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Sparks

A Hotter World is Turbocharging Our Electricity Use

The U.S. came very close to setting a new record for hourly electricity demand this summer.

An air conditioning system.
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It’s getting hotter. And when it gets really hot, everyone uses more electricity, much of which comes from fossil fuels. This is a basic dilemma facing much of the world thanks to climate change, with the United States very, very much included.

According to data from the Energy Information Administration, the U.S. had its second highest demand for electricity in a given hour this past summer, with 741,815 megawatt-hours on the grid on July 27, 2023. Temperatures were as high as 125 degrees in Death Valley that day, with local highs of 95 degrees in New York City, 94 degrees in Houston, and 96 degrees in Los Angeles. Total electricity demand was also only 889 megawatt-hours short of the record set on July 20, 2022.

Annual demand peaked last year with just over 4 trillion megawatt-hours of electricity consumed across the country, according to EIA data. That record will surely be broken in the coming years. Indeed, several electric grids had all-time usage records this past summer, including Texas’s ERCOT and several grids in Arizona.

Overall consumption will likely continue to rise, not just because of more demand for air conditioning in a warming world, but because of the policy response to warming, namely electrification. To get away from burning fossil fuels for power and heat, more cars will run off batteries and more homes will be heated and cooled with heat pumps.

All this, along with population growth, economic growth, and increased industrialization to build the renewable energy components, cars, and semiconductors policymakers want to bring back onshore, poses quite the challenge to those tasked with reducing emissions. Climate change is caused by burning fossil fuels for energy, yet our energy consumption will rise in response to climate change. The fast deployment of tremendous amounts of non-carbon-emitting energy is the only way to deal with the effects of global warming without making the problem worse.

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Sparks

Trump Promises ‘Fully Expedited’ Permitting in Exchange for $1 Billion of Investment

But ... how?

Donald Trump.
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President-elect Donald Trump on Tuesday rocked the energy world when he promised “fully expedited approvals and permits, including, but in no way limited to, all Environmental approvals” for “Any person or company investing ONE BILLION DOLLARS, OR MORE, in the United States of America,” in a post on Truth Social Tuesday.

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A clock and money.
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The acceleration represents a clear push by the outgoing Biden administration to get money out the door before President-elect Donald Trump, who has threatened to hollow out much of the Department of Energy, takes office. Still, there’s a good chance these recent conditional commitments won’t become final before the new administration takes office, as that process involves checking a series of nontrivial boxes that include performing due diligence, addressing or mitigating various project risks, and negotiating financing terms. And if the deals aren’t finalized before Trump takes office, they’re at risk of being paused or cancelled altogether, something the DOE considers unwise, to put it lightly.

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The expanded investment tax credit rules are out.

The Treasury Department building.
Heatmap Illustration/Getty Images

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The IRA-amended investment tax credit, plus its sibling production tax credit, are updates and expansion on tax policies that have been in place for decades supporting largely the solar and wind industries. To be clear, today’s announcement does not contain the final rules for the so-called “technology-neutral” clean electricity tax credits established under the IRA, which will supercede the existing investment and production tax credits beginning next year and for which all non-carbon emitting sources of energy can qualify.

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