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When Donald Trump met with a group of oil executives at Mar-a-Lago last month, his message was somewhere between “refreshingly blunt” and “blatant shakedown.” Attendees
spilled to The Washington Post that Trump told the executives they should raise a billion dollars for his campaign so he could make them even richer by reducing their taxes and removing regulations on their industry.
One can’t help but wonder if any of them thought to themselves that as appealing as that kind of deal might be, there’s no reason for them to be desperate. After all, the Biden years have actually been quite good for the fossil fuel industry.
That applies to the fossil fuel industry’s political allies as well: While Republicans are appalled at the enormous sums the administration and congressional Democrats have directed to renewable energy development and other climate-focused programs, fossil fuels are doing just fine. In the immediate term, the president’s political opponents can barely find anything to complain about, which was probably key to the Biden administration’s political strategy all along.
Republican frustration was on clear display at a
hearing Thursday of the House Committee on Oversight and Accountability, where GOP members went through the motions of grilling Secretary of Energy Jennifer Granholm over what they like to call “the Biden administration’s war on energy.” Their attempts to portray the administration’s throttling the production of fossil fuels were so absurd that at times Granholm seemed to struggle to keep from laughing out loud. One member was upset about the demise of incandescent light bulbs. Another said they “know a guy” who, for some reason, had to pay $8,000 to put an electric vehicle charger in his garage (the secretary was at a loss to explain that). And a third wanted to know whether the DOE is reverse-engineering technology from unidentified aerial phenomena, what we used to refer to call UFOs (the secretary didn’t give much of an answer — clearly she’s in on the conspiracy).
“Can you clarify whether the Department of Energy has been involved in any such efforts either historically or currently to analyze reverse-engineering materials from or related to UAPs?” asked Rep. Anna Paulina Luna of Florida.
“I have no knowledge of that,” Granholm replied.
“There have been documented sightings of metallic spheres over DOE facilities,” Luna continued later. “What investigations have been conducted in regards to these sightings and what conclusions do you guys have about the nature and origins of these objects?”
“I’d be happy to follow up with you on that,” Granholm replied diplomatically.
Predictable congressional buffoonery notwithstanding, this is the curious situation in which we find ourselves: On one hand, this administration has done more to advance green energy than any that came before. The 2022 Inflation Reduction Act was the most significant piece of climate legislation in history, and if the administration’s climate initiatives are successful, this could be the key turning point in America’s contribution to climate change. On the other hand, the U.S. has never exported more oil than it
did last year and overtook Australia and Qatar to become the world’s leading producer of liquified natural gas. The fossil fuel industry has been booming since Joe Biden took office, and still is.
The immediate topic of the Oversight Committee hearing was the administration’s decision to pause new approvals for liquid natural gas export projects so it can complete a review of the analysis that underpins those approvals. The pause doesn’t affect existing exports or projects under construction, but it has been hailed by many climate activists as an important step in the right direction.
The administration has
framed the pause in the context of its climate efforts, and the environmental impact of LNG is complicated; while burning gas creates lower emissions than burning coal or oil, the processes involved in exporting LNG — lowering the temperature of the gas until it becomes a liquid, moving it onto boats, moving the boats across the ocean, turning the liquid back into a gas — create their own emissions that make LNG not a particularly climate-friendly option.
In addition, there’s the question of environmental justice. “It is deeply disturbing to me that fossil fuel production is at a record high under the current administration,” said Rep. Rashida Tlaib at the hearing, noting the high rates of asthma and cancer in the area she grew up in and represents in Detroit. “LNG exports perpetuate, I think, systematic environmental racism,” she said, noting that the processing facilities are often sited in areas that are mostly minority and poor.
Nevertheless, the temporary pause on new approvals won’t hinder the booming LNG industry much, especially in the short run. As Granholm said, “We have exploded in our authorizations. This pause only applies to new ones coming down the pike.” The U.S. exported 88.9 million metric tons of LNG
in 2023; just eight years ago exports were almost nothing.
And yet keep repeating “War on energy!” knowing that facts seldom play too much of a role in political persuasion.
