A blue wave may already be cresting. Democrats have flipped 28 Republican-held seats in state legislatures across the country over the past 14 months, a sign that the GOP is indeed at risk of losing control of the House, and maybe even the Senate, in the midterms. Democratic wins have come even in deep red states, including Texas, Arkansas and Mississippi, and often by margins that make Republican leaders uneasy. “I’m ringing the alarm bell,” said Brendan Steinhauser, a Texas GOP consultant who has run campaigns for Republicans in the state, including Sen. John Cornyn and Rep. Dan Crenshaw. The results of these state-level elections reflect the immediate concerns of the electorate, provide a launching pad for the next generation of national leaders and could influence the future makeup of Congress through redistricting. They may also give both Republicans and Democrats a preview of the midterm battles to come. For Republicans, the results are a sign that they must do more to motivate low-propensity voters who helped carry President Donald Trump back to the White House, said a senior GOP campaign operative, who was granted anonymity because he didn’t have permission from the party to speak freely about the losses. “We’re the party of low propensity voters now,” said the operative. “How do we turn out these Republican voters in a midterm election?” One of the first signs that Democrats were building momentum came in August, when an Iowa Senate district swung more than 20 points to elect Democrat Catelin Drey. It was the second seat Democrats flipped in the state last year, and the moment that broke the Republican Senate supermajority in the General Assembly. Then in November, Democrats did it again: They flipped three of the six Republican-held districts in a Mississippi special election, again breaking a GOP Senate supermajority. “You are seeing people just vote for change,” said Brian Robinson, a GOP consultant in Georgia, where Republicans lost a seat in December. Robinson, an outside adviser for the state House GOP caucus, says Republicans are blamed for high prices because they’re in charge. “If it’s any one thing, it is [the] cost of living.” Robinson said, arguing that Trump will do something to reduce prices before the midterms. In recent weeks, the president has indeed taken steps, including by touting a pledge from tech companies to reduce energy costs associated with data centers and releasing 172 million barrels of oil from the Strategic Petroleum Reserve. The Iran war, which has sent global oil prices skyrocketing, complicates that effort. After Democrats flipped 13 Virginia seats and five New Jersey seats in November, the Democratic Legislative Campaign Committee went back to reassess state races around the country. They expanded their 2026 target map to 42 chambers and invested $50 million in changing the makeup of state legislatures — the widest map and largest single-year budget DLCC has ever approved. Legislatures in Arizona and New Hampshire are now on the “flip” list, and the DLCC hopes to break or prevent GOP supermajorities in red states across the South and Midwest. Their success could give Democrats more state power over judicial nominees, protect the veto power of Democratic governors in states with GOP-led legislatures and hand Democrats greater influence over redistricting. Republicans, meanwhile, are waiting for the funding to hit. As of January, the RNC has just over $100 million and Trump’s MAGA Inc. PAC has $300 million. State Republicans say when that cash flows into midterm races, it will enable them to get low-propensity voters to vote. Turnout was a major point of discussion at an RNC conference call that Wisconsin GOP Chair Brian Schimming attended Tuesday, and he says Republicans will dedicate a lot of resources to motivate voters in November. “We’ve met with the White House more than once, and they keep track of the target states pretty closely,” said Schimming, adding he also expects Trump and Vice President JD Vance to stump in key Wisconsin congressional districts closer to the election. “They are big base motivators.” In the meantime, Democrats keep flipping state seats. The latest came Tuesday night, when Bobbi Boudman beat Republican Rep. Dale Fincher in a New Hampshire Senate seat that Trump won by 9 points. On March 24, voters will decide in a special election who represents the Florida state House seat that includes Mar-a-Lago. Democrat Emily Gregory, a small business owner who is running against Republican Jon Maples, a businessman, saw her total campaign earnings jump by nearly 75 percent between Jan. 9 and Feb. 12. In November, a national PAC connected Gregory with Drey, who flipped the Iowa seat in August. Drey advised Gregory to find the affordability issue that matters most to her district — the way energy costs resonate in New Jersey and property insurance does in Florida. “In this moment, we have all of the issues on our side. We have all of the momentum on our side,” Gregory recalled Drey telling her. “It’s just up to you as a candidate to get in front of every single voter you can and communicate that message.”

