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Sparks

Europe Will Be Stuck With American Natural Gas For Decades

The European Commission’s director general for energy lets the cat out of the bag.

Natural gas pipelines.
Heatmap Illustration/Getty Images

When Russia launched its full-scale invasion of Ukraine last year, Europe had to scramble for natural gas from a country that much of the continent wasn’t in a proxy war against. American liquefied natural gas exporters were more than happy to step up, with exports to Europe rising some 141 percent from 2021 to 2022.

And it appears like the European dependence on natural gas exports from the United States isn’t going away anytime soon. Bloomberg reported today that a major German utility, Uniper, has negotiated an LNG deal through the late 2030s.

Europe is stuck between its aggressive climate commitments and its enduring need for natural gas, a need that America’s booming oil-and-gas export sector is eager to fill, even as the United States finally ostensibly has a climate change policy aimed at transitioning its domestic economy to lower emissions.

Ditte Juul Jørgensen, the European Commission’s Director General for Energy, told the Financial Times “we will need some fossil molecules in the system over the coming couple of decades. And in that context, there will be a need for American energy,” indicating that despite Europe’s intensive efforts to transition to renewables, imported fossil fuels will be playing a large role in their economy even as it approaches the middle of the century.


While green-minded Europe is reaffirming its dependence on American natural gas, green groups in the United States have never been more wary of the natural gas industry, which has gone from a “bridge fuel” in the eyes of some environmentalists to a methane-leaking fracked colossus.

The influential environmental activist and writer Bill McKibben flagged in the New Yorker the upcoming licensing decision for Calcasieu Pass 2, an LNG export terminal planned to be built aside the existing Calcasieu Pass terminal in Southwest Louisiana that would export 20 million metric tons of liquefied natural gas per year. He called the project a “poster child for late-stage petrocapitalism” that “would help lock in the planet’s reliance on fossil fuels long past what scientists have identified as the breaking point for the climate system.”

Of the 9.25 million metric tons that Venture Global, the company behind the project, has said it has already contracted to sell, about a third will go to Germany.

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Sparks

The Mad Dash to Lock Down Biden’s Final Climate Dollars

Companies are racing to finish the paperwork on their Department of Energy loans.

A clock and money.
Heatmap Illustration/Getty Images

Of the over $13 billion in loans and loan guarantees that the Energy Department’s Loan Programs Office has made under Biden, nearly a third of that funding has been doled out in the month since the presidential election. And of the $41 billion in conditional commitments — agreements to provide a loan once the borrower satisfies certain preconditions — that proportion rises to nearly half. That includes some of the largest funding announcements in the office’s history: more than $7.5 billion to StarPlus Energy for battery manufacturing, $4.9 billion to Grain Belt Express for a transmission project, and nearly $6.6 billion to the electric vehicle company Rivian to support its new manufacturing facility in Georgia.

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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Sparks

Treasury Finalizes Another IRA Tax Credit Before You Know What

The expanded investment tax credit rules are out.

The Treasury Department building.
Heatmap Illustration/Getty Images

In the waning days of the Biden administration, the Treasury Department is dotting the i’s and crossing the t’s on the tax rules that form the heart of the Inflation Reduction Act and its climate strategy. Today, Treasury has released final rules for the Section 48 Investment Tax Credit, which gives project owners (and/or their tax equity partners) 30% back on their investments in clean energy production.

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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Sparks

Trump’s OMB Pick Wants to Purge the Government of ‘Climate Fanaticism’

Re-meet the once and future director of the Office of Management and Budget, Russell Vought.

Russ Vought.
Heatmap Illustration/Getty Images, Library of Congress

President-elect Donald Trump spent the Friday evening before Thanksgiving filling out nearly the rest of his Cabinet. He plans for his Treasury secretary to be a hedge fund manager who’s called the Inflation Reduction Act “the Doomsday machine for the deficit”; he’s named a vaccine safety skeptic to lead the Centers for Disease Control and Prevention; and his pick to head the Department of Labor is a Republican congresswoman who may want to ease the enforcement of child labor rules if confirmed.

And — in one of the most consequential moves yet for America’s standing in the fight to mitigate climate change — Trump also named Russ Vought to lead the Office of Management and Budget. The decision comes as no surprise — Vought served as deputy director of the OMB under Trump in 2018 and took over the top job in 2019, serving until the end of Trump’s first presidency. The strategic communications group Climate Power had been sounding the alarm on his potential return to the office since this spring, which included sharing their research on him with me.

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