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June 4 was a busy day for democracy.
Democracy is having a big year — heck, it’s having a big month. More people will vote in 2024 than in any other year in human history, and many of those elections are happening right now: In just the past four days, Mexicans elected a climate scientist to the presidency; Indians braved extreme heat to reelect Prime Minister Narendra Modi; and Donald Trump’s pal Nigel Farage announced his return to the scrum of British politics in the hopes of holding off an historic win by the Labour Party on July 4.
Americans still have another few months of suspense before their own general election, but voting is well underway stateside, too. In Tuesday’s primaries, voters cast ballots for local offices in Iowa, Montana, New Jersey, New Mexico, and South Dakota — including in several races with significant implications for the climate.
While the results were a mixed bag, they also speak to the fact that climate change is increasingly unignorable by politicians, and it signals where campaigners and activists should focus their attention as the November election approaches. Here are six of the major takeaways:
What happened: Mariannette Miller-Meeks won the First District Republican primary in Iowa
Why it matters: Miller-Meeks is the head of the House’s Conservative Climate Caucus and has championed wind, solar, and nuclear energy; her opponent, David Pautsch, attacked her for not being conservative enough on issues like abortion, the national debt, and her support of tax credits for carbon pipelines. Though Miller-Meeks’ history isn’t likely to impress too many climate activists — she’s been particularly sympathetic to the liquified natural gas industry, claiming, “If you want a cleaner, healthier planet, the best thing you could do is to export American oil and gas” — her victory over Pautsch in deep-red Iowa proves that being associated with the word “climate” isn’t an automatic black mark against a Republican in 2024. Still, it wasn’t a comfortable victory: Early Tuesday evening, the returns had looked pretty worrying for Miller-Meeks, and the slim margin in some areas suggested the risk of breaking with the party line.
What happened: Democratic voters in New Jersey weren’t convinced by Hoboken Mayor Ravi Bhalla, who lost the Eighth Congressional District primary to Rep. Rob Menendez, Jr.
Why it matters: Of all the candidates who ran in contested primaries on Tuesday, none seemed to position themselves more overtly as a climate candidate than Bhalla. As mayor of Hoboken, Bhalla created a Department of Climate Action & Innovation in part to adapt to a future of extreme flooding in the city, has sued Exxon Mobil for climate-related damages, and centered climate as a campaign priority, earning endorsements from environmental groups like the New Jersey League of Conservation Voters and Food & Water Action. While many different factors go into winning — and losing — a campaign (especially in a state like New Jersey), one lesson of the night is that “climate,” at least in so many words, might not be the selling point that progressives sometimes think it is. Case in point: Bhalla’s campaign page on climate framed electrification as a means of reducing the state’s “carbon footprint”; Menendez’s focused mainly on the economy and jobs.
What happened: Tim Sheehy won the Republican Senate primary, setting him up to take on Democrat Jon Tester in one of the most nail-biting races of November
Why it matters: Retired Navy SEAL and aerial firefighter Tim Sheehy overcame a scandal involving a lie about his gunshot wound to take on Tester in a race that could decide the balance of the U.S. Senate — and, by extension, Biden’s climate agenda — in five months’ time. A Trump endorsee, Sheehy is not afraid of a good old-fashioned culture war, as evidenced by Bridger Aerospace, his aerial firefighting company, quietly removing references to environmental, social, and governance issues from its website after Sheehy entered the race. Any mention of climate change? That was gone, too. But Sheehy’s rhetoric during his primary campaign also reeked of the green boogeyman, with the candidate repeatedly using the term “climate cult” to dismiss Tester, Biden, and other perceived enemies. Though Tester, a working farmer, has championed climate-related causes in a way that has resonated even with many Republicans, Sheehy hasn’t yet appeared interested in debating the finer points of things like federal subsidies for going electric. Expect the attacks to get more colorful in the coming months; polls show Sheehy and Tester neck-and-neck.