BRITAIN’S LABOUR PARTY STARES INTO THE ABYSS IN ITS WELSH HEARTLAND In the old coalfields of south Wales, Britain’s center-left establishment faces being crushed by a nationalist left and populist right. POLITICO went to find out why. By DAN BLOOM and SASCHA O’SULLIVAN in Newport, South Wales Photo-Illustration by Natália Delgado/POLITICO Eluned Morgan, the Welsh first minister, stood in a sunbeam at Newport’s Victorian market and declared: “Wales is ready for a new chapter.” Many voters agree. The problem for Morgan is: few think she’ll be the one to write it. This nation of 3 million people, with its coalfields, docks, mountains and farms, is the deepest heartland of Morgan’s center-left Labour Party. Labour has topped every U.K. general election here for 104 years and presided over the Welsh parliament, the Senedd, since establishing it 27 years ago. Yet Senedd elections on May 7 threaten not only to end this world-record winning streak, but leave Welsh Labour fighting for a reason to exist. One YouGov poll in January put the party joint-fourth with the Conservatives on 10 percent, behind Welsh nationalists Plaid Cymru on 37 percent, Nigel Farage’s populist Reform UK on 23 percent and the Greens on 13 percent. Other polls are less dramatic (one last week had Reform and Plaid equal, and Labour a closer third), but the mood remains stark.  The most common projection for the 96-seat Senedd is a Plaid minority government propped up by Labour — blowing a hole in Labour’s status as the default governing party and safe vote to stop the right, and echoing recent by-elections in Caerphilly (won by Plaid) and Manchester (won by Greens). POLITICO visited south Wales and spoke to 30 politicians and officials across Labour, Plaid and Reform. | Dan Bloom/POLITICO It would raise the simple question, said a senior Welsh Labour official granted anonymity to speak frankly: “What is the point in this party?’” POLITICO visited south Wales and spoke to 30 politicians and officials across Labour, Plaid and Reform, including interviews with all three of their Welsh leaders, for this piece and an episode of the Westminster Insider podcast. The conversations painted a vivid picture of a center-left establishment fighting for survival in an election that could echo far beyond Wales. While in the 1980s Welsh Labour could unite voters against Margaret Thatcher’s Conservatives, now it is battling demographic changes, a decline in unionized heavy industry and an anti-incumbent backlash. All have killed old loyalties and habits. Squeezed by Plaid and Greens to their left and Reform to their right, some in Labour see parallels with other mainstream postwar parties facing a reckoning across Europe. This week, Germany’s conservative Christian Democrats and center-left Social Democrats lost to the Greens in the car production region of Baden-Württemberg; the latter barely scraped 5 percent. In the recent Manchester by-election, the Conservatives lost their deposit. Welsh Labour MPs fear a reckoning. One said: “We will have to start again. We rebuild. We figure out, what does Welsh Labour mean in 2026? What do we stand for?” NEW CHAPTER, SAME AUTHOR It takes Morgan 20 minutes to walk the 500 meters from Newport Market to our interview. Some passers-by flag her down; others she ambushes. We pass a baked goods shop (“Ooh, Gregg’s! That’s what I want!”) and Morgan emerges with a latte, though not with one of the chain’s famous sausage rolls. She introduces herself to one woman as “Eluned Morgan, first minister of Wales.” Her target looks vaguely bemused.  After the Covid pandemic, people are simply more aware of what the Welsh government actually does — which means Labour, as the incumbent, gets more blame when things go wrong. | Matthew Horwood/Getty Images A peer and ex-MEP who joined the Senedd in 2016, Morgan is a fixture of Wales’ Labour establishment who became first minister unopposed in August 2024 after her predecessor, Vaughan Gething, resigned over a donations scandal. “I didn’t have a mandate really, because I was just kind of thrown in,” she tells POLITICO midway up the high street. “I thought, right, I need a program, so I went out on the streets and took my program directly from the public without any filter.”  She is selling a nuts-and-bolts offer of new railway stations, a £2 bus fare cap and same-day mental health care. Morgan casts herself as the experienced option to beat what she calls the “separatists” of Plaid and the “concerning” rise of populism. She means Reform, which wants to scrap net zero targets and cut 580 Welsh civil service jobs. Yet paradoxically, she also paints herself as a vessel for change. “[People] want to see change faster,” she said in John Frost Square, named after the leader of an 1839 uprising that demanded voting rights for all men. She wants to show “delivery” and “hope.” Dimitri Batrouni, Newport Council’s Labour leader, suggested an Amazonification of politics is under way. “Our lives commercially are instant,” he said. “I want something, I order it, it’s delivered to my