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A pre-print study from smoke researcher Marshall Burke and others shows how fires are eating into air quality gains.
The Greater Los Angeles area is awash in smoke and ash as multiple fires burn in and around the city. It’s too soon to assess the overall pollution impacts from this rare January event, but we know the smoke is filled with tiny particles known as PM2.5, one of the most pernicious public health villains, associated with increased risk of respiratory and heart disease and premature death.
Last year, the Environmental Protection Agency tightened the National Ambient Air Quality Standard for PM2.5 for the first time since 2012. The South Coast Air Quality District, which contains Los Angeles, is known for having some of the worst air quality in the country. State officials have already deemed it to be out of compliance — and that’s without even counting pollution from major wildfires. But new research raises questions about whether complying with the new standard will even be possible in many places due to the increasing frequency and severity of wildfires.
Marshall Burke, who published the not-yet-peer-reviewed findings in December, is a Stanford University researcher who has spent the past several years investigating how wildfires have affected PM2.5 exposure in the U.S. In a 2023 paper published in Nature, he and his co-authors found that over just six years, wildfire smoke eroded decades of air quality improvements throughout the country. The trend was particularly bad in Western states, of course — some of which saw more than half of their gains erased. The pre-print of the new paper updates those findings to include data from 2023. But it also goes deeper on what this means in light of the new air quality standards. The authors find that 34% of air monitoring stations registered PM2.5 above the regulatory limit because of smoke in at least one of the last five years.
Technically, wildfire smoke is completely unregulated. Jurisdictions can request to exclude “exceptional events,” such as days when PM2.5 spiked due to wildfire, from their calculations. But as the “smoke season” has grown longer and more places experience more days with degraded air quality due to smoke, local officials have not been requesting more exemptions. The researchers analyzed applications for exemptions since 2019, and found that they were more common on days with higher levels of wildfire smoke, but were still infrequent overall.
One reason might be that local pollution control officers don’t always recognize when smoke has pushed pollution over the limit on a particular day versus other factors. There is also a “substantial resource burden involved” in demonstrating the influence of wildfire smoke on ambient air quality, the paper says. Also, as smoke becomes more commonplace, it may be more difficult for officials to make the case that a given smoke event is “exceptional.”
In any case, if this low rate of applications for exemptions continues, many more regions may find themselves to be out of compliance with the new PM2.5 standard.
In the paper’s discussion section, the researchers posit that as wildfire smoke continues to get worse, either of two possible scenarios could play out. In the first, air quality districts affected by smoke get better at applying for exemptions and therefore achieve compliance with the Clean Air Act, even as local air quality and public health deteriorate. In the second, they find other ways to stay in compliance with the standards, such as by tightening pollution caps on power plants and factories. “Such mitigation could be cost effective in many regions where abatement costs remain low relative to the benefits of further air quality improvements,” the authors write, “but could become onerous if wildfire smoke concentrations continue to grow, as is expected under a warming climate.”
The first scenario is bleak, and the second comes with a pretty big caveat. But those aren’t the only options — we can also reduce the risk of wildfires with better land-use planning and management. Unfortunately, promising strategies like controlled burns can push PM2.5 levels over the standard, and those are not exempt from reporting the way that wildfires are — creating a perverse incentive not to do them.
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The nonprofit laid off 36 employees, or 28% of its headcount.
The Trump administration’s funding freeze has hit the leading electrification nonprofit Rewiring America, which announced Thursday that it will be cutting its workforce by 28%, or 36 employees. In a letter to the team, the organization’s cofounder and CEO Ari Matusiak placed the blame squarely on the Trump administration’s attempts to claw back billions in funding allocated through the Greenhouse Gas Reduction Fund.
“The volatility we face is not something we created: it is being directed at us,” Matusiak wrote in his public letter to employees. Along with a group of four other housing, climate, and community organizations, collectively known as Power Forward Communities, Rewiring America was the recipient of a $2 billion GGRF grant last April to help decarbonize American homes.
Now, the future of that funding is being held up in court. GGRF funds have been frozen since mid-February as Lee Zeldin’s Environmental Protection Agency has tried to rescind $20 billion of the program’s $27 billion total funding, an effort that a federal judge blocked in March. While that judge, Tanya S. Chutkan, called the EPA’s actions “arbitrary and capricious,” for now the money remains locked up in a Citibank account. This has wreaked havoc on organizations such as Rewiring America, which structured projects and staffing decisions around the grants.
“Since February, we have been unable to access our competitively and lawfully awarded grant dollars,” Matusiak wrote in a LinkedIn post on Thursday. “We have been the subject of baseless and defamatory attacks. We are facing purposeful volatility designed to prevent us from fulfilling our obligations and from delivering lower energy costs and cheaper electricity to millions of American households across the country.”
Matusiak wrote that while “Rewiring America is not going anywhere,” the organization is planning to address said volatility by tightening its focus on working with states to lower electricity costs, building a digital marketplace for households to access electric upgrades, and courting investment from third parties such as hyperscale cloud service providers, utilities, and manufacturers. Matusiak also said Rewiring America will be restructured “into a tighter formation,” such that it can continue to operate even if the GGRF funding never comes through.
Power Forward Communities is also continuing to fight for its money in court. Right there with it are the Climate United Fund and the Coalition for Green Capital, which were awarded nearly $7 billion and $5 billion, respectively, through the GGRF.
What specific teams within Rewiring America are being hit by these layoffs isn’t yet clear, though presumably everyone let go has already been notified. As the announcement went live Thursday afternoon, it stated that employees “will receive an email within the next few minutes informing you of whether your role has been impacted.”
“These are volatile and challenging times,” Matusiak wrote on LinkedIn. “It remains on all of us to create a better world we can all share. More so than ever.”
