Alaska, America’s worst state for business, pins hopes on a post-oil boom in carbon offsets
An oil pipeline stretches across the landscape outside Prudhoe Bay in North Slope Borough, Alaska, May 25, 2019.
The Washington Post | The Washington Post | Getty Images
Alaska can be a rugged and unforgiving place, and that’s not just its landscape. Its economy is prone to big booms and wrenching busts. Lately, it has seen more busts.
More than any other state, Alaska is dependent on oil. As much as 85% of the state’s unrestricted general fund revenue comes from oil production, according to state estimates. In some years, it has been well over 90%. But oil production has been in long-term decline in the state, which was once America’s No. 1 producer of crude but has been surpassed by several shale oil boom states, including Texas, New Mexico and North Dakota. Alaska’s crude production in 2022 was roughly equal to that of Oklahoma, and it hit the lowest level since 1976, according to Energy Department data.
This trend helps explain why Alaska‘s economy performed worse than any other state last year, according to the Commerce Department, shrinking by 2.4%. And it explains why the Last Frontier finished dead last in CNBC’s 2023 America’s Top States for Business rankings.
In addition to a last-place finish in the Economy category, Alaska ranks 49th in the Infrastructure, Education, and Access to Capital categories. It finished 48th in Cost of Doing Business. This is the seventh time since 2007 that Alaska has finished at the bottom, and the third time in the last five studies.
Alaska’s carbon turnaround plan for the future
Alaska isn’t giving up on crude. Recent approvals such as the controversial Willow Project have led state officials to forecast an increase in production in the years ahead. But Gov. Mike Dunleavy and the state legislature have a plan that they hope will reverse Alaska’s fortunes once and for all, by making the state less susceptible to gyrations in the oil market.
“Alaska was built on a promise that we would be north of the future. That we would be visionary,” Dunleavy, a Republican, said at a news conference May 23.
Dunleavy was marking the signing of SB 48, legislation that officially puts the state in the carbon business.
“Just like oil, just like gas, just like our timber, this is a commodity that can be monetized now,” he said.
The Tongass National Forest on Prince of Wales Island, Alaska, July 2, 2021.
The Washington Post | The Washington Post | Getty Images
Under the new law, Alaska will be able to sell so-called “carbon offset credits,” capitalizing on the state’s vast public forest lands. Companies that emit carbon will be able to buy the credits, effectively paying the state to preserve and protect its forests, thereby canceling out, or offsetting, those emissions.
What the state doesn’t spend on maintaining its forests, it can keep as revenue.
Alaska Natural Resources Commissioner John Boyle, who is working on the rules to implement the program, said in an interview with CNBC that the market for the new credits could be huge as companies discover the limits of carbon reduction technology.
“Across America, and in the rest of the world, you see a number of companies that have set very aggressive net zero (emission) targets for themselves,” he said. “Ultimately, in order for a lot of these companies to be able to hit the targets that they’ve set for themselves, they’re going to need to look for other options for offsets.”
The emissions offset market is growing
Carbon offset programs are already gaining popularity around the world. The California Air Resources Board operates an extensive offset program that the state says is an essential part of its program to reduce greenhouse gas emissions.
When Dunleavy unveiled the legislation in January, he noted that Alaska’s Native Corporations have generated $370 million in revenue selling offset credits since 2019.
The state has not offered any estimates of how much revenue its program could generate, but Boyle said it could begin making money soon.
“I don’t think it’s unfair to say that the state fully anticipates seeing revenue within a relatively short period of time, likely within the next 12 to 18 months,” Boyle said. “We fully expect to see some new revenues coming in as companies acquire our leases and do other things to prepare themselves to develop carbon offset projects.”
Carbon credits are controversial
Alaska is all in on the plan. The bill passed the state Senate unanimously; only two members of the House voted against it.
But outside Alaska, there is no shortage of skepticism.
“Multiple lines of evidence suggest that Alaska’s forest carbon offsets program could produce carbon credits that don’t represent real climate benefits,” wrote Freya Chay and Grayson Badgley of the climate research group CarbonPlan in a commentary published in May.
They note that while the program promises to protect Alaska’s forests and the climate benefits they provide, it also promises not to reduce timber harvests. The researchers said the credits appear to be structured to “simply reward a landowner for doing what they already planned on doing.”
“Although this could be a win for the State budget, it would be a loss for the climate — and for the credibility of the voluntary carbon market,” they wrote.