house … people quite naturally want that in their governments.” But after 27 years, many voters are rolling the dice on delivery elsewhere. Welsh Labour is promising to end homelessness by 2034, but previously made the same pledge by 2026. Around 6,900 people are still waiting two years or more for NHS treatment (though this figure was 10 times higher during the Covid-19 pandemic). Education rankings slumped in 2023. At Newport’s Friars Walk shopping center, retired mechanical engineer Roy Wigmore, 81, said all politicians are liars. “I’ve voted Labour all my life until now,” he said, “but I’ll probably vote for somebody else — probably Nigel Farage.” ‘SHIT, WELL, HE DIDN’T CALL ME’ Much of this anger is pointed at Westminster — which is why Labour has long tried to show a more socialist face to Wales.  It was the seat of Labour co-founder Keir Hardie as well as of Nye Bevan, who launched Britain’s National Health Service in 1948. “Welsh Labour” was born out of the first Senedd-style elections in 1999, when Plaid surged in south Wales heartlands while Tony Blair’s New Labour appealed to the middle classes. For years, this deliberate rebranding worked; Labour pulled through with the most seats even when the Tories ruled Westminster. Yet in 2024, the party boasted of “two Labour governments at both ends of the M4” — in London and in Cardiff — working in harmony. The emphasis soon flipped back when things went wrong in No. 10; Morgan promised a “red Welsh way” last May. She is “trying to find our identity again,” said the MP quoted above. Morgan appeared to disown the “both ends of the M4” approach, while declining to call it a mistake. “Look, that was a decision before I became first minister,” she said. A peer and ex-MEP who joined the Senedd in 2016, Morgan is a fixture of Wales’ Labour establishment who became first minister unopposed in August 2024 after her predecessor, Vaughan Gething, resigned over a donations scandal. | Matthew Horwood/Getty Images She tries to be playful in distancing herself from Keir Starmer. “He came down a couple of weeks ago and I was very clear with him, if you’re coming you need to bring something with you. Fair play, he brought £14 billion of investment,” she said. “If he wants to come again, he’ll have to bring me more money.” But she has also hitched herself to Starmer for now — unlike Scottish Labour leader Anas Sarwar, who has called for the PM to go. As we sat down, Morgan professed surprise at news that Sarwar called several Cabinet ministers beforehand. “Did he! Shit, well, he didn’t call me,” she said. “Look at the state of the world at the moment; actually what we need is stability,” she added. “We need the grown-ups in the room to be in charge, and I do think Keir Starmer is a grown-up.” ‘ELUNED WASN’T HAPPY’ Morgan has mounted a fightback since Plaid won October’s Caerphilly by-election.  She has hired Matt Greenough, a strategist who worked on London Mayor Sadiq Khan’s re-election campaign last year, said three people with knowledge of the appointment. One of the people said: “During Caerphilly, it became quite clear there were a lot of problems. Eluned wasn’t happy with Welsh Labour or the way the campaign was running. She did a lot of lobbying and got the Welsh executive to basically give her complete power over the campaign.” Morgan “was angry that the central party [in London] took control of the Caerphilly by-election,” another of the people added. (A Morgan ally disputed this reading of events, saying she would always take a bigger role as the election drew near, and that a wide range of Labour figures are involved in the campaign committee such as a Westminster MP, Torsten Bell.) Morgan also has more support these days from Labour’s MPs — who pushed last year for her to focus less on Plaid and more on Reform. That lobbying may have been a mistake, the MP quoted above admits now. “We were quite naive in thinking that the progressives would back us,” this MP said. Privately, Labour politicians and officials in Wales say the mood and prospects are better than the start of 2026. Though asked if Labour would win the most seats in the Senedd, Batrouni said: “Let’s look and see. It’s not looking good in the polls but … politics changes so quickly.” IT’S NOT JUST ABOUT KEIR STARMER The harsh reality is that Labour’s base in Wales began slipping long before Starmer, rooted in deindustrialization since the 1970s and 80s. Newport, near England on the M4 corridor, has a measure of prosperity that other parts of Wales do not. The 137-year-old market has had a makeover, Microsoft is building data centers and U.S. giant Vishay runs Britain’s biggest semiconductor plant. Here Labour is mostly expecting a fight between itself and Reform. At Newport’s Friars Walk shopping center, retired mechanical engineer Roy Wigmore, 81, said all politicians are liars. “I’ve voted Labour all my life until now,” he said, “but I’ll probably vote for somebody else — probably Nigel Farage.” | Jon Rowley/Getty Images Wales’ west coast and north west are more Plaid-dominated, with more Welsh speakers and independence