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President and Chief Executive Officer (CEO) of the AES Corporation Andres Gluski speaks during an interview with Reuters in Santiago, Chile June 4, 2019. Picture taken June 4, 2019. 

Rodrigo Garrido | Reuters

The euphoria over nuclear energy as a power source for data centers is “overblown,” the CEO of a major power provider for large tech companies told CNBC in an interview Monday.

AES Corporation CEO Andrés Gluski said renewable energy is the future, though natural gas will also play a role as a transition fuel. Nuclear power, on the other hand, faces challenges in meeting the growing power demand from data centers, Gluski said.

AES is a major power provider for large tech companies building out data centers, with more than 40% of its 12.7 gigawatt backlog coming from customers including Amazon, Microsoft and Google, according to its most recent earnings presentation to investors.

Some Wall Street analysts have predicted a nuclear renaissance as power demand increases thanks to artificial intelligence, data centers, re-industrialization and the electrification of the vehicle fleet. Nuclear provides reliable, carbon-free energy, though new projects have long lead times and are expensive.

Gluski said the “euphoria” over nuclear power is a “little overblown.” There is only so much existing nuclear energy that merchant power providers can re-contract to sites such as data centers, the CEO said.

“The question is, going forward, what’s the price of new nuclear,” Gluski said, adding that only one new nuclear plant has been built in the U.S. in decades and it came in far above budget.

‘The future is going to be renewable’

The second of two new nuclear reactors at Vogtle Plant in Georgia came online in April, but the project was seven years behind schedule and cost double the original projections, according to the Energy Information Administration. The reactors, operated by Georgia Power, are the first newly-constructed nuclear units built in the U.S. in more than 30 years, according to the Department of Energy.

“The Street got ahead of it saying you’re not going to build renewables, it’s all going be nuclear,” Gluski said. “It’s going to be natural gas and renewables, but the bulk of it’s going to be renewables,” the CEO said.

AES current gross power generation is 54% renewables, 27% natural gas, and 17% coal. Renewables represent 89% of the company’s gross power generation under construction while gas makes up the remaining 11%.

Gluski pointed to the recent agreement between Microsoft and Brookfield Asset Management for 10.5 gigawatts of renewable energy between 2026 and 2030 as a sign of the future. Microsoft and Brookfield described the agreement as the largest renewable purchase ever between two corporate partners.

“It tells you that’s where most of the energy is going to be coming from,” Gluski said. “They are cheaper, they are clean and quite frankly easier to site, so the future is going to be renewable energy.”

Natural gas vs. renewables

The natural gas industry views data centers as major source of demand growth, arguing that renewables will need a backup power source when they are not generating enough power due to sun or wind conditions.

“I do agree that we’re going to need natural gas to shore up, if you want, renewables until batteries become ubiquitous and cheap enough to make up for that,” Gluski said.

Goldman Sachs estimates that power demand from data centers will more than double to 8% of total U.S. electricity consumption by 2030, according to an April report. The investment bank sees natural gas supplying 60% of the demand growth, and renewables 40%.

But battery prices are coming down, the CEO said, and there is as much battery storage waiting for connection to the grid as solar power. There are some hours during the day in California where storage represents the biggest source of energy being dispatched, Gluski said.

“You can do it 100% with renewables, you just need a whole lot more renewables,” he said.

Solar, storage and wind represented about 95% of the power capacity in line waiting for connection to the grid at the end of 2023, while gas was just 3% and a grab bag made up the rest, according to Lawrence Berkeley National Laboratory. Renewables and storage in line for connection is nearly twice the installed capacity of the U.S. power plant fleet.

AES has already signed long-term contracts with data centers to provide them hourly matched renewable energy 24/7, Gluski said. “We’ve done that already for two years. So we can do that today,” he said.

AES signed an agreement with Google in 2021 to power its Virginia data center campus with 90% carbon-free energy on an hourly basis using a combination of wind, solar, hydro and battery storage resources.

The power company recently signed an agreement with Amazon for an additional gigawatt of solar and storage at a site in Kern County, California, bringing the project to a total of two gigawatts in a 15-year contract that is expected to come online in 2025 to 2026. AES has described the agreement as the largest solar and storage project in the U.S.

All told, the power company has signed agreements to provide Amazon with 3.1 gigawatts of power, Microsoft with 1.7 gigawatts, and Google with 800 megawatts, according to its first quarter earnings presentation.

“All of them want to be part of an energy transition,” Gluski said. “I don’t see anybody saying build me gas and coal plants to power my data centers, unless it’s a temporary situation, give me power from your gas plant until the renewables are available.”

AES stock is up 26% over the past three months and 6% year to date. Some 67% of Wall Street analysts rate AES the equivalent of a buy, 25% have a hold on the company’s stock and 8% rate it the equivalent of a sell.