Boyle argues that the funding from the offset credits will allow the state to manage its forests more effectively and efficiently. That way, he said, the state will eventually have larger forests — with more trees to capture carbon, and more timber left over to harvest.
“That gives you a margin by which, if you choose, you can do some selective timber harvesting, as long as you maintain a level that is appropriate with the baseline that’s been established,” he said.
Carbon credits are just the beginning of Alaska’s plan to transform its economy. Dunleavy has also proposed creating a “carbon sequestration” program, where the state would capture its carbon emissions — or accept shipments of carbon captured elsewhere — and inject them into underground storage beneath Alaska’s huge expanses of open land.
“There’s a real ability here to move the needle in managing the world’s carbon and storing it for geologically significant periods of time,” Boyle said.
They believe that there is also an ability to diversify Alaska’s economy and make it competitive again, while helping the planet at the same time.
It seems like the writing was already on the wall last week when Volvo moved to make its Luminar-supplied LiDAR system an option – there are now reports that the Swedish car brand is set to ditch LiDAR tech entirely in 2026.
In a recent SEC filing following a missed interest payment on its 2L notes, Luminar confirmed that Volvo’s new ES90 and EX90 flagship models (along with the new Polestar 3) would no longer be offered with LiDAR from Luminar. The move signals a full reversal on the safety tech that had started as standard equipment, then became an option, and is now (according to reports from CarScoops) gone altogether.
In a statement, a Volvo Cars USA spokesperson added the decision was reportedly made, “to limit the company’s supply chain risk exposure, and it is a direct result of Luminar’s failure to meet its contractual obligations to Volvo Cars.”
This is what Luminar had to say about the current, icy state of the two companies’ relationship as of the 31OCT filing:
The Company’s largest customer, Volvo Cars (“Volvo”), has informed us that, beginning in April 2026, Volvo will no longer make our Iris LiDAR standard on its EX90 and ES90 vehicles (although Iris will remain an option). Volvo also informed the Company that it has deferred the decision as to whether to include LiDAR, including Halo (Luminar’s next generation LiDAR under development), in its next generation of vehicles from 2027 to 2029 at the earliest. As a result of these actions, the Company has made a claim against Volvo for significant damages and has suspended further commitments of Iris LiDAR products for Volvo pending resolution of the dispute. The Company is in discussions with Volvo concerning the dispute; however, there can be no assurance that the dispute will be resolved favorably or at all. Furthermore, there can be no guarantee that any claim or litigation against Volvo will be successful or that the Company will be able to recover damages from Volvo.
As a result of the foregoing, the Company is suspending its guidance for the fiscal year ending December 31, 2025.
On November 14, Luminar confirmed that Volvo had terminated its contract altogether, in a blow that could leave Luminar rethinking its long-term future and planning litigation against its biggest ex-customer.
The news follows a host of significant upgrades to the EX90 that include a new, more dependable electronic control module (ECM) and 800V system architecture for faster charging and upgraded ADAS that improves the automatic emergency steering functions and Park Pilot assistant.
Electrek’s Take
You can’t spend years telling everyone you’re miles ahead because you have LiDAR, then ditch LiDAR, and pretend no one is going to call you out on it. They had better hope they don’t up on Mark Rober’s YouTube channel doing a Wile E. Coyote impression (above).
That said, it’ll be interesting to see if ditching the LiDAR has a negative impact there. Or, frankly, whether ditching the LiDAR and its heavy compute loads will actually help mitigate some of the EX90’s niggling software issues. It could go either way, really – and I’m not quite sure which it will be. Let us know which way you think it’ll go in the comments.
SOURCE: Luminar, via SEC filing; featured image by Volvo.
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The new John Deere Z370RS Electric ZTrak zero turn electric riding mower promises all the power and performance Deere’s customers have come to expect from its quiet, maintenance-free electric offerings – but with an all new twist: removable batteries.
The latest residential ZT electric mower from John Deere features a 42″ AccelDeep mower deck for broad, capable cuts through up to 1.25 acres of lawn per charge, which is about what you’d expect from the current generation of battery-powered Deeres – but this is where the new Z370RS Electric ZTrak comes into its own.
Flip the lid behind the comfortably padded yellow seat and you’ll be greeted by six (6!) 56V ARC Lithium batteries from electric outdoor brand EGO. Those removable batteries can be swapped out of the Z370RS for fresh ones in seconds, getting you back to work in less time than it takes to gravity pour a tank of gas.