Polling shows that more voters trust Donald Trump on a range of questions related to energy production and prices, and the imaginary lack of fossil fuel production is such an urgent problem to solve that Trump has promised that he will be a dictator on “day one” in order to do two things: “I want to close the border, and I want to drill, drill, drill.”
It can appear to be the best of both worlds for Republicans: They get the fossil fuel production they want, and outside of a hearing room where they can be directly shot down, they can still make at least some political hay out of energy. They would probably add that while oil and gas production is up at the moment, Democrats are still hoping to phase out fossil fuels over the long run. Which is true.
Democrats have the harder political task: They want to show that they’re addressing climate change, but in a way that doesn’t cause any inconvenience or higher retail prices for gasoline. That has always been part of the green energy dream — that we could get more energy for less money, even as we’re saving the planet. In some ways that’s what’s happening as the price of renewables has continued to drop. But all it takes is a momentary spike in gasoline prices to send angry voters back into the arms of whoever promises to bring them down.
This week’s Funding Friday is light on the funding but heavy on the deals. In the past few days, electric carmaker Rivian and virtual power plant platform EnergyHub teamed up to integrate EV charging into EnergyHub’s distributed energy management platform; the power company AES signed 20-year power purchase agreements with Google to bring a Texas data center online; and microgrid company Scale acquired Reload, a startup that helps get data centers — and the energy infrastructure they require — up and running as quickly as possible. Even with venture funding taking a backseat this week, there’s never a dull moment.
Rivian Partners with EnergyHub for Grid-Friendly EV Charging
Ahead of the Rivian R2’s launch later this year, the EV-maker has partnered with EnergyHub, a company that aggregates distributed energy resources into virtual power plants, to give drivers the opportunity to participate in utility-managed charging programs. These programs coordinate the timing and rate of EV charging to match local grid conditions, enabling drivers to charge when prices are low and clean energy is abundant while avoiding periods of peak demand that would stress the distribution grid.
As Seth Frader-Thompson, EnergyHub’s president, said in a statement, “Every new EV on the road is a win for drivers and the environment, and by managing charging effectively, we ensure this growth remains a benefit for the grid as well.”
The partnership will fold Rivian into EnergyHub’s VPP ecosystem, giving the more than 150 utilities on its platform the ability to control when and how participating Rivian drivers charge. This managed approach helps alleviate grid stress, thus deferring the need for costly upgrades to grid infrastructure such as substations or transformers. Extending the lifespan of existing grid assets means lower electricity costs for ratepayers and more capacity to interconnect new large loads — such as data centers.
AES to Deliver 20 Years of Clean Power for Google Data Center
Google seems to be leaning hard into the “bring-your-own-power” model of data center development as it looks to gain an edge in the AI race.
The latest evidence came on Tuesday, when the power company and utility operator AES announced a partnership with the hyperscaler to provide on-site power for a new data center in Texas. signing 20-year power purchase agreements. AES will develop, own, and operate the generation assets, as well as all necessary electricity infrastructure, having already secured the land and interconnection agreements to bring this new power online. The data center is set to begin operations in 2027.
As of yet, neither company has disclosed the exact type of energy infrastructure that AES will be building, although Amanda Peterson Corio, Google’s head of data center energy, said in a press release that it will be “clean.”
“In partnership with AES, we are bringing new clean generation online directly alongside the data center to minimize local grid impact and protect energy affordability,” she said.
This announcement came the same day the hyperscaler touted a separate agreement with the utility Xcel Energy to power another data center in Minnesota with 1.6 gigawatts of solar and wind generation and 300 megawatts of long-duration energy storage from the iron-air battery startup Form Energy.
Scale Acquires Reload to Fast-Track Power-Ready Sites for Hyperscalers
The microgrid developer Scale has acquired Reload, a “powered land” startup founded in 2024, for an undisclosed sum. What is “powered land”? Essentially, it’s land that Reload has secured and prepared for large data centers customers, obtaining permits and planning for onsite energy infrastructure such that sites can be energized immediately. This approach helps developers circumvent the years-long utility interconnection queue and builds on Scale’s growing focus on off-grid data center projects, as the company aims to deliver gigawatts of power for hyperscalers in the coming years powered by a diverse mix of sources, from solar and battery storage to natural gas and fuel cells.