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Solar and wind industry faces up to $7 billion tax hike under Trump’s big bill, trade group says

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Solar and wind industry faces up to  billion tax hike under Trump's big bill, trade group says

Witthaya Prasongsin | Moment | Getty Images

Senate Republicans are threatening to hike taxes on clean energy projects and abruptly phase out credits that have supported the industry’s expansion in the latest version of President Donald Trump‘s big spending bill.

The measures, if enacted, would jeopardize hundreds of thousands of construction jobs, hurt the electric grid, and potentially raise electricity prices for consumers, trade groups warn.

The Senate GOP released a draft of the massive domestic spending bill over the weekend that imposes a new tax on renewable energy projects if they source components from foreign entities of concern, which basically means China. The bill also phases out the two most important tax credits for wind and solar power projects that enter service after 2027.

Republicans are racing to pass Trump’s domestic spending legislation by a self-imposed Friday deadline. The Senate is voting Monday on amendments to the latest version of the bill.

The tax on wind and solar projects surprised the renewable energy industry and feels punitive, said John Hensley, senior vice president for market analysis at the American Clean Power Association. It would increase the industry’s burden by an estimated $4 billion to $7 billion, he said.

“At the end of the day, it’s a new tax in a package that is designed to reduce the tax burden of companies across the American economy,” Hensley said. The tax hits any wind and solar project that enters service after 2027 and exceeds certain thresholds for how many components are sourced from China.

This combined with the abrupt elimination of the investment tax credit and electricity production tax credit after 2027 threatens to eliminate 300 gigawatts of wind and solar projects over the next 10 years, which is equivalent to about $450 billion worth of infrastructure investment, Hensley said.

“It is going to take a huge chunk of the development pipeline and either eliminate it completely or certainly push it down the road,” Hensley said. This will increase electricity prices for consumers and potentially strain the electric grid, he said.

The construction industry has warned that nearly 2 million jobs in the building trades are at risk if the energy tax credits are terminated and other measures in budget bill are implemented. Those credits have supported a boom in clean power installations and clean technology manufacturing.

“If enacted, this stands to be the biggest job-killing bill in the history of this country,” said Sean McGarvey, president of North America’s Building Trades Unions, in a statement. “Simply put, it is the equivalent of terminating more than 1,000 Keystone XL pipeline projects.”

The Senate legislation is moving toward a “worst case outcome for solar and wind,” Morgan Stanley analyst Andrew Percoco told clients in a Sunday note.

Shares of NextEra Energy, the largest renewable developer in the U.S., fell 2%. Solar stocks Array Technologies fell 8%, Enphase lost nearly 2% and Nextracker tumbled 5%.

Trump’s former advisor Elon Musk slammed the Senate legislation over the weekend.

“The latest Senate draft bill will destroy millions of jobs in America and cause immense strategic harm to our country,” The Tesla CEO posted on X. “Utterly insane and destructive. It gives handouts to industries of the past while severely damaging industries of the future.”

Catch up on the latest energy news from CNBC Pro:

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Nissan is in crisis mode as job cuts begin and suppliers are caught in the crosshairs

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Nissan is in crisis mode as job cuts begin and suppliers are caught in the crosshairs

Is Nissan raising the red flag? Nissan is cutting about 15% of its workforce and is now asking suppliers for more time to make payments.

Nissan starts job cuts, asks supplier to delay payments

As part of its recovery plan, Nissan announced in May that it plans to cut 20,000 jobs, or around 15% of its global workforce. It’s also closing several factories to free up cash and reduce costs.

Nissan said it will begin talks with employees at its Sunderland plant in the UK this week about voluntary retirement opportunities. The company is aiming to lay off around 250 workers.

The Sunderland plant is the largest employer in the city with around 6,000 workers and is critical piece to Nissan’s comeback. Nissan will build its next-gen electric vehicles at the facility, including the new LEAF, Juke, and Qashqai.

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According to several emails and company documents (via Reuters), Nissan is also working with its suppliers to for more time to make payments.

Nissan-delays-supplier-payments
The new Nissan LEAF (Source: Nissan)

“They could choose to be paid immediately or opt for a later payment,” Nissan said. The company explained in a statement to Reuters that it had incentivized some of its suppliers in Europe and the UK to accept more flexible payment terms, at no extra cost.

The emails show that the move would free up cash for the first quarter (April to June), similar to its request before the end of the financial year.

Nissan-delays-supplier-payments
Nissan N7 electric sedan (Source: Dongfeng Nissan)

One employee said in an email to co-workers that Nissan was asking suppliers “again” to delay payments. The emails, viewed by Reuters, were exchanged between Nissan workers in Europe and the United Kingdom.

Nissan is taking immediate action as part of its recovery plan, aiming to turn things around, the company said in a statement.

Nissan-Micra-EV
The new Nissan Micra EV (Source: Nissan)

“While we are taking these actions, we aim for sufficient liquidity to weather the costs of the turnaround actions and redeem bond maturities,” the company said.

Nissan didn’t comment on the internal discussions, but the emails did reveal it gave suppliers two options. They could either delay payments at a higher interest rate, or HSBC would make the payment, and Nissan would repay the bank with interest.