What happened: Voters in Montana winnowed downa crowded field of six Republican utility board candidates to three finalists
Why it matters: Utility boards are some of the most influential elected bodies that almost nobody pays attention to, and Republicans in red and red-leaning states like Arizona and Alaska tend to hold the edge even in bluer urban areas. In Montana, the Public Service Commission decides the energy mix of the region in and around Billings, Missoula, Bozeman, Helena, and Butte, and has been in Republican hands for two decades. That explains the high level of Republican interest in the primary races on Tuesday, where five candidates played musical chairs for two available seats. The apparent winners — Brad Molnar in District 2 and Jeff Welborn in District 3 (in addition to incumbent commissioner Jennifer Fielder, who ran unopposed) — have hit-and-miss records when it comes to renewable energy. Molnar, who was reelected to the seat he held from 2005 to 2012, told the Montana Free Press he’s concerned about the “xenophobia” of conservatives in his state and has been known to break from party lines in his votes, in addition to voicing some belief in climate change (though he doesn’t say we can do anything about it). Welborn, meanwhile, described himself to the Free Press as a “free market guy” interested in preventing rate hikes with an “all-of-the-above” approach to energy that includes new nuclear plants and hydrogen, though he’s previously sided with the local utility over Montana’s consumer advocate. In November, Welborn will face Leonard “Lenny” Williams, the uncontested Democrat in the race, who’s called the gerrymandered utility board districts a “racket.”
What happened: Angel Charley easily won the New Mexico Democratic primary in Senate District 30, to the west of Albuquerque, on an environmental justice platform
Why it matters: With around 63% of the vote as of Wednesday morning, first-time candidate Angel Charley appeared to be the clear winner in her race against former state Senator Clemente Sanchez. Charley, the former director of the Coalition to Stop Violence Against Native Women, convinced voters in the recently redrawn district that climate goals aren’t different from popular policies like protecting vulnerable women living near extractive industries in their area, and can be pursued with projects like community solar development. As the experts I’ve spoken with have told me, sometimes the best way to move emissions-abating policies forward is by focusing on what climate activists might view more as positive externalities, but are more immediate to the communities in question. Charley’s victory on environmental justice grounds seems like further proof of concept. A Native American activist, Charley’s campaign focused largely on “lessening dependence on oil and gas and extractive industries, because there’s a correlation with violence against Native women when extractive industries are present.” Meanwhile, Sanchez’s campaign was heavily financed by corporate interests, including donations from an oil company, an auto dealer trade group, lobbyists, and utilities.
What happened: 17 out of 19 Republican and Democratic sponsors of a recent bill attempting to block a CO2 pipeline in the state who were up for reelection won their primaries
Why it matters:Located between the shale oil fields of North Dakota and the storage terminals of Texas, South Dakota is no stranger to pipeline proposals. Plans for a new pipeline that would funnel carbon dioxide produced by the local ethanol industry to North Dakota to be stored underground, however, have become a contentious wedge issue in the state and appeared to be behind some of the primary results on Tuesday night. Of the more than a dozen sponsors of a recent failed bill that would have prohibited the use of eminent domain for the construction of pipelines carrying carbon oxide, all but two who ran appeared to have been reelected as of Wednesday morning; some of the state’s losing incumbents, on the other hand, were behind a compromise bill that attempted to split the difference between protecting landowners and allowing the pipeline project to proceed. The slim margins in some races — The South Dakota Searchlight points to Mykala Voita, a landowner rights candidate who beat incumbent Republican Sen. Erin Tobin by 48 votes, within the margin to trigger a recount — speak to the deep divides and disagreements in the state. That also goes for divisions within the major parties about the use of eminent domain and suspicions about the technology of carbon capture and storage more largely.
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DAC startup Holocene has a novel chemistry and backing from Breakthrough Energy and Frontier Climate.