Early last year, the Swedish infrastructure investor EQT acquired Scale. The goal, EQT said, was to enable the company “to own and operate billions of dollars in distributed generation assets.” At the time of the acquisition, Scale had 2.5 gigawatts of projects in its pipeline. In its latest press release the company announced it has secured a multi-hundred-megawatt contract with a leading hyperscaler, though it did not name names.
As Jan Vesely, a partner at EQT said in a statement, “By bringing together Reload’s campus development capabilities, Scale’s proven islanded power operating platform, and EQT’s deep expertise across energy, digital infrastructure and technology, we are supporting a more integrated approach to delivering power for next-generation digital infrastructure today.”
Bonus: Shine Technologies Nabs $240 in New Funding
Not to say there’s been no funding news to speak of!
As my colleague Alexander C. Kaufman reported in an exclusive on Thursday, fusion company Shine Technologies raised $240 million in a Series E round, the majority of which came from biotech billionaire Patrick Soon-Shiong. Unlike most of its peers, Shine isn’t gunning to build electricity-generating reactors anytime soon. Instead, its initial focus is producing valuable medical isotopes — currently made at high cost via fission — which it can sell to customers such as hospitals, healthcare organizations, or biopharmaceutical companies. The next step, Shine says, is to scale into recycling radioactive waste from spent fission fuel.
“The basic premise of our business is fusion is expensive today, so we’re starting by selling it to the highest-paying customers first,” the company’s CEO, Greg Piefer told Kaufman, calling electricity customers the “lowest-paying customer of significance for fusion today.”
Current conditions: A rain storm set to dump 2 inches of rain across Alabama, Tennessee, Georgia, and the Carolinas will quench drought-parched woodlands, tempering mounting wildfire risk • The soil on New Zealand’s North Island is facing what the national forecast called a “significant moisture deficit” after a prolonged drought • Temperatures in Odessa, Texas, are as much as 20 degrees Fahrenheit hotter than average.
THE TOP FIVE
1. Trump’s plan to build 10 new large reactors is making headway
For all its willingness to share in the hype around as-yet-unbuilt small modular reactors and microreactors, the Trump administration has long endorsed what I like to call reactor realism. By that, I mean it embraces the need to keep building more of the same kind of large-scale pressurized water reactors we know how to construct and operate while supporting the development and deployment of new technologies. In his flurry of executive orders on nuclear power last May, President Donald Trump directed the Department of Energy to “prioritize work with the nuclear energy industry to facilitate” 5 gigawatts of power uprates to existing reactors “and have 10 new large reactors with complete designs under construction by 2030.” The record $26 billion loan the agency’s in-house lender — the Loan Programs Office, recently renamed the Office of Energy Dominance Financing — gave to Southern Company this week to cover uprates will fulfill the first part of the order. Now the second part is getting real. In a scoop on Thursday, Heatmap’s Robinson Meyer reported that the Energy Department has started taking meetings with utilities and developers of what he said “would almost certainly be AP1000s, a third-generation reactor produced by Westinghouse capable of producing up to 1.1 gigawatts of electricity per unit.”
Reactor realism includes keeping existing plants running, so notch this as yet more progress: Diablo Canyon, the last nuclear station left in California, just cleared the final state permitting hurdle to staying open until 2030, and possibly longer. The Central Coast Water Board voted unanimously on Thursday to give the state’s last nuclear plant a discharge permit and water quality certification. In a post on LinkedIn, Paris Ortiz-Wines, a pro-nuclear campaigner who helped pass a 2022 law that averted the planned 2025 closure of Diablo Canyon, said “70% of public comments were in full support — from Central Valley agricultural associations, the local Chamber of Commerce, Dignity Health, the IBEW union, district supervisors, marine meteorologists, and local pro-nuclear organizations.” Starting in 2021, she said, she attended every hearing on the bill that saved the plant. “Back then, I knew every single pro-nuclear voice testifying,” she wrote. “Now? I’m meeting new ones every hearing.”