And, because they’re EGO batteries, they can be used in any 56V-powered EGO-brand tools and minibikes for unprecedented cross-brand interoperability. Tools and minibikes that, it should be noted, can be purchased at John Deere dealers across the country.
The upsell scripts write themselves, kids. And when you start your dialing, tell your prospective customers their new Z370RS Electric ZTrak electric mower lists for $6,499, and if you order now we can bundle it with EGO minibike for the kiddos – just in time for the holidays!
Electrek’s Take
When John Deere launched the first Z370R, Peter Johnson wrote that electrifying lawn equipment needs to be a priority, citing EPA data that showed gas-powered lawnmowers making up five percent of the total air pollution in the US (despite covering far less than 5% of the total miles driven on that gas). “Moreover,” he writes, “it takes about 800 million gallons of gasoline each year (with an additional 17 million gallons spilled) to fuel this equipment.”
It should go without saying, then, that states like California, which are banning small off-road combustion engines, have the right idea.
SOURCE | IMAGES: John Deere.
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![Daimler CEO just dropped some pretty WILD pro-hydrogen claims [update]](https://i0.wp.com/electrek.co/wp-content/uploads/sites/3/2025/09/hydrogen_semi.jpg?resize=1200,628&quality=82&strip=all&ssl=1)
Daimler Truck AG CEO Karin Rådström hopped on LinkedIn today and dropped some absolutely wild pro-hydrogen talking points, using words like “emotional” and “inspiring” while making some pretty heady claims about the viability and economics of hydrogen. The rant is doubly embarrassing for another reason: the company’s hydrogen trucks are more than 100 million miles behind Volvo’s electric semis.
UPDATE 22NOV2025: Daimler just delivered five new hydrogen semis for trials.
While it might be hard to imagine why a company as seemingly smart as Daimler Truck AG continues to invest in hydrogen when study after study has shut down its viability as a transport fuel, it makes sense when you consider that the Kuwait Investment Authority (KIA) holds approximately 5% of Daimler and parent company Mercedes’ shares.
That’s not a trivial stake. Indeed, 5% is enough to make KIA one of the few actors with both the access and the motivation to shape conversations about Daimler’s long-term technology bets, and as a major oil-producing country whose economy would undoubtedly take a hit if oil demand plummeted, any future fuel that’s measured molecules instead of electrons isn’t just a concept for the Kuwaiti economy: it’s a lifeline.
What’s more, Kuwait’s “Oil Strategy 2040” includes plans to nearly double crude oil production and invest billions of dollars in new oil extraction projects and downstream refining facilities, even as the rest of the world rushes to decarbonize.
In that context, the push to make hydrogen seem like an attractive decarbonization option makes more sense. So, instead of giving Daimler’s hydrogen propaganda team yet another platform to try and convince people that hydrogen might make for a viable transport fuel eventually by giving five Mercedes-Benz GenH2 semi trucks to its customers at Hornbach, Reber Logistik, Teva Germany with its brand ratiopharm, Rhenus, and DHL Supply Chain, I’m just going to re-post Daimler CEO Karin Rådström’s comments from Hydrogen Week.
Earlier this month, Daimler Truck AG issued a press release entitled, “Five and a Half Times Around the World: Daimler Truck Fuel Cell Trucks Successfully Complete More Than 225,000 km (~139,000 miles) in Real-World Customer Operations.” Don’t bother looking for it on Electrek, though. I didn’t run it. And I didn’t run it because, frankly, a fleet of over-the-road semi trucks managing to cover a little over half the number of miles that David Blenkle put on his single Ford Mustang Mach-E isn’t particularly impressive.
In the meantime, Daimler competitors like Volvo, Renault, and even tiny Motiv are racking up millions and millions of all-electric miles and MAN Truck CEO Alexander Vlaskamp is saying that it’s impossible for hydrogen to compete with batteries. Heck, even Daimler’s own eActros BEV semi trucks are putting up better numbers than those hydrogen deals.
So, why then is Rådström pouring on the hydrogen love over at LinkedIn?
