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Politics

Chris Wright Swoops In to Defend the LPO

On a dead wind farm, a bankrupt solar company, and a possible rescue for energy funding

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Chris Wright Swoops In to Defend the LPO
Heatmap Illustration/Getty Images

Current conditions: Tropical Storm Barbara has weakened from hurricane strength and is heading northwest, away from Mexico • A heat advisory is in place for the Sacramento Valley in California, with temps expected to top 100 degrees Fahrenheit Tuesday night • Severe thunderstorms will bring heavy rain to the Southeast today.

THE TOP FIVE

1. Chris Wright is negotiating with Congress to save the LPO

If the U.S. is going to lead on nuclear power, the “best way to get shovels in the ground” is for the Department of Energy’s Loan Programs Office to provide low-cost debt, Secretary of Energy Chris Wright said during an interview at a conference on Monday. The budget reconciliation bill that passed the House last month would gut the LPO’s budget to provide such loans. Wright accused the Biden administration of abusing its lending authority and giving the office a bad name. “I’m in a little bit of a negotiation trying to keep it around,” Wright said, adding that he saw opportunities to support transmission lines and critical mineral projects in addition to nuclear. “It will be around, the question is just going to be the scale and scope of how much we can do with the Loan Programs Office.” The Senate Energy committee is expected to release its own proposal for the LPO in the budget reconciliation bill as soon as today.

Wright at the White House in April.Wright at the White House in April.Andrew Harnik/Getty Images

2. RIP Atlantic Shores

Last fall, Heatmap named Atlantic Shores, a 2,800-megawatt proposed wind farm off the coast of northern New Jersey, one of the most at-risk projects of the energy transition. Eight months later, Atlantic Shores is officially dead. The developer submitted a filing to New Jersey regulators seeking to terminate its agreement to sell power into the state. The move came after the oil giant Shell pulled out of the project in January, and the Trump administration revoked its air permits in March. The administration’s anti-wind actions have forced the company “to materially reduce its personnel, terminate contracts, and cancel planned project investments,” the filing says.

3. LCOE is so yesterday

A new report from the Clean Air Task Force argues that the “levelized cost of energy,” the dominant metric used to make financial comparisons between energy sources, is not fit for purpose in today’s discussions about meeting power demand. The calculation covers capital and operating costs, but it does not take into account increasingly important factors such as when the power is available (i.e. not at night, for solar without batteries, which represent an additional cost), and whether it will require new transmission lines or upgrades. While LCOE can illustrate that solar has gotten cheaper over time, it can’t say what will most economically serve the needs of the grid in a given region, my colleague Matthew Zeitlin explains.

4. Sunnova declares bankruptcy

Rooftop solar company Sunnova has filed for chapter 11 bankruptcy protection after laying off just over half its staff last week, its second major round of layoffs this year. The news came shortly after Solar Mosaic, a residential solar financing company, also filed for bankruptcy. Between high interest rates that are cratering demand and policy uncertainty due to proposals in Washington to kill solar subsidies, the industry is in turmoil. Sunnova asserted that the bankruptcy filing “is not expected to have a material effect on our servicing operations for existing customers.” More on what this all means for customers in my story from yesterday.

5. Opponents say Texas well application is no good

The Environmental Protection Agency on Monday proposed approving Texas’ application to regulate carbon dioxide injection wells, kicking off a 45-day comment period. If its application is approved, Texas would become the fifth state to be granted oversight of such “class VI” wells at the state level, following North Dakota, Wyoming, Louisiana, and West Virginia. Last year, a group of Texas Democrats sent a letter to the agency advising it to reject Texas’ application due to the state’s history of poor enforcement. The EPA had opened a probe into the state’s oversight of other types of injection wells after a petition from environmental groups said Texas had failed to protect groundwater. The agency will hold one virtual public hearing on the decision on July 24.

THE KICKER

Automakers are pivoting en masse to hybrids as federal support for EVs is thrown in reverse. “The unprecedented EV head-fake has wreaked havoc on product plans,” Bank of America analysts wrote in a recent report. “The next four+ years will be the most uncertain and volatile time in product strategy ever.”

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The IBEW logo.
Heatmap Illustration/Getty Images

Building trades want to build.

This desire for more and better big projects has meant that unions representing construction workers, utility linemen, operating engineers, plumbers, pipefitters, and so on have spent past decade-plus ping-ponging between praise and exasperation toward major Democratic priorities, especially when it comes to climate and energy policy.

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Nuclear’s Near-Term Fix

On Indonesia’s climate win, hacking renewables, and John Cena’s ad

Google headquarters.
Heatmap Illustration/Getty Images

Current conditions: A tropical rainstorm in the southwestern Gulf of Mexico, likely strengthening into what would become Tropical Storm Isaias, is poised to dump rain on the southeastern United States and may become the Atlantic’s first major hurricane of the year • Italy is bracing for a type of heavy rainstorm known as a nubifragio, set to soak Naples and Rome later this week • The Dome Fire in Yosemite National Park has burned about 7,000 acres, and officials determined it was sparked by humans.


THE TOP FIVE

1. Google inks a deal to uprate 11 of Constellation’s nuclear reactors

If you can’t wait a decade or more for a new Westinghouse AP1000 or one of the small modular reactors under development, your best bet to get more nuclear electricity is probably to upgrade an existing reactor to squeeze more power out of it, a process known as “uprating.” In February, the Department of Energy gave out its largest-ever loan to Southern Company to fund up to 6 gigawatts of uprates across the utility’s nuclear fleet. Last week, Amazon inked a 20-year deal with Constellation, the nation’s largest operator of nuclear reactors, to buy power from and uprate the Calvert Cliffs plant in Maryland. Google has now signed a deal with Constellation aimed at wringing out 890 megawatts of new power from 11 reactors across PJM Interconnection, the nation’s second-largest and arguably most stressed grid system. Asked whether the uprates are a sufficient replacement for building new reactors, Raiford Smith, Google’s head of power and energy for the cloud, said there was plenty of demand to go around. “New data centers are coming on at a gigawatt a clip,” he told me yesterday. “That means even with all the uprates, there’s still more to come.” Software giant Oracle also announced a deal last week to buy $300 million of nuclear power from a NextEra nuclear plant in Wisconsin to help fund its increased fuel costs.

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Podcast

The Tesla Alum Trying to Turn GM Into an American Battery Juggernaut

Rob talks with the U.S. auto giant”s VP of batteries and sustainability, Kurt Kelty.

A Denali EV.
Heatmap Illustration/General Motors

There are two big trends in the American battery sector at the moment. The first is that the electric vehicle market is deteriorating. GM, for instance, sold just 25,000 EVs in the third quarter of this year. Ford sold 6,000 EVs. Even the long-awaited return of the Chevy Bolt sold just 8,000 units — a small fraction of the vehicle’s already-limited production run. At the same time, the data center boom and the return of electricity growth is boosting batteries of all kinds not designed to power EVs.

Our guest today is in charge of navigating those opposing trends and figuring out what comes next. Kurt Kelty started his career at Panasonic in 1993, where he led the company’s battery research lab. He then went on to Tesla, helping to build the first Gigafactory. Since February 2024, he’s been vice president of battery and sustainability at GM. We talked about manufacturing generally, how the U.S. battery manufacturing sector should look, and how companies should be structured to compete globally, even though they’re making batteries for a mostly U.S. audience.

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