Direct air capture companies are in a race to prove they can reduce the cost of removing carbon from the atmosphere down below $100 per ton. Now, one is closing in on the prize with a first-of-its-kind deal.
On Tuesday, Google announced it will pay the startup Holocene $10 million to remove 100,000 tons of carbon from the atmosphere, to be delivered “by the early 2030s.” The tech giant said the price point was made possible by the federal tax credit for carbon sequestration, and its own willingness to cough up the bulk of the funds upfront.
There’s no question the deal is risky on both sides. Today, most estimates place the cost of direct air capture at upwards of $600 per ton. Bringing the cost down is essential if the tech is ever going to play a meaningful role in tackling climate change. But even the companies that are farthest along, like the Swiss pioneer Climeworks, aren’t sure they will be able to offer a price of $100 per ton by 2030. Holocene has yet to build a commercial plant, so its ability to remove carbon for $100 per ton is pure projection at this point.
But for Google, the goal is more to catalyze a potentially important climate solution than to clean up its carbon footprint.
“The point of our program is to help Google reach net zero in whatever way most helps the world reach net zero,” Randy Spock, the company’s carbon credits and removals lead, told me in an email. “So this deal is an example of us identifying what the planet needs (long-term cost reduction for Direct Air Capture) and then doing what we can to help it take a step in that direction.”
Though Holocene is relatively new to the direct air capture market, it was started by veterans. Co-founders Anca Timofte and Tobias Rüesh spent roughly six years working in research and development at Climeworks back in its early days, when the company was building its first prototypes. Timofte left in 2020 to get an MBA at Stanford, and while there, came across some exciting research out of Oak Ridge National Laboratory that described a new approach to removing carbon from the ambient air — one that seemed to have distinct advantages. Seeing the potential, Timofte decided to start Holocene with Rüesh and another Stanford classmate and, in 2023, licensed the Oak Ridge technology.
“The chemistry from Oak Ridge is special,” Timofte told me. “It's different than all other chemistries, we think, in direct air capture.”
Most direct air capture systems fall into one of two categories, liquid or solid, and each approach has trade-offs. Liquid systems typically have simpler engineering and can capture CO2 continuously, but require more heat, and therefore more energy. Solid systems have lower heat requirements, but work sort of like cartridges that get “charged” with CO2 and have to be “discharged,” and therefore capture CO2 in batches rather than in perpetuity.
Timofte described Holocene’s process as the “best of both worlds.” It captures CO2 in water and operates in a continuous loop, but requires relatively low heat — between 70 to 100 degrees Celsius (158 to 212 degrees Fahrenheit) — which could potentially come from a source of waste heat like a data center. The enabling discovery was the use of two chemicals — an amino acid and a compound called guanidine — that attract CO2 and then further concentrate it within the water, making it easier and less energy-intensive to isolate so that it can be stored securely underground.
After licensing the tech, Holocene moved quickly. Within a year, the team had built a small pilot plant in Knoxville, Tennessee that’s capable of capturing about 10 tons of CO2 annually. That’s, of course, a totally insignificant amount, but it’s enough for the team to demonstrate its approach to potential funders and to keep testing variations on the basic chemistry to refine the system, Timofte told me.
Timofte said the company has made it this far with just over $6 million in grants and prizes from the Department of Energy, Bill Gates’ Breakthrough Energy, and Frontier Climate, a coalition of carbon removal buyers that includes Google in addition to other tech companies. The $500,000 that Holocene got from Frontier was technically a pre-purchase of 332 tons of removal, which would put the current cost per ton at roughly $1,500.
Frontier’s pre-purchases are not a precise indicator of price as they are meant to “pressure-test the viability of novel CDR solutions,” and are granted with the expectation that some ventures will fail. Still, even with a fresh influx of cash from Google and the prospect of a $180 per ton tax credit from the federal government, the company has a steep climb ahead. Timofte told me the team is beginning to fundraise to build their next project — a 2,000- to 5,000-ton per year demonstration plant. When asked about how it reached the $100 per ton deal with Google, she stressed that having a delivery date past 2030 was crucial to the deal.