2. Trump’s solar siege may be coming to an end
It was the best of times, it was the worst of times. It was a year of record solar deployments, it was a year of canceled solar megaprojects, choked-off permits, and desperate industry pleas to Congress for help. But the solar industry’s political clouds may be parting. The Department of the Interior is reviewing at least 20 commercial-scale projects that E&E News reported had “languished in the permitting pipeline” since Trump returned to office. “That includes a package of six utility-scale projects given the green light Friday by Interior Secretary Doug Burgum to resume active reviews, such as the massive Esmeralda Energy Center in Nevada,” the newswire reported, citing three anonymous career officials at the agency.
Heatmap’s Jael Holzman broke the news that the project, also known as Esmeralda 7, had been canceled in October. At the time, NextEra, one of the project’s developers, told her that it was “committed to pursuing our project’s comprehensive environmental analysis by working closely with the Bureau of Land Management.” That persistence has apparently paid off. In a post on X linking to the article, Morgan Lyons, the senior spokesperson at the Solar Energy Industries Association, called the change “quite a tone shift” with the eyes emoji. GOP voters overwhelmingly support solar power, a recent poll commissioned by the panel manufacturer First Solar found. The MAGA coalition has some increasingly prominent fans. As I have covered in the newsletter, Katie Miller, the right-wing influencer and wife of Trump consigliere Stephen Miller, has become a vocal proponent of competing with China on solar and batteries.
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3. America’s only active rare earths miner is opening a Texas factory
MP Materials operates the only active rare earths mine in the United States at California’s Mountain Pass. Now the company, of which the federal government became the largest shareholder in a landmark deal Trump brokered earlier this year, is planning a move downstream in the rare earths pipeline. As part of its partnership with the Department of Defense, MP Materials plans to invest more than $1 billion into a manufacturing campus in Northlake, Texas, dedicated to making the rare earth magnets needed for modern military hardware and electric vehicles. Dubbed 10X, the campus is expected to come online in 2028, according to The Wall Street Journal.
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4. New York’s climate law will cost upstaters twice as much as city people
New York’s rural-urban divide already maps onto energy politics as tensions mount between the places with enough land to build solar and wind farms and the metropolis with rising demand for power from those panels and turbines. Keeping the state’s landmark climate law in place and requiring New York to generate the vast majority of its power from renewables by 2040 may only widen the split. That’s the obvious takeaway from data from the New York State Energy Research and Development Authority. In a memo sent Thursday to Governor Kathy Hochul on the “likely costs of” complying with the law as it stands, NYSERDA warned that the statute will increase the cost of heating oil and natural gas. Upstate households that depend on fossil fuels could face hikes “in excess of $4,000 a year,” while New York City residents would see annual costs spike by $2,300. “Only a portion of these costs could be offset by current policy design,” read the memo, a copy of which City & State reporter Rebecca C. Lewis posted on X.
5. Support for data centers is nosediving
Last fall, this publication’s energy intelligence unit Heatmap Pro commissioned a nationwide survey asking thousands of American voters: “Would you support or oppose a data center being built near where you live?” Net support came out to +2%, with 44% in support and 42% opposed. Earlier this month, the pollster Embold Research ran the exact same question by another 2,091 registered voters across the country. The shift in the results, which I wrote about here, is staggering. This time just 28% said they would support or strongly support a data center that houses “servers that power the internet, apps, and artificial intelligence” in their neighborhood, while 52% said they would oppose or strongly oppose it. That’s a net support of -24% — a 26-point drop in just a few months.
Among the more interesting results was the fact that the biggest partisan gap was between rural and urban Republicans, with the latter showing greater support than any other faction. When I asked Emmet Penney at the right-leaning Foundation for American Innovation to make sense of that for me, he said data centers stoke a “fear of bigness” in a way that compares to past public attitudes on nuclear power.
THE KICKER
A Gulf coast pipeline boom.EIA
Gas pipeline construction absolutely boomed last year in one specific region of the U.S. Spanning Texas, Oklahoma, Kansas, Arkansas, Louisiana, Mississippi, and Alabama, the so-called South Central bloc saw a dramatic spike in intrastate natural gas pipelines, more than all other regions combined, per new Energy Information Administration data.It’s no mystery as to why. The buildout of liquified natural gas export terminals along the Gulf coast needs conduits to carry fuel from the fracking fields as far west as the Texas Permian.
