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When I stepped into the yellow-ish gray haze of New York City on Tuesday night, the air tasted of soot. My eyes stung and watered, inducing a headache. Even if you’ve felt it before, the visceral experience of wildfire smoke is a shock to the system. My mind went into flight mode. Do we need to get out of here? I thought. Like, right now, but also ... more permanently?
It’s not that I think of New York City as a climate safe haven. Increasingly crushing heat and humidity has repeatedly sent me into a panic. In the fall we play Russian Roulette with hurricanes. Scientists recently estimated that $8.1 billion in damages caused by 2012’s Hurricane Sandy were attributable to climate change-driven sea-level rise.
But despite the fact that this isn’t even the East Coast’s first experience with wildfire smoke, I doubt anyone here was expecting to be subjected to amber skies or spend hours tracking down an emergency air purifier. I may not be the only one contemplating an exit.
So where to go?
There’s now a whole genre of studies and articles designating certain cities or regions climate havens. In 2019, then-Harvard professor Jesse Keenan famously pronounced Duluth, Minnesota, “climate-proof,” for its cool temperatures and proximity to fresh water. Word spread, and Californians fleeing wildfires soon arrived. The mayor of Buffalo, New York, has deemed his city a “climate refuge” for similar reasons. Scientists have also nodded at places like Vermont and Portland, Oregon.
At the same time, many of these forecasters readily admit that no place is immune from the effects of climate change. It’s more about picking your poison. Duluth may not be at great risk of dangerous heat waves, but it is already seeing more frequent, intense storms. The city sits on the western tip of Lake Superior, which is one of the fastest-warming lakes in the world. The shoreline is eroding from floods, eating away at properties and tourist destinations.
The unprecedented heatwave in the Pacific Northwest in 2021 that melted power lines, caused roads to buckle, and killed hundreds of people shattered any illusion of the region as a climate paradise — even taking scientists by surprise. There was a similar reaction when a heat wave smashed records in the typically water-logged U.K. last year.
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The current wildfires in Quebec are also upending these narratives. Buffalo might not see a wildfire any time soon, but as I write this, the city’s AQI is nearly at an “unhealthy” 200, according to AirNow, the U.S. air quality index. Burlington, Vermont, is looking better, but saw a spike up to 135 last night, which is considered “unhealthy for sensitive groups.”
Marshall Burke, a Stanford climate economist, told my colleague Robinson Meyer that he’s reconsidering his usual pitch about the effects of global warming. In the past, he said, he’s posited that wildfire smoke, rather than extreme heat, will be the main way that people on the West Coast encounter climate change. “I would not have told that story for you guys on the East Coast,” he said. “And this is still one very historic event, so I’m not ready to tell that story, but I’m going to draw the boundary a little wider next time I give a talk on this.”
We don’t yet know the degree to which the wildfires raging in Canada right now are connected to anthropogenic climate change. In the West, it’s well established that the increased severity of fires is being driven, in part, by climate change-fueled drought and aridification. That could be playing a role in the current fires burning in Western Canada.
But the causes of wildfire are complex. Quebec, where many of the fires affecting the northeast are currently raging, is not in drought. It has had a particularly warm spring, though that could be due to natural variability rather than climate change. Ellen Whitman, a research scientist with the Canadian Forest Service, told Reuters that downed trees from a recent hurricane and a pest outbreak may have also fueled the fires.
One reason the fires have gotten so bad is clear: The country’s resources are stretched thin. There are more than 400 active fires across Canada right now. A record amount of land has burned, and it’s not even summer yet. A CBC segment titled “What's behind Quebec's 'unprecedented' forest fire season?” reported that the province’s fire fighting agency has been forced “to leave most of them to burn out of control.”
I don’t know whether this week’s smoky skies could become a “new normal” in places like New York City. But that flight response is probably only going to become a more familiar feeling, perhaps one you'll need to learn to sit with, no matter where you are.
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A conversation with Jillian Blanchard of Lawyers for Good Government about the heightened cost of permitting delays
This week I chatted with Jillian Blanchard, vice president of climate change and environmental justice with Lawyers for Good Government, an organization that has been supporting beneficiaries of the Inflation Reduction Act navigate the uncertainties surrounding tax credits and grant programs under the Trump administration. The reason I wanted to chat with Jillian is simple: the IRA is under threat for the first time under a Republican Congress. I wanted to understand how solar and wind projects could be impacted by the House Republican reconciliation bill and putting IRA tax credits in doubt. I learned a lot.
The following conversation was lightly edited for clarity.
Okay, Jillian, what’s the topline here? How would the GOP reconciliation bill impact individual projects’ development?
