🌎 Trump's climate transition #229

Happy Tuesday!

We’re diving into the news trumping everything else this week — that’s right, the start of the Trump administration and what this all might mean for climate.

In other news, the UK is investing more in nuclear fission and fusion; the first underground injection CCS permit in California; and big climate bond news.

In deals, $7bn for EVs, $2bn in lithium extract across two deals, and $260m in sustainable space vehicle components.

Plus, if you want to hear our takes live, tune into our Line of Sight webinar this Thursday, 23 January, from 11am-12pm ET / 3pm-4pm UK time, for the State of the Climate Capital Stack and Investment Trends, and what’s in store for 2025.

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Inside Biden’s last days, and Trump’s first days

Last week, the Biden administration hit the gas with a flood of climate announcements, racing to lock in its climate and energy priorities before the finish line. Then on Monday, Trump and his team officially took the wheel and wasted no time in issuing a flurry of orders, many steering in the opposite direction. Here’s what’s landing and what’s looming.

What happened

Department of Energy funding: Under Biden, the DOE’s Loan Programs Office, Office of Clean Energy Demonstrations, and Office of Manufacturing and Energy Supply Chains finalized several loan guarantee and grant announcements, including:

An up to $6.6bn loan guarantee to support financing for EV maker Rivian’s second factory in Georgia
An up to $1.7bn loan guarantee for Plug Power to develop up to six facilities for producing low- or zero-carbon hydrogen using the company’s electrolyzers
An up to $996m loan guarantee for Ioneer’s Rhyolite Ridge Lithium-Boron Project in Nevada, a mining and processing facility
An up to $289.7m loan guarantee for Sunwealth to finance the development of commercial solar and storage systems for virtual power plants in 27 states
A $225m grant for Standard Lithium and Equinor’s construction of the South West Arkansas project, a high-grade lithium brine initiative using Direct Lithium Extraction technology

Tax credit guidance: Not to mention, in the past few weeks, the IRS released final guidance on tax credits for hydrogen, clean fuels, and clean electricity.

New department heads: Last week, the Senate held confirmation hearings for the Trump administration’s new picks to head key climate federal agencies:

Chris Wright, President Trump’s nominee for new DOE head, pledged to prioritize domestic energy production, including fossil fuels, liquefied natural gas, and nuclear power, while acknowledging the DOE’s role in accelerating new energy technologies to combat climate change, but still reaffirming his commitment to President Trump’s pro-drilling agenda. He also declined to immediately halt outstanding LPO loans.
Doug Burgum, Trump’s nominee for Interior Secretary, emphasized achieving U.S. "energy dominance" during his Senate confirmation hearing, framing it as critical for national security. He advocated for expanded fossil fuel extraction on public lands and waters, viewing these resources as part of the nation’s "balance sheet," while also promoting baseload energy sources like coal and natural gas to power data centers and compete in the AI arms race against China.
Lee Zeldin, nominee for EPA Administrator, testified before the Senate and revealed few details about plans to change or roll back environmental regulations, beyond pushing for fiscal responsibility. He recognized climate change and the problem of PFAS pollution.

Executive orders: Both Biden and Trump issued climate-related executive orders:

Biden issued a new executive order directing the Department of Defense and DOE to lease federal sites for private sector use to build AI infrastructure at scale
Trump, after calling for ending the “Green New Deal” in his inauguration speech, fired off a blast of executive orders, declaring an "energy emergency" in the US and the promise to "drill baby, drill":
- Banning offshore wind lease sales in federal waters, plus pausing approvals, permits and loans for both onshore and offshore wind projects
- Declaring a national “energy emergency” to bolster domestic energy production, transportation, refining, and generation, directing more drilling on federal lands and expedited permits
- Repealing EPA tailpipe emissions rules and restarting LNG terminal approvals
- Rolling back Biden’s environmental justice initiatives, protections for Alaskan coastal drilling (and other areas), appliance energy efficiency standards, federal procurement for EVs, clean power, low-carbon buildings, and more
- Seeking to pause funds from the IRA and withdraw from the Paris Agreement

Why it matters

The US federal government is one of the biggest investors in climate tech via its funding and tax credit programs, among others, which were significantly boosted by the 2022 Inflation Reduction Act (IRA). While the IRA provided significant resources for both emerging and mature techs, the future under a Trump administration remains uncertain, as Trump’s campaign promises included repealing the IRA, hinting at targeting programs like the LPO (Project 2025, the conservative policy blueprint, explicitly called for eliminating the LPO). However, Trump held off on immediately issuing new tariffs which could raise project costs and impact clean energy supply chains.