For some reason – posts about hydrogen always stir up emotions. I think hydrogen (not “instead of” but “in parallel to” electric) plays a role in the decarbonization of heavy duty transport in Europe for three reasons:
- If we would go “electric only” we need to get the electric grid to a level where we can build enough charging stations for the 6 million trucks in Europe. It will take many years and be incredibly expensive. A hydrogen infrastructure in parallel will be less expensive and you don’t need a grid connection to build it, putting 2000 H2 stations in Europe is relatively easy.
- Europe will rely on import of energy, and it could be transported into Europe from North Africa and Middle East as liquid hydrogen. Better to use that directly as fuel than to make electricity out of it.
- Some use cases of our customers are better suited for fuel cells than electric trucks – the fuel cell truck will allow higher payload and longer ranges.
At European Hydrogen Week, I saw firsthand the energy and ambition behind Europe’s net-zero goals. It’s inspiring—but also a wake-up call. We’re not moving fast enough.
What we need:
- Large-scale hydrogen production and transport to Europe
- A robust refueling network that goes beyond AFIR
- And real political support to make it happen – we need smart, efficient regulation that clears the path instead of adding hurdles.
To show what’s possible, we brought our Mercedes-Benz GenH2 to Brussels. From the end of 2026, we’ll deploy a small series of 100 fuel cell trucks to customers.
Let’s build the infrastructure, the momentum, and the partnerships to make zero-emission transport a reality. 🚛 and let’s try to avoid some of the mistakes that we see now while scaling up electric. And let’s stop the debate about “either or”. We need both.
Commenters were quick to point out that Daimler recently received €226M in grants from German federal and state governments to build 100 fuel cell trucks – but, while Daimler for sure doesn’t want to give back the money, it’s also pretty difficult to believe that Rådström’s pro-hydrogen posturing is sincere.
Especially since most of it seems like nonsense.
We’re not doing any of that
At the risk of sounding “emotional,” Rådström’s claims that building a hydrogen infrastructure in parallel will be less expensive than building an electrical infrastructure, and that “you don’t need a grid connection to build it,” are objectively false.
Further, if her claim that “putting 2,000 H2 stations in Europe is relatively easy” isn’t outright laughable, it’s worth noting that Europe had just 265 hydrogen filling stations in operation in 2024 (and only 40% of those, or about 100, were capable of serving HD trucks). At the same time, the IEA reported that there are nearly five million public charging ports already in service on the continent.
Next, the claim that, “Europe will rely on import of energy, and it could be transported into Europe from North Africa and Middle East as liquid hydrogen” (emphasis mine), is similarly dubious – especially when faced with the fact that, in 2023, wind and solar already supplied about 27–30% of EU electricity.
I will agree, however, with one of Rådström’s claims. She notes that, “some use cases of our customers are better suited for fuel cells than electric trucks – the fuel cell truck will allow higher payload and longer ranges.” That’s debatable, but widely accepted as true … for now. Daimler’s own research into lighter, more energy-dense, and lower-cost solid-state battery technology, however, may mean that it won’t be true for long, however.
Unless, of course, Mercedes’ solid-state batteries don’t work (and she would know more about that than I would, as a mere blogger).
Electrek’s Take
As you can imagine, the Karin Rådström post generated quite a few comments at the Electrek watercooler. “Insane to claim that building hydrogen stations would be cheaper than building chargers,” said one fellow writer. “I’m fine with hydrogen for long haul heavy duty, but lying to get us there is idiotic.”
Another comment I liked said, “(Rådström) says that chargers need to be on the grid – you already have a grid, and it’s everywhere!”
At the end of the day, I have to echo the words of one of Mercedes’ storied engineering partners and OEM suppliers, Mahle, whose Chairman, Arnd Franz, who that building out a hydrogen infrastructure won’t be possible without “blue” H made from fossil fuels as recently as last April, and maybe that’s what this is all about: fossil fuel vehicles are where Daimler makes its biggest profits (for now), and muddying the waters and playing up this idea that we’re in some sort of “messy middle” transition makes it just easy enough for a reluctant fleet manager to say, “maybe next time” when it comes to EVs.
We, and the planet, will suffer for such cowardice – but maybe that’s too much malicious intent to ascribe to Ms. Rådström. Maybe this is just a simple “Hanlon’s razor” scenario and there’s nothing much else to read into it.
Let us know what you think of Rådström’s pro-hydrogen comments, and whether or not Daimler’s shareholders should be concerned about the quality of the research behind their CEO’s public posts, in the comments section at the bottom of the page.
SOURCE | IMAGES: Karin Rådström, via LinkedIn.
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