supporters. But support for nationalists is spreading in the southern valleys. “All across the valleys you’re seeing places where Labour has dominated for 100 years plus but is now in deep, deep crisis,” said Richard Wyn Jones, professor of Welsh politics at Cardiff University. “It has long been the case that a lot of Labour supporters have had a very positive view of Plaid Cymru — they just didn’t have a reason to vote for them until now.” Wyn Jones attributes the change to trends across northern Europe, where traditional left-wing parties have been “unmoored” from working-class occupations. A growing service sector has brought more white-collar voters with socially liberal values. Carmen Smith, a 29-year-old Plaid campaigner who is the House of Lords’ youngest-ever peer, said Brexit had unhitched young, left-leaning voters from the idea of British patriotism: “There are a lot more young people identifying as Welsh rather than British.”  And after the Covid pandemic, people are simply more aware of what the Welsh government actually does — which means Labour, as the incumbent, gets more blame when things go wrong.  All the while, a left-behind contingent of socially conservative ex-Labour voters is turning to Reform UK. At the Tumble Inn, a Wetherspoons chain pub in the valley town of Pontypridd, retired gas engineer Paul Jones remembered: “You could leave one job, walk a couple of hundred yards and start another job … it was a totally different world. I wish we could get it back, but I don’t think it’s going to happen.” He hasn’t voted for years but plans to back Reform. THEY’VE BLOWN UP THE MAP All these changes will be turbocharged by a new electoral map. A previous Labour first minister, Mark Drakeford, introduced a more proportional voting system which will see voters elect six Senedd members in each of 16 super-constituencies. The results will reflect the mood better than U.K. general elections (Labour won 84 percent of Wales’ seats on a 37 percent vote share in 2024), but create a volatile outcome. In the mega-constituency for eastern Cardiff, Wyn Jones believes the six seats could be won by six parties: Labour, Plaid, Reform, the Conservatives, Greens and Liberal Democrats. Ironically, said the Labour MP quoted above, Welsh Labour is now polling so badly that it could actually win more seats under the new system than the old one. Trying to win the sixth seat in each super-constituency will hoover up many resources. The size of each patch changes how parties campaign, said Plaid’s Westminster leader Liz Savile Roberts: “We’ve had to go to places that I’ve never been to.” And the scale means activists have a weaker connection to the candidates they campaign for — compounded in Labour by many Senedd members stepping down. Just six people turned up to one recent Labour door-knocking session in a heartland seat. A left-behind contingent of socially conservative ex-Labour voters is turning to Reform UK. | Huw Fairclough/Getty Images After May 8, the new system will make coalitions or informal support deals more necessary to command a Senedd majority. Morgan declined to say if she would support Plaid’s £400 million-a-year offer to expand free childcare (which Labour says is unfunded), rather than see it voted down. “I’m certainly not getting into hypotheticals,” she said. “I’m in this to win it.”  Her rivals have other ideas. THE PRESIDENT IS COMING On the hill above Newport, a two-story presidential-style image of Rhun ap Iorwerth filled a screen at the International Convention Centre above the words: “New leadership for Wales.” The former BBC presenter, who took over Plaid’s leadership in 2023, strained not to make his February conference look like a premature victory lap. Members could’ve been fooled. They struggled to find parking. There were more lobbyists; more journalists. It is a slow burn for a party founded in 1925, which won its first Westminster seat in 1966. Ap Iorwerth ramped up the anti-establishment rhetoric in his conference speech while Lindsay Whittle, who won Caerphilly for Plaid in October’s by-election, bellowed: “Rich men from London, we are waiting for you!” Yet he insists his success is more than a protest vote, a trend sweeping Europe or a mirror of Reform’s populism. “I’d like to think that we’re doing something different,” Ap Iorwerth told POLITICO. While Morgan accuses him of “separatism,” he said: “We have a growing sense of Welsh nationhood and Welsh identity, at a time when there’s deep disillusionment in the old guard of U.K. politics and a sense of needing to keep at bay that populist right wing.” Ap Iorwerth said there is a “very real danger” that Labour vanishes entirely as a serious force in the Senedd. “The level of support that they have collapsed to is a level that most people, probably myself included, could never have imagined would happen so quickly,” he said. INDEPENDENCE DAY? But Plaid faces three big challenges to hold this pole position. The first is its ground game, stretched thin to cover the new world of mega-seats. On the hill above Newport, a two-story presidential-style image of Rhun ap Iorwerth filled a screen at the International Convention Centre above the words: “New leadership for Wales.” | Matthew Horwood/Getty Images The second is to remain distinct from Labour and the insurgent Greens while running a broad left-leaning platform focused on energy costs, childcare and the NHS. The third is to convince unionist voters that Plaid is not simply a Trojan horse for Welsh independence. Independence is Plaid’s core belief, yet Ap Iorwerth did not mention the word once in his speech, instead promising a “standing commission” to look at Wales’ future. He told POLITICO he would rather have a “sustained, engaging, deep discussion … than try to crash, bang, wallop, towards the line.”  