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Welcome back to Current Climate. The resumption of hostilities between the U.S. and Iran sent oil and gasoline prices back up last week, reversing a month of declines after a tentative ceasefire took hold. Where they’ll go in the near term isn’t clear, but renewed volatility for fossil fuel exports moving through the Strait of Hormuz means the shift to clean energy isn’t going to slow.
In most of the world, the fighting in Iran–coming four years after Russia’s invasion of Ukraine also sent energy prices soaring–has made it clear that relying on imported fossil fuels is just too risky. The U.S., blessed with an abundance of oil and natural gas, hasn’t felt as much economic pain from the war as Europe, Asia and Africa, though insatiable energy demand from AI data centers is accelerating installations of large solar and battery power systems.
In each case, the motivation is economics, not climate-oriented: renewable energy is faster and cheaper to deploy than conventional power sources. And China, by far the world’s top producer of solar panels, wind turbines, batteries and electric vehicles, is reaping the benefits.
In March, the first full month of the Iran war, global exports of Chinese solar panels surged more than 80% from a year earlier, according to energy researcher Ember. And as NPR reports, countries such as Pakistan and the Philippines are buying all they can to bolster domestic energy supplies.
Americans hate higher pump prices, though so far that hasn’t led many to trade in their gas-guzzling SUVs and pickups for electric vehicles, though once again, the story is different in the rest of the world. Global EV sales rose 7% in June to 2 million units, even as they slumped 13% in North America due to the ongoing impact of Trump’s elimination of a $7,500 tax credit last year. Worldwide sales of battery-powered models rose 2% in the first half of 2026, while contracting 20% in North America. And once again, China is the beneficiary.
It exported more than 2 million EVs between January and May, with about half of those exports occurring in April and May, as the Iran war raged, according to NPR, citing analysis by SIA Energy, an oil and gas consultancy.
“Trump has lit a rocket under China’s EV industry,” Dean Baker, a distinguished senior fellow for the Center for Economic Policy and Research, wrote. “Trump’s war helped to boost sales not only by raising the price of gas, but it also created enormous uncertainty about future prices.”
The Big Read
© 2026 Bloomberg Finance LP
California Will Give You $3,500 To Buy A New EV
Sales of electric vehicles are booming worldwide, but have plunged in the U.S. since the Trump administration eliminated a $7,500 federal rebate last year. California, whose residents buy about a third of EVs sold in the country, hopes to rectify that with a new incentive it’s about to launch.
A state budget that went into effect on July 1 includes $135.5 million earmarked to defray some of the cost of battery-powered models. It provides first-time buyers of new electric cars and light trucks priced up to $50,000 with a $3,500 rebate–half covered by those state funds, with automakers providing the other half. The $50,000 price limit, however, is waived for EVs made by California-based companies such as Rivian and Lucid, whose cheapest models currently cost $58,000 and $71,000, respectively. Higher-priced models from Tesla, which left the Golden State for Texas in 2021, don’t qualify. Used EV purchases get a $1,750 discount.
“The premium for a new EV is still about $5,500 higher than for a [gasoline engine] model, so this doesn’t fill the entire gap, but it should help,” said Stephanie Valdez Streaty, director of Industry Insights for Cox Automotive. “The $1,750 for a used EV, given how many units are coming off lease and showing up there, might have a bigger impact.”
Hot Topic
Peak Energy CEO Landon Mossberg on setting up the first U.S. factory for sodium-ion battery packs for energy storage
You’re setting up a $71 million factory in Sacramento. Is it making the cells?
We’re not making battery cells, we’re making the systems. So modules, sub-modules, systems for energy storage systems.
Who’s supplying the cells?
Right now they come from Asia. We’ve got a couple of suppliers there. One of the reasons we’re excited to have GM as an investor and are doing joint cell development with them is because they want to make cells for us domestically. The reason we started on that over a year ago with them was because there had been a bit of a dip in enthusiasm around sodium ion as a battery cell technology. That’s completely reversed now.
Even for the Korean battery makers, which are relatively slow to make some of these decisions. They were slow to LFP and now they’ve thrown a lot of effort behind LFP. So I can understand that it’s hard for them to switch again, but now they’re really ramping into sodium ion. So I think very quickly there will be more options on the market.
Will the packs produced in Sacramento be made exclusively for data centers?
No. The goal of Peak Energy is actually broader than just batteries or storage. We’re really thinking of ourselves as a full-stack energy company. We start with storage. Our first product is that because it’s the most needed asset class on the grid.
We already have dirt-cheap generation with solar and wind in most places where people live. The problem is it’s intermittent. So if you can make storage cheap enough, you can basically unlock twenty-four-seven solar in most places. Then suddenly you’re going to have energy that’s one-third the cost of the cheapest gas we can get. And it happens to be clean and very easy to deploy. You just need land. So that is what we’re going after.
The other thing that I’m even more excited about goes into that longer-term vision, which is pairing generation and renewable technology directly with storage
Your factory is being scaled to produce 4 gigawatt hours of battery packs a year. How many individual units is that?
At the full production rate by the end of next year, we should be able to do three to four a day.
What’s the advantage sodium-ion has over LFP for energy storage?
Pretty much like everything is better. Performance is better. Capex cost is better. Opex cost is way, way better. Safety’s better. Reliability’s better. The only thing that is not better is energy density. On a cell level, battery cell level, we have a 30% energy density penalty versus LFP, which is the incumbent technology. That is getting better very fast. … It’s basically closing that energy density gap very quickly with LFP.
Today, we’re at about a $10 per kilowatt-hour cell-level premium in terms of the cost of the cell. But of course, these sorts of penalties only matter at the system level, and we’re able to overcome both of those penalties at the system level in most applications.
On the energy density side, if you’re a data center customer, you care a lot about uptime and reliability. Because we have no moving parts in the system, because we’re passively cooled, because our state of charge estimation is much easier and more accurate than LFP, you overbuild us way less for a high availability application. So we’re actually more energy dense per application requirement for a data center customer than LFP. That’s a great example of how your cell-level numbers don’t actually matter to your end customer. What matters is what they get. And that’s what we focused on.
What Else We’re Reading
Trump, ending decades of protection, opens wild habitats to drilling and mining (New York Times)
U.S. EPA proposes easing emissions rules for heavy-duty trucks and buses (Reuters)
Electric vehicles are a defense technology (Heatmap)
The plan to make climate science harder to erase (Grist)
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