The industry’s fixation on achieving $100 per ton is somewhat arbitrary. A 2019 National Academies of Sciences report found that estimates of the cost of capturing CO2 via direct air capture spanned “an order of magnitude, from $100 to $1,000” per ton. In 2021, the Biden administration’s Department of Energy set a goal to bring the cost of all kinds of carbon removal below $100 per ton, which seemed to solidify the goal across the field. In 2022, the nonprofit CarbonPlan surveyed carbon removal buyers, suppliers, and brokers, and found that $100 per ton was a common benchmark. “If cost were $100/ton, demand would be practically unlimited,” one supplier said. “Bringing down cost to $100/ton for CDR would be the sweet spot,” said a buyer. CarbonPlan pointed out, however, that the responses weren’t consistent on whether $100 per ton was the desired break-even point for carbon removal companies or the desired price for buyers.
“I think we focus too much on the cost of DAC,” Erin Burns, the executive director of the nonprofit Carbon180 told me when I asked her if $100 per ton was a meaningful goal. “Sure, DAC should and will get cheaper. But we need to also be thinking, right now, about things like renewable energy availability, infrastructure, and reducing emissions as quickly as possible.”
Finding clean sources of power for direct air capture is becoming more of an issue as companies try to scale. At the end of August, a startup called CarbonCapture Inc. announced it would try to relocate a commercial-scale project it had planned to build in Wyoming because it was struggling to procure enough clean energy to power the plant due to competition with data centers and cryptocurrency miners.
Timofte agreed that “clean electrons are hard to come by,” but added that Holocene’s potential to use waste heat might make it a little easier for the company.
“I don't want to dismiss the challenge. I think this is the challenge that everyone faces. We each have to solve it, and the solutions are going to be individual.”
On weather in the Gulf, Fervo’s big news, and rainy cities
Current conditions: A year’s worth of rain fell in just two days in southern Morocco • A single dropped Cheetos bag disrupted the delicate ecosystem of a large cave at New Mexico’s Carlsbad Caverns National Park • It will be about 75 degrees Fahrenheit and clear this evening in Philadelphia, where Kamala Harris and Donald Trump will take the stage for the first 2024 presidential debate.
A hurricane warning is in effect for parts of the Louisiana coast as Tropical Storm Francine approaches. The storm is expected to strengthen into a Category 2 hurricane today and make landfall in Louisiana tomorrow. It could bring 10 feet of storm surge and up to 12 inches of rain, triggering flash floods in the state, as well as in Texas and Mississippi. Several towns along the Louisiana coast have issued evacuation orders. Oil and gas producers in the Gulf of Mexico are evacuating their staff from offshore platforms. The storm follows a similar path to that of Hurricane Beryl, which knocked out power to millions of Texans for days. The 2024 Atlantic hurricane season, which peaks today, has been less active in recent weeks than forecasters had expected despite incredibly warm ocean temperatures. Some meteorologists worry climate change is making it harder to make long-term hurricane predictions.
NOAA
The enhanced geothermal startup Fervo said today that it had “achieved record-breaking commercial flow rates,” a measure of how much water can move through an enhanced geothermal system, at its Utah site, Cape Station. According to Fervo’s announcement, the project generated 10 megawatts over a 30-day test, which substantially outpaces targets set for enhanced geothermal energy as far out as 2035. The Cape Station site is scheduled to have 400 megawatts of capacity by 2028, with power beginning to flow to customers – including Southern California Edison, which this summer contracted with Fervo for 320 megawatts over 15 years – in 2026. Fervo also announced that it had raised $100 million from X-Caliber Rural Capital for the project.