But opponents suggest Plaid will push hard for independence if they win a second term in 2030 — like the Scottish National Party did after topping elections in 2007 then 2011. One conference attendee, Emyr Gruffydd, 36, a member for 19 years, said independence “is going to be part of our agenda in the future, definitely. But I think nation-building has to be the approach that we take in the first term.” Savile Roberts accepted that shelving talk of independence (which is still supported by less than half the Welsh population) is part of a deliberate strategy to broaden the party’s reach and keep a wide left-leaning appeal. “I mean, we know the people that we need to appeal to — it is the disenchanted Labour voters,” she said. For some shoppers in Newport — not Plaid’s home turf — it may be working. One ex-Labour voter, Rose Halford, said of Plaid: “All they want to do is make everybody speak Welsh.” But she’ll consider backing them: “They’re showing a bit more gumption, aren’t they?” TAXING QUESTIONS FOR PLAID If Plaid does win, that’s when the hard part begins. Ap Iorwerth would seek urgent talks about changing Wales’ funding formula from Westminster — but cannot say how much this would raise. And Plaid has vowed not to hike income tax, one of the few (blunt) tax instruments available to the Welsh government. Strategists looked at the issue before and feared it would prompt taxpayers to flee over the border to England. So Plaid promises vague financial “efficiencies” in areas such as child poverty, where spending exceeded £7 billion since 2022, and health. Whittle said: “There’s an awful lot of people pen-pushing in the health service. We don’t need pen-pushers.” Labour’s attack machine argues that Plaid and Reform UK alike would cut services. Ap Iorwerth insists his and Farage’s promises are different: “We’re talking about being effective and efficient.” But he admitted: “You don’t know the detail until you come into government.”  Ap Iorwerth jettisoned any suggestion that Plaid would introduce universal basic income, saying it is “not a pledge for government.” He added: “It’s something that I believe in as a principle. I don’t think we’re in a place where we have anything like a model that could be put in place now.” Ap Iorwerth would seek urgent talks about changing Wales’ funding formula from Westminster — but cannot say how much this would raise. | Matthew Horwood/Getty Images The blame game between Cardiff and Westminster will run hot. Ap Iorwerth voiced outrage this week at a leaked memo from Starmer in December, ordering his Cabinet to deliver directly in Wales and Scotland “even when devolved governments may oppose this.” FARAGE’S WELSH SURGE And then there’s Reform. Farage’s party has rocketed in the polls since 2024; typical branch meetings have swelled from a dozen members to several dozen. Since February, Reform has even had its own leader for Wales — Dan Thomas, a former Tory councillor in London who says he recently moved back to the area of Blackwood, in the south Wales valleys. Some party figures have observed a dip after the Caerphilly by-election, where Reform came second. Thomas insists: “I don’t think we’ve plateaued” — and even said there is room to increase a 31 percent vote share from one (optimistic) poll. “There’s still a Labour vote to squeeze,” he told POLITICO.  “We’re targeting all of Wales.” It is a measure of Plaid’s success that Reform UK often now presents the nationalist party as its main competition. “It’s a two-horse race [with Plaid], that’s what I say on the doors,” said Leanne Dyke, a Reform canvasser who was drinking in the Pontypridd Wetherspoons. James Evans, who is now one of Reform’s two Senedd members after he was thrown out of the Conservative group in January on suspicion of defection talks, argues his supporters are underrepresented in polling because they are “smeared” as bigots. Evans added: “Very similarly to what happened in America when Donald Trump was elected, I think there is a quiet majority of people out there who do not want to say they’re voting Reform, who will vote Reform.”  