Still, this introduces new ambiguity for ongoing and conditional commitments, despite assurances from Biden’s DOE officials that finalized awards are legally binding and difficult to reverse. The lack of clarity on Trump’s plans for energy and climate funding introduces risks for developers, funders, and founders reliant on federal support, especially for conditional commitments still in the pipeline (such as a $15bn for California utility PG&E for hydropower, LDES, and more; $22.4bn in loans for eight US utilities across 12 states for clean energy and infrastructure investments; $4.8bn for a Midwestern transmission line project; and $1.8bn for energy storage startup Hydrostor’s Willow Rock Energy Storage Center).

Meanwhile, the newly chosen department heads (who can be sworn in after approval from the Senate now once the new president takes office) and Trump’s executive orders also have the potential to shift the energy landscape of the US — in favor of fossil fuels — at a key moment when energy demand is rising, and as the planet officially surpassed the critical 1.5-degree threshold for the first time last year.

Key takeaways

Uncertainty for clean project developers. Project developers and investors are building long-term assets where (hopefully) the economics pencil out, but need clarity on (high) upfront costs. This confusion about public funding and incentives could scare off hesitant investors, or lead to project delays for developers, especially given the legal challenges that deregulation is likely to face.
But not all sectors are affected equally. Trump is essentially pushing for more “baseload” power, so strong on gas and coal, as well as nuclear, geothermal, and hydropower. Factors like his moves to streamline permitting could actually end up spurring new nuclear projects to meet this demand. However, for variable energy sources, this could hurt. Rollbacks on wind farm leasing and Biden’s EV and clean power initiatives would inevitably slow renewables growth.
Trump’s impact on energy production is still reliant on broader global trends. Despite Trump’s “drill, baby, drill” rhetoric, the US is already producing record-high levels of oil and gas, and the economic incentive for further drilling is limited, particularly as shale extraction is costlier than traditional oil and gas. Additionally, gas prices today are only a small factor in the lifetime cost of new power infrastructure, such as 30-year gas plants. While boosting supply may exert downward pressure on US gas prices, the expansion of LNG export terminals could offset this by increasing global demand. Ultimately, Trump’s policies pull levers in conflicting directions, creating uncertainty about their net impact. The anticipated growth in US gas plants appears driven more by technological trends, particularly data center energy demand, than by fuel prices or policy changes alone.

Deals of the Week (1/13-1/19)

Late-Stage / Growth

🏭 STOKE Space, a Renton, WA-based sustainable space vehicle components developer, raised $260m in Series C funding from MaC Venture Capital.

🌳 Colossal Biosciences, an Austin, TX-based de-extinction technology developer, raised $200m in Series C funding from Animal Capital, At One Ventures, Bold Capital Partners, Brandon Fugal, Breyer Capital, and other investors.

🚚 Harbinger, a Gardena, CA-based medium-duty EV trucks manufacturer, raised $100m in Series B funding from Capricorn Investment Group, Leitmotif, ArcTern Ventures, Coca Cola, Ironspring Ventures, and other investors.

⚡ Amogy, a Brooklyn, NY-based ammonia-based energy developer, raised $56m in Growth funding from Aramco Ventures, SV Investment Corp, AFW Partners, AP Ventures, BHP Ventures, and other investors.

⚡ H2SITE, a Santiago de Compostela, Spain-based hydrogen membrane separation reactor developer, raised $37m in Series B funding from Hy24, Suma Capital, Enagás, Exergon, and MassMutual Ventures.

💨 BeZero Carbon, a London, England-based carbon ratings and risk analytics platform, raised $32m in Series C funding from GenZero, EDF Pulse Ventures, Hitachi Ventures, Illuminate Financial, Intercontinental Exchange, and other investors.

🛵 Zypp Electric, a Gurgaon, India-based last-mile delivery EV rental service, raised $7m in Series C funding from ENEOS, 9Unicorns, Ajay Kumar Aggarwal, Anthill Ventures, Eiman Abdullah, and other investors.