There are big chunks of the reconciliation bill that will have dramatic impacts on project development, including language that would repeal or phase out bipartisan and popular tax credits in a way that would make it very, very difficult to invest in projects. I can get into the weeds next.
But it’s worth saying first – the group of programs aside from tax credits that [House Republicans] would repeal represents every single part of America. Hundreds of projects that will not go forward if these programs are not going well. And they have several legally obligated grants that EPA has already mucked up in a litany of ways. But what they’re proposing to do is to pull the rug out from under those programs. On top of that they want to pull any unobligated funding out.
I think it’s extremely misrepresentative to say these are not big cuts. They’re significant cuts to clean air and clean water across the board.
Help me get into the weeds about how phasing out the credits will make it harder to invest in a project.
Right now, a bank might want to invest a certain amount of money in a clean energy project because they know on the back end they can get 30% or 40% back on their investment. A return through tax credits. They can bank on that, because tax credits are a guarantee.
Was that an intentional pun? “Bank”?
Yeah, it is. I love a good pun. You opened the floodgates, that was a mistake.
But anyway, the program itself was supposed to be around until at least 2032 and the bank could bank on those tax credits. That’s a big runway, because projects could get delayed and you could lock in the credit as soon as you started construction.
Now they’re doing a phase-out approach where if your project is not placed into service before a certain date, you don’t avoid the phase out. You don’t get any protections if you’re starting your project now or next year. It has to be placed in service before 2028 or else your project may not be eligible. You are constructing it, you are financing it, but then through no fault of your own – a storm or whatever – then suddenly that project is no longer entitled to get 30% or 40% back.
That’s a big risk. And banks don’t like risk.
Opposition on the ground also delays projects the way a storm does. Would this empower those opponents?
Oh, totally. Totally. If anyone wants to fight a project, a bank might be even less likely to invest in it. The NIMBYs for that particular project become a risk.
What would you tell a developer at this moment who is wondering about the uncertainty around the IRA?
I would tell them that now is the time to speak up. If they want to stay in this business and make sure their energy stays as low-cost as it already is, they need to speak up right now, no matter what their political party affiliation is. Make it clear solar isn’t going away, wind isn’t going away, storage isn’t going away. These are markets America needs to be competitive with the rest of the world.
Investors are only just now starting to digest what the proposed cuts will mean, especially for energy storage.
Is Wall Street too sanguine about the House of Representatives’ proposal to gut the Inflation Reduction Act? When the House Ways and Means Committee unveiled its language on the law on Monday — phasing out tax credits, implementing strict restrictions on business relationships with Chinese companies, and altering when projects are eligible for credits — some investors responded to the cutbacks by driving up the prices of some clean energy stocks.
The residential solar company Sunrun traded up on Tuesday by 8.6%, and the American solar manufacturer First Solar was up over 22%. (Stock movements on Monday were largely in response to the pause of the U.S.-China trade war, also announced that morning.)
“The early drafts of a Republican tax and spending bill weren’t as bad for renewables as feared,” wrote Barron’s. Morgan Stanley analysts used the same language — “not as bad as feared” — in a note to clients on the text. “Industry was bracing for way worse,” Don Schneider, the deputy head of public policy for Piper Sandler and a former Republican staffer on the Ways and Means Committee, wrote on X.
While many analysts — and, to be honest, journalists at Heatmap — have issued dire warnings about how the various provisions of the Ways and Means language could together make much of the IRA essentially impossible to use, even before the tax credits phase out, investors on Wall Street and in Washington seem to have shrugged them off. Some level of cutting was all but inevitable, and “not as bad as it could have been” is reason enough to celebrate — plus there’s also “it’ll probably change, anyway.”
There’s something to this. A group ofmoderate Republicans criticized the language on Wednesday as too restrictive, specifically citing changes to three overarching features of the tax credits: when projects would be eligible for tax credits, where companies are able to source components and materials, and whether companies are allowed to freely buy and sell tax credits generated by their projects. (Wouldn’t you know it, these complaints largely echo what Heatmap has written in the past few days.)
In the Senate, meanwhile, Republican Kevin Cramer of North Dakota, said that the text as written would be too damaging to advanced nuclear and enhanced geothermal generation. The phase-out timelines in the Ways and Means language are “too short for truly new technologies,” Cramer told Politico.
Pavan Venkatakrishnan, an infrastructure fellow at the Institute for Progress, told me that he expects the bill to evolve in a way to meet the concerns of Senate Republicans like Cramer.
“Given considerations both political and procedural, like the more flexible reconciliation instructions Senate Finance is afforded relative to House Ways and Means and the disproportionate impact current text entails for technologies Republicans traditionally favor, like nuclear, geothermal, and hydropower, I think it’s fair to say that this text will change over the coming weeks,” he said.