Reform has its own custom-built member app, ReformGo, as it canvasses data on where its supporters live for the first time. It sent a mass appeal by post to all registered Welsh voters in late 2025 (before spending limits kicked in). Welsh campaign director David Thomas is recruiting a brand new slate of 96 candidates, booking hotels for training days with interviews, written exercises and team-building. Daytime TV presenter Jeremy Kyle has helped with media training. English officials cross the border to help; Reform still only has three paid officials in Wales. FARAGE HAS AN NHS PROBLEM Lian Walker, a postal worker from the village of Pen-y-graig, would be a prime target for Reform. “There’s people who I see on the databases, they don’t work,” she said in Pontpridd’s Patriot pub, “but they get everything; new windows, earrings, T-shirts, shorts.” She supports Reform’s plans to deport migrants. But on the NHS, she says of Reform: “They want it to go private like America.” Labour and Plaid drive this attack line relentlessly. The full picture is more nuanced — but still exposes a tension between Farage and Thomas. But Farage has an advantage; the right is less split than the left. | Ben Birchall/PA Images via Getty Images While Reform emphasizes it would keep the NHS free at the point of use, Farage has not ruled out shifting its funding from general taxation to a French-style insurance model, saying that would be “a national decision ahead of a general election.” Thomas, however, broke from this stance. He told POLITICO: “No, no. We rule out any kind of insurance system or any kind of privatization.” He added: “Nigel’s also said that devolved issues are down to the Welsh party, and I wouldn’t consider any kind of insurance-based or private-based system for the Welsh NHS.” Labour and Plaid are relying on an anti-Reform vote to keep Farage’s party out of power. Opponents have also highlighted the jailing of Nathan Gill, Reform’s former Welsh leader, for taking bribes to give pro-Russia interviews and speeches. But Farage has an advantage; the right is less split than the left. In Evans’ sprawling rural seat of Brecon and Radnorshire, two people with knowledge of the Conservative association said its membership had fallen catastrophically from a recent peak of around 400. On the other hand, the sheer number of defections makes Reform look more like a copycat Conservative Party. A former Tory staffer works for Evans; Thomas’ press officer is the Welsh Conservatives’ former media chief. Evans said last year that 99 percent of Reform’s policies were “populist rubbish,” but was allowed to see the policy platform in secret before he agreed to join (and has since contributed to it). While the long-time former UKIP and Brexit Party politician Mark Reckless led a policy consultation in the first half of 2025, former Conservative Welsh Secretary David Jones — who defected without fanfare last year — played a hands-on role behind the scenes working up manifesto policies, two people with knowledge of his work said. THE NIGEL SHOW Then there is Reform’s reliance on Farage himself.  The party deliberately left it late before unveiling a Welsh leader, said a Reform figure in Wales, and chose in Thomas a Welsh figure who would not “detract from Nigel’s overall umbrella and brand.” While Welsh officials and politicians worked on the manifesto, Farage himself was involved in signing it off — as were several others in London, said Evans, including frontbench spokespeople Robert Jenrick, Suella Braverman and Zia Yusuf. Thomas said: “Ultimately, it’s my decision to sign off the manifesto. Of course, Nigel was consulted because he’s our U.K. leader, and we want to ensure that what’s going on in Wales is aligned to the broader picture in the UK.” Reform’s Welsh manifesto promises to cut a penny off every band of income tax by 2030, end Wales’ “nation of sanctuary” plan to support asylum seekers, scrap 20mph road speed limits and upgrade the M4 and A55 highways. But costings have not been published yet — Reform has sent them to be assessed by the Institute for Fiscal studies, a nonpartisan think tank — and like other parties, Reform faces questions about how it will all be paid for. Asked if Reform would begin work on the M4 and A55 upgrades by 2030, Thomas replied: “We’d like to. But we all know in this country, infrastructure projects take a long time.” While Welsh officials and politicians worked on the manifesto, Farage himself was involved in signing it off — as were several others in London, said Evans, including frontbench spokespeople Robert Jenrick, Suella Braverman and Zia Yusuf. | Huw Fairclough/Getty Images ‘I’VE GOT TO FOCUS ON WHAT I CAN CONTROL’ These harsh realities facing Wales’ would-be rulers are a silver lining for Labour. Morgan avoided POLITICO’s question about whether she believes the polls — “I’ve got to focus on what I can control” — but insisted many voters remain persuadable. “People will scratch the surface and say [our rivals] are not ready,” she said. Alun Michael, who led the first Welsh Labour administration in 1999, said the idea that the Labour vote has “collapsed completely” is wrong. “It’s always dangerous to go on opinion polls as a decider of what will happen in an election,” he said. Whoever does win will deserve a moment of levity. If Ap Iorwerth wins the most seats on May 7, he will drink an Aperol spritz; Thomas will have a glass of Penderyn Welsh whisky.  As for Morgan? She would like a cup of tea — milk, no sugar. Perhaps survival would be sweet enough.

