rules, Burton said. It would be “quite unusual” if the new guidance were retroactive, he added. Although given Trump’s history, he said, “I guess anything is possible.”
“I believe the tariff on copper — we’re going to make it 50%.”
President Trump announced Tuesday during a cabinet meeting that he plans to impose a hefty tax on U.S. copper imports.
“I believe the tariff on copper — we’re going to make it 50%,” he told reporters.
Copper traders and producers have anticipated tariffs on copper since Trump announced in February that his administration would investigate the national security implications of copper imports, calling the metal an “essential material for national security, economic strength, and industrial resilience.”
Trump has already imposed tariffs for similarly strategically and economically important metals such as steel and aluminum. The process for imposing these tariffs under section 232 of the Trade Expansion Act of 1962 involves a finding by the Secretary of Commerce that the product being tariffed is essential to national security, and thus that the United States should be able to supply it on its own.
Copper has been referred to as the “metal of electrification” because of its centrality to a broad array of electrical technologies, including transmission lines, batteries, and electric motors. Electric vehicles contain around 180 pounds of copper on average. “Copper, scrap copper, and copper’s derivative products play a vital role in defense applications, infrastructure, and emerging technologies, including clean energy, electric vehicles, and advanced electronics,” the White House said in February.
Copper prices had risen around 25% this year through Monday. Prices for copper futures jumped by as much as 17% after the tariff announcement and are currently trading at around $5.50 a pound.
The tariffs, when implemented, could provide renewed impetus to expand copper mining in the United States. But tariffs can happen in a matter of months. A copper mine takes years to open — and that’s if investors decide to put the money toward the project in the first place. Congress took a swipe at the electric vehicle market in the U.S. last week, extinguishing subsidies for both consumers and manufacturers as part of the One Big Beautiful Bill Act. That will undoubtedly shrink domestic demand for EV inputs like copper, which could make investors nervous about sinking years and dollars into new or expanded copper mines.
Even if the Trump administration succeeds in its efforts to accelerate permitting for and construction of new copper mines, the copper will need to be smelted and refined before it can be used, and China dominates the copper smelting and refining industry.
The U.S. produced just over 1.1 million tons of copper in 2023, with 850,000 tons being mined from ore and the balance recycled from scrap, according to United States Geological Survey data. It imported almost 900,000 tons.
With the prospect of tariffs driving up prices for domestically mined ore, the immediate beneficiaries are those who already have mines. Shares in Freeport-McMoRan, which operates seven copper mines in Arizona and New Mexico, were up over 4.5% in afternoon trading Tuesday.
Predicting the location and severity of thunderstorms is at the cutting edge of weather science. Now funding for that science is at risk.
Tropical Storm Barry was, by all measures, a boring storm. “Blink and you missed it,” as a piece in Yale Climate Connections put it after Barry formed, then dissipated over 24 hours in late June, having never sustained wind speeds higher than 45 miles per hour. The tropical storm’s main impact, it seemed at the time, was “heavy rains of three to six inches, which likely caused minor flooding” in Tampico, Mexico, where it made landfall.
But a few days later, U.S. meteorologists started to get concerned. The remnants of Barry had swirled northward, pooling wet Gulf air over southern and central Texas and elevating the atmospheric moisture to reach or exceed record levels for July. “Like a waterlogged sponge perched precariously overhead, all the atmosphere needed was a catalyst to wring out the extreme levels of water vapor,” meteorologist Mike Lowry wrote.
More than 100 people — many of them children — ultimately died as extreme rainfall caused the Guadalupe River to rise 34 feet in 90 minutes. But the tragedy was “not really a failure of meteorology,” UCLA and UC Agriculture and Natural Resources climate scientist Daniel Swain said during a public “Office Hours” review of the disaster on Monday. The National Weather Service in San Antonio and Austin first warned the public of the potential for heavy rain on Sunday, June 29 — five days before the floods crested. The agency followed that with a flood watch warning for the Kerrville area on Thursday, July 3, then issued an additional 21 warnings, culminating just after 1 a.m. on Friday, July 4, with a wireless emergency alert sent to the phones of residents, campers, and RVers along the Guadalupe River.
The NWS alerts were both timely and accurate, and even correctly predicted an expected rainfall rate of 2 to 3 inches per hour. If it were possible to consider the science alone, the official response might have been deemed a success.
Of all the storm systems, convective storms — like thunderstorms, hail, tornadoes, and extreme rainstorms — are some of the most difficult to forecast. “We don’t have very good observations of some of these fine-scale weather extremes,” Swain told me after office hours were over, in reference to severe meteorological events that are often relatively short-lived and occur in small geographic areas. “We only know a tornado occurred, for example, if people report it and the Weather Service meteorologists go out afterward and look to see if there’s a circular, radial damage pattern.” A hurricane, by contrast, spans hundreds of miles and is visible from space.
