Net Zero

1. GOP tax credit tensions
2. Data center competition
3. Methane madness
4. Offshore wind letdown
5. Tesla’s European headache

Hurdles ahead for EU’s Russian gas exit, and Warren Buffett’s complicated fossil fuel legacy.

GOP tax credit tensions

As Republicans in the US House of Representatives debate a new budget, tensions are rising over the fate of clean-energy tax credits. The $7,500 EV credit offered by the Inflation Reduction Act, for example, will probably get axed, Speaker Mike Johnson (R-La.) said on Tuesday.

Analysts have warned for some time that the EV credit was on thin ice. But credits for renewables, carbon capture, and other technologies remain more contentious, especially because they’ve become a critical driver of job creation in Republican-majority districts. Some 26 House Republicans issued a letter last week calling for the credits to be preserved, and at least an additional 12 have voiced some form of support for them. More details will likely be forthcoming next week when the House Ways and Means Committee is expected to release its markup of a budget reconciliation bill. In the meantime, on the flip side, some Democrats are siding with Republicans in voting to pull back California’s legal authority to set its own strict vehicle emissions standards.

Power companies get creative

The energy company that Google is counting on to power some of its US data center buildout is making a play for more Big Tech clients by expanding its services beyond just operating power plants.

When it comes to building and powering data centers, Google and its peers care about speed more than anything else, Sheldon Kimber, CEO of Intersect Power, told Semafor. Most are fed up with waiting for the transmission grid and lumbering legacy utilities to catch up with booming demand, and would prefer to build bespoke on-site power plants that draw on some combination of renewables, batteries, and gas. But the independent power companies competing for those contracts mostly lack experience building anything but the power equipment itself, while the infrastructure companies that usually build data centers don’t know how to build power plants.

Kimber sees a payday in bridging that gap in-house, and is busily hiring data center technicians to complement his staff of electric engineers. The company signed a $20 billion deal with Google in December, and Kimber said the first site to emerge from it — under construction now in an undisclosed location — will be operational by next year.

“We’re not just a power company anymore,” he said. “We think we’re creating a whole new class of real estate that we call a digital power asset. It’s not just AI data centers, but a whole host of things that are going to need massive electrification and we’re positioning ourselves to be the real estate provider for that.”

Methane madness

The Trump administration’s move to roll back restrictions on methane emissions by oil and gas producers could undermine its global “energy dominance” agenda.

A sweeping report this week from the International Energy Agency found that energy-related methane emissions — a major driver of global warming — have barely budged in the last decade, in spite of numerous cost-effective mitigation options and a host of commitments from companies and countries to slash them.

Only 5% of global oil and gas productions actually meet a low-methane standard, the report found: That’s going to become a problem for US exporters as key gas markets implement strict emissions standards for imports, said Marcelo Mena, CEO of the Global Methane Hub, a philanthropic group that works with companies and governments on methane. In March, Trump signed a Congressional resolution to block enforcement of a fee on methane pollution.

Meanwhile, methane emissions from coal mining in China also remain extremely high, as do emissions from abandoned fossil fuel sites around the world, a source that is largely neglected by existing regulations and commitments.

As AI continues to evolve at a rapid pace, companies are shifting from experimentation to real-world deployment and practical use within their businesses.

Join Anthropic Co-Founder Jack Clark, World Labs Co-Founder and CEO Dr. Fei-Fei Li, Booking Holdings President and CEO Glenn Fogel, and Singapore Economic Development Board Executive Vice President Ih-Ming Chan for a discussion on the breakthroughs driving AI. Discussions will dive into how global, national, and regional AI ecosystems are shaping the technology’s future, and why building the policy frameworks governing them is more critical than ever for its potential.

May 21, 2025 | San Francisco, CA | Request Invitation

Offshore wind letdown

Potential hit to earnings at the Danish renewable energy firm Ørsted, following the cancellation of a major offshore wind project in the UK. The company said this week it would pull the plug on Hornsea 4 in the North Sea because of rising costs, dealing a sharp blow not only to its own books but also to the UK’s clean energy goals. Offshore wind developers worldwide have struggled for the last few years with spiraling costs and supply chain constraints. Still, the company managed to beat its first-quarter profits from last year, as it completed other projects in its docket.

Tesla’s European headache

Tesla’s revenues dropped still further, especially in Europe, adding to an already calamitous 2025 so far.

The number of vehicles sold by the Elon Musk-led firm fell 81% year-on-year in April in Sweden and 73.8% in the Netherlands, with steep falls in Denmark, France, the UK, and in China, despite overall demand for electric vehicles going up. The US saw a smaller but still noteworthy fall, Inside EVs reported.

Europe is a particular issue since Tesla opened a “gigafactory” in Germany in 2021, capable of building 375,000 cars annually but “likely to be underutilized for some time,” Ars Technica reported. Competition from China is part of the problem, but Musk’s embrace of right-wing politics also appears to be toxic to many EV buyers. Tesla’s US EV rival Rivian, meanwhile, beat Wall Street’s profit expectations for the first quarter but cut its delivery target for the year, citing thousands of dollars per vehicle in additional costs because of tariffs.

New Energy

• A power purchase deal between Google and Shell will be the first time such a deal has been used to extend the life of an offshore wind farm that would otherwise close soon, the companies said.
• Grain Belt Express, the largest power transmission project under development in the US, announced nearly $2 billion in contracts for a pair of construction companies that will help build it.
• The Germany-based energy company RWE said it has completed construction of one gigawatt in new renewables and storage projects in the US in the last six months.

Fossil Fuels

• Negotiations for a massive new gas pipeline from Russia to China will be on the table when Xi Jinping visits Moscow this week.
• Independent US oil producer Marathon Petroleum fell to a loss in the first quarter from nearly $1 billion in profit this time last year, owing to lower margins for its refining operations.
• US federal energy forecasters cut their expectations for crude oil production in the country this year, as a result of lower prices.

Finance

• Shareholder advocacy groups in London grilled the executives of Barclays and Standard Chartered banks about why they aren’t doing more to fund renewable energy.

Tech

• Carbon removal startup Climeworks signed a deal for carbon removal credits with the Japanese shipping firm NYK, the second deal between Climeworks and a shipping company in recent weeks.

Politics & Policy

• Global political cooperation on climate is at its lowest point in recent memory. Don’t expect that trend to last, Bill Gates said.

Minerals & Mining

• As the price of gold soars above $3,000 per ounce, the chief executive of top producer Fortuna Mining says his peers should be cautious about racing to dump more capital into new gold mines.

• China’s share of global copper refining capacity is surging, posing a threat to US and European supply chains, the UN’s trade organization warned.

EVs

• A group of Democrat-led states are suing the Trump administration over its move to withhold funding for EV charging stations.
• EU lawmakers on Thursday gave the green light to a delay for European carmakers to meet 2025 carbon emission reduction targets without facing fines.

Personnel

• Following Warren Buffett’s retirement, his successor at Berkshire Hathaway will have to make some complicated decisions about the firm’s extensive fossil fuel holdings. One his last big bets on oil isn’t panning out very well so far.

Anne-Sophie Corbeau, research scholar at Columbia University’s Center on Global Energy Policy.

MANASSAS, Va. — At a recent Prince William County meeting in Virginia, 71-year-old Elizabeth Martorana described living in a development area for Amazon, Microsoft, and Google data centers: “It’s like living in hell.”

Martorana’s retirement community sits within a few miles of more than 20 proposed data center parks under various stages of development, and is adjacent to a proposed AI campus expected to be the largest in the world once operational, Semafor’s Rachyl Jones wrote.