The Trump administration wants some of the world’s largest technology companies to publicly commit to a new compact governing the rapid expansion of AI data centers, according to two administration officials granted anonymity to discuss private conversations. A draft of the compact obtained by POLITICO lays out commitments designed to ensure energy-hungry data centers do not raise household electricity prices, strain water supplies or undermine grid reliability, and that the companies driving demand also carry the cost of building new infrastructure. The proposed pact, which is not final and could be subject to change, is framed as a voluntary agreement between President Donald Trump and major U.S. tech companies and data center developers. It could bind OpenAI, Microsoft, Google, Amazon, Facebook parent Meta and other AI giants to a broad set of energy, water and community principles. None of these companies immediately responded to a request for comment. The initiative, which the administration wants to roll out with a splashy White House event, has yet to be formally announced – and it remains unclear which companies have agreed to the compact or been invited to participate. The compact would mark one of the most ambitious efforts to shape the footprint of AI infrastructure without imposing direct regulation, and comes a month after the White House made an unprecedented appeal to the mid-Atlantic energy grid operator to try to lower electricity prices. Concerns have steadily risen that data centers’ enormous appetite for energy could drive prices up even more, which could become even more of a political liability for an administration that’s been all-in on the rapid, unbridled development of data centers. The compact is one way to try to tout work to blunt their impact ahead of the midterms. “As President Trump announced weeks ago, top tech companies are working with the President to ‘pick up the tab’ for their power consumption as they build data centers. More to come soon!” White House spokesperson Taylor Rogers said in a statement. A White House official said the draft is “is outdated and no longer accurate” without specifying which parts have changed. The decentralized nature of the nation’s electricity grid means that grid operators, state regulators and utilities themselves would have to agree to set rules or to craft contracts in order to make aspects of the proposed compact actionable. The effort comes as electric utilities, regulators and lawmakers warn that the explosive growth of AI-driven data centers – the warehouse-sized buildings that house powerful chips and servers for the development of AI technology – could overwhelm regional power systems and drive up electricity bills for consumers already worried about the cost of living. “People are skeptical. ‘Oh my gosh, this is going to further add insult to injury and drive up my energy prices.’ I understand their concerns,” Energy Secretary Chris Wright said in an interview with the POLITICO Energy podcast. “We are in dialogue with all the hyperscale developers about not only being a long-term force to drive down electricity prices on the grid, but to also be a short-term force to stop the existing price rises.” Major tech companies known as “hyperscalers” are building bigger data centers to process more advanced AI computing. At the core of the compact is a requirement that AI data center developers pay 100 percent of the cost of new power generation needed to serve their facilities. The compact also calls on companies to sign long-term electricity contracts to ensure other customers don’t end up footing the bill if the data center fails. Companies would similarly commit to paying the full cost of any current or future transmission upgrades required to interconnect new data centers to the grid. In parallel, the tech companies would agree to work with federal, state and local regulators to establish power and transmission rates that, “in every manner possible,” hold harmless and ideally reduce residential electricity prices in the jurisdictions where data centers operate. To prevent companies from outsourcing impacts, the principles would apply not only to data centers they own, but also to capacity they lease or operate that is owned by others.Electricity costs are already rising, even outpacing the rate of inflation over the past year. Utilities have requested record-breaking rate increases and government data predicts costs will continue to rise in the coming years. The insatiable demand from data centers — which the federal government predicts could as much as triple between 2025 and 2028 — has already been attributed for driving up prices in the power grid that covers parts of 13 mid-Atlantic and Midwest states. A 2025 Bloomberg News analysis found that power prices have risen in the areas directly around data centers and a separate 2025 paper from the Harvard Law School Environmental