Enhanced geothermal borrows fracking techniques from oil and gas drilling, pumping fluid underground to create or expand fissures in hot rocks, thus creating the hot fluid necessary for geothermal energy production. This process could vastly expand the potential for generating geothermal energy beyond existing pools of underground hot water and steam. In February, the company announced it had reduced its drilling time by 70% in the past year, a key step to making the process more economical.
A group of Democratic lawmakers said oil and gas companies have not been cooperating with a congressional investigation into an alleged “quid pro quo” offer from former President Donald Trump, according to Bloomberg. The probe is looking into an April meeting at Mar-a-Lago where Trump reportedly offered to roll back environmental rules as a favor to fossil fuel companies in exchange for $1 billion in donations to his 2024 presidential campaign. In letters made public today, leaders of the Senate budget and finance panels and the House Committee on Oversight and Accountability said companies including Chevron, Exxon Mobil, Occidental Petroleum, and others had given “woefully inadequate” responses to inquiries in the investigation.
Since 2022, more than 400 million students across the globe have missed school because of extreme weather linked to the climate crisis, according to a report from the World Bank. The problem is especially acute in low-income countries, where children miss 18 school days each year on average because of events like drought, floods, and extreme heat. That’s compared to 2.4 days lost each year in wealthier nations. The report points to the link between education and overall awareness of the climate crisis and its causes. It finds that education makes people more climate aware, more adaptive, more likely to engage in pro-climate behavior, and more likely to change mindsets in their communities with conversations around climate change. And of course, it says education is essential for training people in the skills needed for the green transition. The analysis calls for governments to invest in helping schools adapt, and says such efforts could cost as little as $18.51 per student.
The built-up environments of cities affect the local weather, according to a new study. Specifically, the research found that urban areas receive more rain in a year than surrounding rural landscapes, and this effect is stronger in cities that are hotter, more populated, and more polluted. “Cities can make a storm on steroids,” Dev Niyogi, a professor of earth and planetary sciences at the University of Texas at Austin and one of the study’s authors, toldBloomberg. About 70% of the world’s population is expected to live in cities by 2050. The new findings can help inform urban planners as they look for ways to upgrade infrastructure in a changing climate.
A 10-year-old in 2024 will experience 36 times more heat waves over the span of their life compared to a 10-year-old in 1970.
The PJM Interconnection can’t seem to figure out supply and demand anymore, which could be good news for natural gas.
Here’s a dilemma: Large chunks of fossil fuel-powered energy generation are scheduled to fall off the U.S. electric grid in the next decade thanks to economic and regulatory pressures. Even larger chunks of renewable energy generation have not yet been approved to connect to the grid and may not be for years, if ever. Meanwhile, data centers and electrification have kicked off the first notable demand growth for electricity markets in over 20 years. On top of all that, the grid has become increasingly vulnerable to climate change-fueled disruptions, whether from solar power being knocked out by hail or natural gas lines freezing in an ice storm.
In some parts of the country, the solution to this dilemma is relatively simple. In much of the Southeast and -west, large utilities that own power plants are simply building more natural gas power plants. In California, regulators are mandating that utilities procure enormous amounts of energy storage, and have rejiggered residential solar rules to encourage more combinations of solar panels and batteries. And Texas is planning to lend billions of dollars at low interest rates to help finance natural gas plant construction.
Then there’s the PJM Interconnection, the 13-state electricity market serving much of the East Coast and Midwest, run by the country’s largest regional transmission organization. Despite PJM’s constant warnings about natural gas and coal generation retiring, it has not been able to bring new generating resources online in a reasonable timeframe. The grid operator — technically a non-profit — has neither the regulatory muscle nor the financial firepower to shape new energy generation to its preferences; its interconnection queue got so long, it instituted a two-year pause on new applications.
While many of PJM’s problems are unique to its particular circumstances, they’ve gotten so severe in recent months, it calls into question whether the decades-long project of structuring electricity generation, transmission, and distribution into something like a market is even working anymore.