✈️ Infinium, a Sacramento, CA-based electrofuels developer, raised an undisclosed amount in Series C funding from Brookfield Asset Management, AP Ventures, Amazon Climate Pledge Fund, Development Bank of Japan, Japan Hydrogen Fund, and other investors.

Early-Stage

⚒️ ElectraLith, a Melbourne, Australia-based direct lithium extraction service provider, raised $28m in Series A funding from Main Sequence Ventures, Breakthrough Victoria, Chevron Technology Ventures, Fathom, Hostplus, and other investors.

🔋 Moment Energy, a Coquitlam, Canada-based EV battery repurposing service, raised $15m in Series A funding from Amazon Climate Pledge Fund, Voyager Ventures, Climate Capital, Fika Ventures, In-Q-Tel, and other investors.

💨 Origen, a London, England-based direct air capture with mineralization technology developer, raised $13m in Series A funding from Barclays, Elemental Impact, Exascale Fund, Hatch, and Shell Ventures.

✈️ Metafuels, a Zürich, Switzerland-based E-SAF from methanol producer, raised $9m from Celsius Industries, Contrarian Ventures, Energy Impact Partners, Fortescue, RockCreek, and other investors.

🔋 Circunomics, a Mainz, Germany-based circular battery platform, raised $9m in Series A funding from Schaeffler Group, Orlen, and RISE.

🌬 Clobotics Wind Services, an Esbjerg, Denmark-based wind turbine inspection services, raised $5m in Series A funding from KTB Network, Capital Development Investment Fund, and GGV Capital.

🌱 GreenStitch, a London, England-based sustainability solutions for textiles service provider, raised $1m in Seed funding from Equirus Capital, Amit Kumar Agarwal, Anshuman Bapna, IvyCap Ventures, Pankaj Vermani, and other investors.

Other

🚗 Rivian, an Irvine, CA-based Electric Vehicle manufacturer, raised $7bn in Debt funding from US Department of Energy’s (DOE) Loan Programs Office (LPO).

⚒️ EnergySource Minerals, a San Diego, CA-based lithium extraction service, raised $2bn in Loan funding from US Department of Energy’s (DOE) Loan Programs Office (LPO).

⚡ Origis Energy, a Miami, FL-based renewable energy project developer, raised $1bn in PE Expansion funding from Antin Infrastructure Partners and Brookfield Asset Management.

🥩 Formo, a Berlin, Germany-based alternative cheese manufacturer, raised $36m in Debt funding from European Investment Bank (EIB).

🏠 Ecozen, a Pune, India-based sustainable cold chain technology provider, raised $23m in Debt funding from Maanaveeya, Northern Arc Capital, Private Finance, and responsAbility Investments.

🚗 Euler Motors, a New Delhi, India-based EV manufacturer, raised $20m in Debt funding from responsAbility Investments.

🌾 ORCAL, a Junction City, OR-based crop protection and sustainable farming service provider, raised an undisclosed amount in PE Buyout funding from Baden Capital.

Exits

⚡ Greyrock Technology, a Sacramento, CA-based gas conversion solutions provider, was acquired by Infinium for an undisclosed amount.

New Funds

Ridgewood Infrastructure, a New York, NY-based investment firm, raised $1.2bn for its second fund, focusing on essential infrastructure, including water, energy, transportation, and utilities.

Can’t get enough deals? See full listings and deal analytics on Sightline Climate.

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In the News

In nuclear news, the UK government is exploring the use of nuclear power to supply clean and reliable energy to new “AI Growth Zones”, addressing the substantial energy demands of data centers. In Estonia, Fermi Energia has initiated the site selection process for a 600MW small modular reactor, marking a significant step toward diversifying the nation's energy mix. Meanwhile, the Czech Republic unveiled plans to increase its nuclear energy share to 68% by 2040, up from the current 40%, as part of its strategy to phase out coal by 2033, as the energy source continues to be a pivotal player in achieving energy security and meeting climate goals.

Meanwhile, the UK government pledged £410m to investments in fusion, aiming to convert a coal power station into a prototype fusion plant by 2040. This investment pledge reflects how the UK is getting into the fusion race (with the US and China), as momentum for nuclear and the demand for clean firm power continue.