Nissan-delays-supplier-payments
Nissan’s upcoming lineup for the US, including the new LEAF EV and “Adventure Focused” SUV (Source: Nissan)

The company had 2.2 trillion yen ($15.2 billion) in cash and equivalents at the end of March, but it has around 700 billion yen ($4.9 billion) in debt that’s due later this year.

As part of Re:Nissan, the Japanese automaker’s recovery plan, Nissan looks to cut costs by 250 billion yen. By fiscal year 2026, it plans to return to profitability.

Electrek’s Take

With an aging vehicle lineup and a wave of new low-cost rivals from China, like BYD, Nissan is quickly falling behind.

Nissan is launching several new electric and hybrid vehicles over the next few years, including the next-gen LEAF, which is expected to help boost sales.

In China, the world’s largest EV market, Nissan’s first dedicated electric sedan, the N7, is off to a hot start with over 20,000 orders in 50 days.

The N7 will play a role in Nissan’s recovery efforts as it plans to export it to overseas markets. It will be one of nine new energy vehicles, including EVs and PHEVs, that Nissan plans to launch in China.

Can Nissan turn things around? Or will it continue falling behind the pack? Let us know your thoughts in the comments below.

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Elon Musk said to bet on Tesla delivering Robotaxi in June, yet those who did just lost big

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Elon Musk said to bet on Tesla delivering Robotaxi in June, yet those who did just lost big

Elon Musk said just a few weeks ago that betting on Tesla delivering its promised Robotaxi in June is a “money-making opportunity,” and yet, those who listened to him just lost big.

A fan of Musk lost $50,000 betting on Tesla Robotaxi.

With the rise in prediction markets, you can bet on virtually everything these days.

Sites like Polymarket have about a dozen prediction markets related to Tesla, where anyone can bet on events such as Tesla delivering its robotaxi service.

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There have been a couple of specific markets about that, and Musk directly commented on one titled “Will Tesla launch a driverless Robotaxi service before July?:

Less than two weeks ago, the market gave Tesla only a 14% chance of launching the service, and Musk called it a “money-making opportunity.”

At the time, less than $500,000 was traded on this market, but Musk made it way more popular.

Now, over $7 million has been traded on this market, and while Tesla claims to have launched its Robotaxi service on June 22nd, the market currently gives Tesla less than 1% chance today, with less than a day left in June.

Each prediction market has clear “resolution” rules and Musk evidently didn’t read them before suggesting there was money to be made betting “yes”:

This market will resolve to “Yes” if Tesla publicly launches a fully driverless taxi service by June 30, 11:59 PM ET. Otherwise, it will resolve to “No.”

Any service that allows a member of the general public to summon and ride in a Tesla vehicle operating without any human—onboard or remote—actively controlling the vehicle will count. A human may be present in the vehicle or monitoring remotely for emergency intervention, but they must not be physically positioned to take control (for example, no safety driver in the driver’s seat) and must not actively steer, brake, accelerate, or otherwise drive the car under normal operation.

A program that is restricted to Tesla employees, invite-only testers, closed-beta participants, factory self-delivery features, or the mere release of Full Self-Driving software for private owner-drivers will not qualify. Regulatory permits or approvals, press demonstrations, and prototype unveilings without live public ridership likewise will not count toward resolution.

This market’s resolution source will be a consensus of credible reporting.

There are a few things in the resolution that disqualify what Tesla launched on June 22nd. First off, there’s a human inside the vehicle ready to take control with their finger on a kill switch. We have already seen interventions from the in-car Tesla supervisor, who are still very much necessary.

Secondly, the resolution requires a launch that is not restricted to an invite-only basis, which is currently the case.

The level of remote operations could also prove challenging to confirm, and it is part of the resolution.

Electrek found someone who lost $50,000 following Musk’s “money-making opportunity”:

Someone else has lost $28,000 and is now betting another $27,000 that Tesla will achieve this by the end of July.

Currently, Polymarket‘s odds only put a 21% chance of Tesla delivering on the service based on the previously mentioned resolution before August:

There’s another market predicting if “Tesla launches unsupervised full self-driving (FSD) by the end of 2025” that has arguably an even more restrictive resolution, and it currently gives it a 59% chance of happening:

With Polymarket, users are not really “betting” on an outcome, but they are trying to beat the current odds by buying shares in “yes” or “no”, which they can sell to other users before the end of the timeline.

Electrek’s Take

It’s quite amusing that Musk was so confident people would believe in his Robotaxi that he didn’t bother to investigate what other people think an actual robotaxi service would entail, like in the Polymarket resolution.

Historically speaking, you are way better off betting against whatever timeline Musk claims about self-driving. He has been consistently wrong about it for a decade now.

Polymarket even has a market about Tesla launching unsupervised self-driving in California this year. I threw some money in that one because California has much stricter regulations when it comes to self-driving, and it requires a lot of testing before being deployed, as described in the resolution.

I doubt Tesla can go through that this year, but it’s not impossible.

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