“The whole premise is that a capacity market is about efficient entry and efficient exit,” Abe Silverman, an assistant research scholar at Johns Hopkins and former New Jersey utility regulatory official, told me. “We’re squeezing the tube on the entry side and letting very few new entrants in.”
According to PJM’s independent market monitor, at the end of last year, there were just over 7 gigawatts of natural gas projects in the queue, about half of which it expected to go into service eventually, while some 24 gigawatts to 58 gigawatts of coal and natural gas is expected to retire by 2030. There were over 200 gigawatts of renewables projects in the queue, the market monitor said, but only around 30 gigawatts that’s expected to go into service, and for the purpose of a capacity auction, only about 11 would count.
But for power market observers, the sirens really started going off at the end of July, when PJM held what’s called a capacity auction, which determines the price companies get paid to supply energy-generating capacity over and above forecasted peak demand in order to avoid blackouts. By the end of the five-day process, the cost of that capacity came out almost 10 times higher for than the previous PJM capacity auction — $14.7 billion, compared to just over $2 billion in 2022 — a signal that supply, demand, and reliability dynamics within PJM are seriously imbalanced.
That almost certainly means rate increases for consumers. In Maryland specifically, some residential electricity bills could rise anywhere from 2% to 24%, a monthly change of $4 to $18, according to the state’s Office of People’s Counsel.
What that almost certainly does not mean is a huge amount of new generation coming online. “In an efficient capacity market structure, the market starts sending higher price signals and generators start coming on-line,” Silverman told me. “Usually when you see high prices, you would expect more of a response from the supply side.”
In PJM, however, “new generation cannot come online quickly,” according to a letter from a group of consumer advocates in PJM states, therefore “the high capacity market prices are not an effective signal for new entry but instead a windfall for the owners of existing generation.”
Ironically, the high prices were due, in part, to PJM applying a formula it typically reserves for renewables to coal and gas plants, which “derates” the capacity they’re able to offer in times of stress, e.g. during a winter storm. Historically, coal and gas got high ratings because high winds and cold temperatures was considered unlikely to disrupt their production, while solar and wind scored much lower. But after 2022's Winter Storm Elliott, during which natural gas lines froze and caused a mass blackout, PJM knocked down the rating for combined cycle gas plants — the most efficient kind of gas plant, which recaptures heat exhaust to produce more power — from 96% to 79%, and for combustion turbine natural gas plants from 90% to 62%. Wind got a bump, while solar was rated down.
In other words, “PJM doesn’t view all these megawatts as reliably as they did before Elliott,” Nicolas Freschi, a senior associate at Gabel Associates, which does energy and environmental consulting for federal agencies, told me. That meant some 26 gigawatts of projected coal and gas capacity disappeared from the auction, according to S&P Global Commodity Insights.
The environmental activist community has long argued that gas is less reliable than utilities and the public seem to think it is, and that this should be taken into account with grid planning. The gas derating was “a good thing,” Claire Lang-Ree of the Natural Resources Defense Council told me, “because that means what we're paying for in this auction is actually reliable. It's a truing-up of the system.”
At the same time, she acknowledged, the auction result was “a bad thing insofar as it was the driving cause of the price spike,” which also means huge payouts for power companies.
“Despite the decrease in capacity credit, the higher capacity prices will impact the capacity revenue received for projects in PJM, generally increasing it,” S&P analysts wrote in August. By way of example, S&P looked at one natural gas plant in Ohio and found that its project per-megawatt-hour net revenue in 2026 would increase by 40%.
Morgan Stanley estimated that major power producers such as Texas-based Vistra and Maryland’s Constellation Energy would see a boost to their earnings before interest, taxes, and amortization of $700 million to $800 million each.
And yet in both Texas and PJM, many analysts (not to mention the gas industry) still see gas as the solution to a shortfall exacerbated by gas’s documented vulnerability. That’s due to its ability — at least on paper — to generate large amounts of power at any time of day.