The EPA has issued its first Underground Injection Control (UIC) Class VI permits in California, allowing Carbon TerraVault to build four CO2 injection wells in a SoCal oilfield. Given the difficulty of obtaining this permit, especially after concerns around CCS injection with the leak in Illinois, this is a big milestone for advancing carbon capture and storage in the US.

In recent news in bond markets, the Climate Investment Funds secured $500m for its Clean Technology Fund bond to support low-carbon technology in developing countries. Meanwhile, Brookfield Asset Management raised $5bn for its battery manufacturing unit, allowing a $4.5bn dividend payout. Both moves demonstrate strong investor confidence in the energy sector over the past six months and the growing role of bond markets in financing clean energy transitions.

An £800m deal by Copenhagen Infrastructure Partners will fund the development of two of Europe’s largest battery storage sites in Scotland. The new projects, Coalburn 2 and Devilla in Fife, each have a capacity of 500 MW, bringing CIP's total UK BESS portfolio to 1.5GW. The new sites will enhance energy security and support the UK’s clean energy transition by 2030, marking a significant step in advancing large-scale battery storage in the region.

South Korea is investing $680m in green marine fuel infrastructure by 2030, beginning with Ulsan Port, split for bunkering vessels and fuel storage facilities for LNG, methanol, and ammonia for two projects. With the goal of spurring methanol demand but also increasing LNG delivery capacity, it expands the use case for maritime clean fuels but also LNG as part of energy security strategies in East Asian nations.

SSAB has pulled out of negotiations for a $500m US federal award aimed at supporting a green steel project in Mississippi, from a project producing iron using green hydrogen, aligned with the DOE’s decarbonization goals, as uncertainty pervades around the US’ industrial decarbonization projects.

Pop-up

McKinsey takes the temperature of climate tech scalability in the UK.

Say hi: The DOE’s new GREET models are out.

Sustainable aviation fuel is taking off in London’s Heathrow Airport. Destination: 3% by 2025.

Big names in energy tech get together to amp up thermal battery advocacy.

Playing with fire: Climate change could cut the global GDP by 50% between 2070 and 2090.

Google to purchase 100,000 tons of carbon credits from a startup making gardening charcoal from invasive plants.

This tanker is using wind-powered sails to breeze through lowering emissions.

Meanwhile, nuclear-powered ships are also making waves.

This interactive tool shows how NYC Congestion Pricing is unjamming traffic.

SCOTUS declined to hear from oil and gas companies trying to block climate change lawsuits — but a NYC lawsuit against Exxon, BP, and Shell over climate change ran out of gas and was still dismissed.

Opportunities & Events

📅 Bankability in Climate Tech: RSVP to attend the Bankability in Climate Tech webinar on January 21st to explore how investors assess risk and return.

📅 Line of Sight Webinar: Join our team, Kim Zou, Mark Taylor, Julia Attwood, and Sophie Purdom, on January 23rd for this interactive session where we’ll go over insights from both our Capital Stack and Investment Trends reports, as well as what’s to come in 2025!

📅 Women in Climate Meetup: RSVP to attend the monthly Women in Climate Meetup on January 29th to connect with others working in or aspiring to work in climate and the energy transition.

💡 AI Climate Accelerator: Apply to the AI Climate Accelerator by February 3rd to access non-dilutive grants, mentorship, and a 12-week program designed for underserved early-stage founders.

💡 Climatebase Fellowship: Apply to participate in the 7th cohort of the Climatebase Fellowship by February 14th and accelerate your climate career.

💡 CalTech Rocket Fund:Apply to the CalTech Rocket Fund by March 3rd for a chance to secure $25,000–$100,000 in non-equity grants for your cleantech or sustainability startup.

💡 InnovateMass: Apply to the InnovateMass program by March 17th to access up to $350,000 and support for your startup, particularly GridTech ventures, in overcoming the commercialization valley of death.

📅 SET Tech Festival 2025: Register to attend the SET Tech Festival in Berlin on March 18th to learn from and network with leading energy experts, climate tech investors, and pioneering startups.

💡 NASA Sustainable Business Model Challenge: Apply to the NASA Sustainable Business Model Challenge by June 13th for a chance to win up to $10,000 using NASA’s Earth science data to tackle climate challenges.