As electricity affordability has risen in the public consciousness, so too has it gone up the priority list for climate groups — although many of their proposals are merely repackaged talking points from past political cycles. But are there risks of talking about affordability so much, and could it distract us from the real issues with the power system?
Rob is joined by Jane Flegal, a senior fellow at the Searchlight Institute and the States Forum. Flegal was the former senior director for industrial emissions at the White House Office of Domestic Climate Policy, and she has worked on climate policy at Stripe. She was recently executive director of the Blue Horizons Foundation.
Shift Key is hosted by Robinson Meyer, the founding executive editor of Heatmap News.
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Here is an excerpt from their conversation:
Robinson Meyer: What’s interesting is the scarcity model is driven by the fact that ultimately rate payers that is utility customers are where the buck stops, and so state regulators don’t want utilities to overbuild for a given moment because ultimately it is utility customers — it’s people who pay their power bills — who will bear the burden of a utility overbuilding. In some ways, the entire restructured electricity market system, the entire shift to electricity markets in the 90s and aughts, was because of this belief that utilities were overbuilding.
And what’s been funny is that, what, we started restructuring markets around the year 2000. For about five or six or seven years. Wall Street was willing to finance new electricity. I mean, I hear two stories here — basically it’s another place where I hear two stories, and I think where there’s a lot of disagreement about the path forward on electricity policy, in that I’ve heard a story that, basically, electricity restructuring starts in the late 90s you know year 2000, and for five years, Wall Street is willing to finance new power investment based entirely on price risk based entirely on the idea that market prices for electricity will go up. Then three things happen: The Great Recession, number one, wipes out investment, wipes out some future demand.
Number two, fracking. Power prices tumble, and a bunch of plays that people had invested in, including then advanced nuclear, are totally out of the money suddenly. Number three, we get electricity demand growth plateaus, right? So for 15 years, electricity demand plateaus. We don’t need to finance investments into the power grid anymore. This whole question of, can you do it on the back of price risk? goes away because electricity demand is basically flat, and different kinds of generation are competing over shares and gas is so cheap that it’s just whittling away.
Jane Flegal: But this is why that paradigm needs to change yet again. Like ,we need to pivot to like a growth model where, and I’m not, again —
Meyer: I think what’s interesting, though, is that Texas is the other counterexample here. Because Texas has had robust load growth for years, and a lot of investment in power production in Texas is financed off price risk, is financed off the assumption that prices will go up. Now, it’s also financed off the back of the fact that in Texas, there are a lot of rules and it’s a very clear structure around finding firm offtake for your powers. You can find a customer who’s going to buy 50% of your power, and that means that you feel confident in your investment. And then the other 50% of your generation capacity feeds into ERCOT. But in some ways, the transition that feels disruptive right now is not only a transition like market structure, but also like the assumptions of market participants about what electricity prices will be in the future.
Flegal: Yeah, and we may need some like backstop. I hear the concerns about the risks of laying early capital risks basically on rate payers in the frame of growth rather than scarcity. But I guess my argument is just there’s ways to deal with that. Like we could come up with creative ways to think about dealing with that. And I’m not seeing enough ideation in that space, which — I would like, again, a call for papers, I guess — that I would really like to get a better handle on.
The other thing that we haven’t talked about, but that I do think, you know, the States Forum, where I’m now a senior fellow, I wrote a piece for them on electricity affordability several months ago now. But one of the things that doesn’t get that much attention is just like getting BS off of bills, basically. So there’s like the rate question, but then there’s the like, what’s in a bill? And like, what, what should or should not be in a bill? And in truth, you know, we’ve got a lot of social programs basically that are being funded by the rate base and not the tax base. And I think there are just like open questions about this — whether it’s, you know, wildfire in California, which I think everyone recognizes is a big challenge, or it’s efficiency or electrification or renewable mandates in blue states. There are a bunch of these things and it’s sort of like there are so few things you can do in the very near term to constrain rate increases for the reasons we’ve discussed.
You can find a full transcript of the episode here.
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A Gulf coast pipeline boom.EIA