So far, however, only one power producer with a large natural gas fleet, Calpine, has publicly indicated that it will aggressively pursue development in PJM. Calpine operates a 76-facility fleet that includes 66 fossil fuel-fired plants from California to Massachusetts. “The PJM market needs and values reliable, dispatchable, non-duration-limited power” the company said in a press release. (These are all industry code words for natural gas.) Calpine said it was “accelerating its PJM electricity generation development program following market signals indicating higher demand for reliable power,” and that it was looking at “multiple new locations in the PJM region, particularly in Ohio and Pennsylvania.”
Other companies have been more cautious. “It is only one auction, of course, and not long enough out in the future to be starting a new project,” Vistra chief executive Jim Burke said in an August earnings call. Morgan Stanley analysts noted that because the next auction is in December, “we don't foresee enough time to build significant new generation capacity. There are only 18 months between the auction and the start of the delivery year, which doesn’t leave time for permitting, interconnection queue timing, and construction because they are behind.”
S&P forecast that only one natural gas project under construction in Ohio could possible bid into the next auction. And while stock and bond analysts are more focused on the prospects for new natural gas plants, they are not particularly optimistic they’ll come online any time soon. “Merchant newbuilds remain marginal under our assumptions, indicating price signals may need to improve further to incent merchant new entry,” Guggenheim analyst Shahriar Pourreza wrote in a note.
Todd Snitchler, the head of the independent power generator trade group Electric Power Supply Association, noted to me that the July auction price was “coming off a record low,” and that the “abnormally” low prices in the previous two auctions — which were then followed by a lengthy delay — “suggested that assets should be leaving, and not coming on” — a trend PJM and other electricity market overseers have been warning about for years.
“One auction does not make a trend make,” Snitchler said.
If prices stay high, however, some analysts think power producers will eventually start trying to build new natural gas plants in PJM. “Investors don’t want to start building extremely expensive projects until they’re sure this price environment is sustainable,” Freschi told me.
Instead of beckoning new gas construction, clean energy and ratepayer advocates want PJM to focus on interconnection reform so that its existing queue — which is overwhelming renewables — can finally make its way onto the grid.
In a statement to Heatmap, PJM said its new system of evaluating projects in groups instead of on a first-come, first-served basis will lead to 230,000 megawatts being processed over the next three years. The PJM spokesperson also pointed to Calpine's announcement as a sign that the capacity auction was bringing new investment.
“We need investment in real projects that can get connected to the grid quickly, as opposed to the speculative projects that have clogged the queue in the past,” the spokesperson said. “Our reformed interconnection process encourages projects with the best chance of being built, and we are weeding out some of those that have been hanging on for years past receiving an interconnection agreement from PJM and who have not moved to construction.”
“Generators should submit their new project queue positions today,” the spokesperson added.
But like so many projects clogging the queue, these reforms are speculative, and in the end the restructured market, where new supply supposedly responds to high prices, simply may not work on its own terms. Some of this is due to policy in PJM states — you’re unlikely to be able to build a new natural gas plant in Democratic-controlled states like Maryland, New Jersey, or Illinois, and Guggenheim’s Pourreza wrote that “any new gas generation will be clustered in [Pennsylvania, Ohio, and West Virginia],” which could both lead to lower capacity prices in some areas and a more unbalanced market as new gas capacity becomes concentrated geographically.
But even in areas that are famously friendly to fossil fuels and have less complicated market and interconnection processes, demand for new gas has not smoothly resulted in gas plant construction. In Texas, which has closest thing to a free electricity market that exists in the United States, the state has had to turn to a multibillion low interest rate financing program to entice developers to build new natural gas plants.
May that be a warning to regional transmission planners everywhere. As S&P analysts wrote, “High prices signal the need for new generation, but do not guarantee it.”