The company managed to put a positive spin on tariffs.
The residential solar company Sunrun is, like much of the rest of the clean energy business, getting hit by tariffs. The company told investors in its first quarter earnings report Tuesday that about half its supply of solar modules comes from overseas, and thus is subject to import taxes. It’s trying to secure more modules domestically “as availability increases,” Sunrun said, but “costs are higher and availability limited near-term.”
“We do not directly import any solar equipment from China, although producers in China are important for various upstream components used by our suppliers,” Sunrun chief executive Mary Powell said on the call, indicating that having an entirely-China-free supply chain is likely impossible in the renewable energy industry.
Hardware makes up about a third of the company’s costs, according to Powell. “This cost will increase from tariffs,” she said, although some advance purchasing done before the end of last year will help mitigate that. All told, tariffs could lower the company’s cash generation by $100 million to $200 million, chief financial officer Danny Abajian said.
But — and here’s where things get interesting — the company also offered a positive spin on tariffs.
In a slide presentation to investors, the company said that “sustained, severe tariffs may drive the country to a recession.” Sounds bad, right?
But no, not for Sunrun. A recession could mean “lower long term interest rates,” which, since the company relies heavily on securitizing solar leases and benefits from lower interest rates, could round in the company’s favor.
In its annual report released in February, the company mentioned that “higher rates increase our cost of capital and decrease the amount of capital available to us to finance the deployment of new solar energy systems.” On Wednesday, the company estimated that a 10% tariff, which is the baseline rate in the Trump “Liberation Day” tariffs, could be offset with a half percentage point decline in the company’s cost of capital, although it didn’t provide any further details behind the calculation.
Even in the absence of interest rate relief, a recession could still be okay for Sunrun.
“Historically, recessions have driven more demand for our products,” the company said in its presentation, arguing that because their solar systems offer savings compared to utility rates, they become more attractive when households get more money conscious.
Sunrun shares are up almost 10% today, as the company showed more growth than expected.
For what it’s worth, the much-ballyhooed decline in long-term interest rates as a result of Trump’s tariffs hasn’t actually happened, at least not yet. The Federal Reserve on Wednesday decided to keep the federal funds rate at 4.5%, the third time in a row the board of governors have chosen to maintain the status quo. The yield on 10-year treasuries, often used as a benchmark for interest rates, is up slightly since “Liberation Day” on April 2 and sits today at 4.34%, compared to 4.19% before Trump’s tariffs announcements.
Meta and Microsoft both confirmed plans to invest heavily in AI infrastructure.
Big Tech said this week that it’s going full steam ahead with building out data centers, and the power industry loves it. Since Microsoft and Meta reported their earnings for the beginning of the year on Wednesday, including announcements either reaffirming their guidance on capital expenditures or even increasing it, power sector stocks have jumped.
Shares of Vistra, which has a fleet of power plants including nuclear, natural gas, coal, and renewables, are up almost 7% in early afternoon trading. Constellation, one of the largest nuclear producers in the country, is up 8%. GE Vernova, which makes in-demand gas turbines, is up 4%. Chip designer Nvidia’s shares are up 4%.
Microsoft, which has been dogged byanalyst and media reports that it’s canceling some data center builds or slowing down its overall pace of deployment, reaffirmed its previousguidance that it would spend around $80 billion on data centers for its fiscal year. The affirmed guidance, Dan Ives of Wedbush Securities wrote in a note to clients, came “put to rest” the earlier chatter.
Meta, meanwhile, raised its guidance for capital expenditures from a range of $60 billion to $65 billion to at least $64 billion and as much as $72 billion.
Looking at these hyperscalers, as well as the data center company CoreWeave, Morgan Stanley estimates 38% annual growth in capital expenditures for cloud computing in 2025, to $392 billion — a $29 billion or 7 percentage point jump from its estimate a month ago. This increased spending will be a “boost to AI capex/power enablers.”
These companies, which make up the larger artificial intelligence supplier complex, were some of the most affected by Donald Trump’s Liberation Day tariffs announcements, as energy production ishighly sensitive to the global macroeconomy. (Not to mention power plants and power plant suppliers are themselvesoften major purchasers of foreign goods and commodities.) GE Vernova, for example, told investors last month that it would take a several hundred million hit thanks to tariffs.
But in the topsy turvy world of post “Liberation Day” markets, these companies’ investors are optimistic about the future again.
Microsoft chief executive Satya Nadella told analysts on the company’s earnings call that “we will be short power” when it comes to building out data centers, and that “I need power in specific places so that we can either lease or build at the pace at which we want.”
How that power will be provided is one of the key questions of the energy transition.
Big tech companies tend to have some kind of commitment to using renewable or low-carbon power, and are among the country’s largest voluntary purchasers of non-carbon-emitting power. Microsoft, for example,is helping pay for the planned restart of one unit of the Three Mile Island nuclear plant by agreeing to buy its power output.
There is a tight market for all sorts of power equipment right now, especially gas turbines, which will remain in short supply well into the back end of this decade based on current production plans. Renewable developers such as NextEra argue that solar, wind, and batteries make the most sense to quickly meet the needs of power-hungry data center developers and utilities because of how quickly and cheaply they can be built.“We should be thinking about renewables and battery storage as a critical bridge to when other technology is ready at scale, like new gas-fired plants,” NextEra chief executive John Ketchum said on an earnings call late last month, reversing the typical line that natural gas can serve as a “bridge fuel” to a low carbon future. “Gas turbines are in short supply and in high demand.”
In the meantime, load growth from data centers could push up power prices across the board. So even if you can’t build a new gas plant anytime soon, the one you’re operating that’s powering a data center right now is as good as gold.