Global weather models, which predict conditions at a planetary scale, are relatively coarse in their spatial resolution and “did not do the best job with this event,” Swain said during his office hours. “They predicted some rain, locally heavy, but nothing anywhere near what transpired.” (And before you ask — artificial intelligence-powered weather models were among the worst at predicting the Texas floods.)
Over the past decade or so, however, due to the unique convective storm risks in the United States, the National Oceanic and Atmospheric Administration and other meteorological agencies have developed specialized high resolution convection-resolving models to better represent and forecast extreme thunderstorms and rainstorms.
NOAA’s cutting-edge specialized models “got this right,” Swain told me of the Texas storms. “Those were the models that alerted the local weather service and the NOAA Weather Prediction Center of the potential for an extreme rain event. That is why the flash flood watches were issued so early, and why there was so much advanced knowledge.”
Writing for The Eyewall, meteorologist Matt Lanza concurred with Swain’s assessment: “By Thursday morning, the [high resolution] model showed as much as 10 to 13 inches in parts of Texas,” he wrote. “By Thursday evening, that was as much as 20 inches. So the [high resolution] model upped the ante all day.”
Most models initialized at 00Z last night indicated the potential for localized excessive rainfall over portions of south-central Texas that led to the tragic and deadly flash flood early this morning. pic.twitter.com/t3DpCfc7dX
— Jeff Frame (@VORTEXJeff) July 4, 2025
To be any more accurate than they ultimately were on the Texas floods, meteorologists would have needed the ability to predict the precise location and volume of rainfall of an individual thunderstorm cell. Although models can provide a fairly accurate picture of the general area where a storm will form, the best current science still can’t achieve that level of precision more than a few hours in advance of a given event.
Climate change itself is another factor making storm behavior even less predictable. “If it weren’t so hot outside, if it wasn’t so humid, if the atmosphere wasn’t holding all that water, then [the system] would have rained and marched along as the storm drifted,” Claudia Benitez-Nelson, an expert on flooding at the University of South Carolina, told me. Instead, slow and low prevailing winds caused the system to stall, pinning it over the same worst-case-scenario location at the confluence of the Hill Country rivers for hours and challenging the limits of science and forecasting.
Though it’s tempting to blame the Trump administration cuts to the staff and budget of the NWS for the tragedy, the local NWS actually had more forecasters on hand than usual in its local field office ahead of the storm, in anticipation of potential disaster. Any budget cuts to the NWS, while potentially disastrous, would not go into effect until fiscal year 2026.
The proposed 2026 budget for NOAA, however, would zero out the upkeep of the models, as well as shutter the National Severe Storms Laboratory in Norman, Oklahoma, which studies thunderstorms and rainstorms, such as the one in Texas. And due to the proprietary, U.S.-specific nature of the high-resolution models, there is no one coming to our rescue if they’re eliminated or degraded by the cuts.
The impending cuts are alarming to the scientists charged with maintaining and adjusting the models to ensure maximum accuracy, too. Computationally, it’s no small task to keep them running 24 hours a day, every day of the year. A weather model doesn’t simply run on its own indefinitely, but rather requires large data transfers as well as intakes of new conditions from its network of observation stations to remain reliable. Although the NOAA high-resolution models have been in use for about a decade, yearly updates keep the programs on the cutting edge of weather science; without constant tweaks, the models’ accuracy slowly degrades as the atmosphere changes and information and technologies become outdated.
It’s difficult to imagine that the Texas floods could have been more catastrophic, and yet the NOAA models and NWS warnings and alerts undoubtedly saved lives. Still, local Texas authorities have attempted to pass the blame, claiming they weren’t adequately informed of the dangers by forecasters. The picture will become clearer as reporting continues to probe why the flood-prone region did not have warning sirens, why camp counselors did not have their phones to receive overnight NWS alarms, why there were not more flood gauges on the rivers, and what, if anything, local officials could have done to save more people. Still, given what is scientifically possible at this stage of modeling, “This was not a forecast failure relative to scientific or weather prediction best practices. That much is clear,” Swain said.
As the climate warms and extreme rainfall events increase as a result, however, it will become ever more crucial to have access to cutting-edge weather models. “What I want to bring attention to is that this is not a one-off,” Benitez-Nelson, the flood expert at the University of South Carolina, told me. “There’s this temptation to say, ‘Oh, it’s a 100-year storm, it’s a 1,000-year storm.’”
“No,” she went on. “This is a growing pattern.”