Finally, days after the Ways and Means committee made its thinking public, Wall Street seems to be catching on to the implications. The new foreign entities of concern rules pose a particularly huge danger to the renewable energy sector, according to Jefferies analyst Julien Dumoulin-Smith, and especially to energy storage, which would be the key provider of reliability on a renewable-heavy grid. Energy storage looks to account for almost 30% of new generator additions this year, according to the Energy Information Administration.
“We think the market got it wrong for storage,” Dumoulin-Smith wrote in a note to clients. The market has yet to “digest and fully interpret the implications of proposed tariff and tax policy, which as currently written do not bode well for storage,” he said. The foreign sourcing language “is more restrictive than initially thought, with some industry stakeholders calling the proposal a near repeal on IRA.”
The storage supply chain is intensely entangled with China. Many companies, including Tesla,have been forced to disclose to investors just how reliant they are on China for their storage businesses.
China alone accounted for 70% of battery imports in 2024, according to industry analysts at BloombergNEF, over $14 billion worth. About a quarter of the metals used in battery manufacturing — especially graphite — came from China, BNEF figures show. For specific battery chemistry like lithium iron phosphate, which is popular for stationary storage products, the supply chain is essentially 100% Chinese.
Wall Street revenue and profit estimates “do not adequately capture the extent of risks” facing the U.S. storage industry, Dumoulin-Smith wrote. The storage company Fluence’s stock fell around 1.5% today, and is down over 5.5% since close of trading on Monday, as the market began to digest the House language.
It is possible that the foreign sourcing rules will be loosened and phase-outs for tax credits and transferability lengthened, Venkatakrishnan told me, but not in a way that would endanger the overall structure of the bill. Cuts to the Inflation Reduction Act are a key source of revenue for the Republican bill-writers to ensure as many of the tax cuts they want can fit within the budgetary scope they’ve given themselves.
“Any adjustments will be made with an eye toward ensuring budgetary offsets are sufficient to enable success of the broader enterprise,” Venkatakrishnan said. In other words, as much as some lawmakers may want to see these tax credits preserved, ultimately, they’ve got to pass a bill to ensure Trump’s tax cuts stick around.
And more of the week’s biggest conflicts around renewable energy projects.
1. St. Lawrence County, New York – It’s hard out here for a 2-megawatt solar project in upstate New York.
2. McKean County, Pennsylvania – Swift Current Energy is now dealing with an insurgent opposition campaign against its Black Cherry wind project.
3. Blair County, Pennsylvania – Good news is elsewhere in Pennsylvania though as this county has given the go-ahead for a new utility-scale Ampliform solar project, the BL Hileman Hollow Solar project.
4. Allen County, Ohio – The mayor of Lima, a small city in this county, is publicly calling on Ohio senators to make sure that the pending reconciliation bill in Congress ensures Inflation Reduction Act tax credits can still apply to municipalities.
5. Vanderburgh County, Indiana – Orion Energy’s Blue Grass Creek solar project is now facing opposition too, with Orion representatives telling local press they actually expected some locals to be against the project.
6. Otsego County, Michigan – That state forest-felling solar farm that Fox News loved to hate? That idea is no more.
7. Adams County, Illinois – The Green Key solar project we’ve been following in the town of Ursa has received its special use permit from the county after vociferous local opposition.
8. Dane County, Wisconsin – We’re getting a taste of local worry about how the GOP’s efforts to change the IRA could affect municipal energy planning, thanks to the village of Waukanee.
9. Olmsted County, Minnesota – The fight over Ranger Power’s Lemon Hill solar project is evolving into a nascent bid to give localities more control over permitting renewables projects.
10. Cherry County, Nebraska – This county is seeking an investigation into whether Sandhills Energy’s BSH Kilgore wind farm is violating zoning standards after receiving requests from residents who are against the project.
11. Albany County, Wyoming – Bird conservation activists fighting wind projects in Wyoming claim the Interior Department is providing them incomplete information under the Freedom of Information Act about wind turbines and eagle deaths.
12. Santa Fe County, New Mexico – Renowned climate activist Bill McKibben is publicly going on the attack against opponents of an individual solar project, the AES Rancho Viejo solar farm near Santa Fe.
13. Apache County, Arizona – Opponents of the Repsol Lava Run wind project are now rallying around trying to stop transmission for the project.
14. Klickitat County, Washington – The Cypress Creek Renewables solar project we told you last week got fast-tracked by the state Energy Facility Site Evaluation Council? Turns out the county had a moratorium on new solar and anticipated a chance to formally file public comments before that would happen.