and Energy Law Program found that consumers are shouldering the costs of grid infrastructure that serves data centers. The White House and industry allies, however, say that data centers are not to blame and that data centers can be a meaningful force to drive down the price of electricity. A report released last week by the Edison Electric Institute, the trade group representing investor-owned utilities, said that most areas with data centers are not seeing higher costs. Instead, the report said, well-crafted data center tariffs and agreements that put more of the responsibility for new power generation and infrastructure on large tech companies could help reduce costs for consumers. That, however, requires state utility regulators to craft tariff agreements and power contracts that fully account for tech companies’ costs. Wright singled out two states in particular that have seen the greatest growth in demand for electricity due to data center developments but have not had corresponding increases in electricity prices. That includes North Dakota, which had roughly 35 percent growth in electricity demand over the past five years. “And their nominal price of electricity has not gone up.The real price of electricity has gone down meaningfully over that five year period,” Wright said. PICKING UP THE TAB The compact comes just weeks after Microsoft made a similar set of commitments , saying it would pay more for the electricity that serves its data centers, cover any additional infrastructure and reduce water consumption. Microsoft also said it would no longer accept any local tax breaks, a measure not included in the White House draft compact. Trump touted the Microsoft announcement last month in a Truth Social post, where he indicated that he was working with other tech companies to “ensure that Americans don’t ‘pick up the tab’ for their POWER consumption.” “You will see more announcements,” Wright said. “You probably saw one from Google in Georgia, freezing electricity prices for three years with their deals. You will hear some deals later this year where large data center developments are announced commensurate with declines in electricity prices.” Other companies have also said that they already pay their own costs. Meta, for example, has said that it covers all of its energy costs and commissioned a study last year that found that the clean energy projects it has supported add additional generation and do not raise costs for ratepayers. The draft also pulls data centers more directly into grid reliability planning. Signatories would commit to using noncritical backup generation at new and existing facilities, in coordination with grid operators, to support stability and reliability during emergencies. Companies would further agree, on a voluntary basis, to allow new data center load to be curtailed when necessary to ensure reliable power for American households, a growing concern for grid operators facing rising peak demand and extreme weather events. The idea of grid flexibility and backup power has been growing in policy circles. Texas lawmakers last year passed a landmark bill that would require large power users like data centers to reduce power or be disconnected from the grid in emergencies. Other states and grid operators are exploring similar programs. During last month’s winter storm, Wright also called on grid operators to make backup power from data centers available. Beyond energy, the compact aims to address local opposition in fast-growing data center regions. Hyperscalers would commit to being “water positive,” developing or procuring sufficient water supplies to support new facilities and ensuring no negative impact on local water availability or quality. The agreement also calls on companies to establish AI educational awareness programs in surrounding communities and public schools, and to adopt best practices to mitigate noise, traffic and other disruptions affecting nearby residential neighborhoods. The pact could be meaningful for companies seeking federal help to accelerate grid interconnections, a major bottleneck for AI infrastructure projects. Under the draft, the federal government would commit to supporting accelerated interconnection of new data centers to what’s called the bulk power system that ships high-voltage power across regions.

It seems impossible to have a conversation today without artificial intelligence (AI) playing some role, demonstrating the massive power of the technology. It has the potential to impact every part of business, and European policymakers are on board. In February 2025, Ursula von der Leyen, the European Commission president, said, “We want Europe to be one of the leading AI continents … AI can help us boost our competitiveness, protect our security, shore up public health, and make access to knowledge and information more democratic.” Research from Nokia suggests that businesses share this enthusiasm and ambition: 84 percent of more than 1,000 respondents said AI features in the growth strategy of their organization, while 62 percent are directing at least 20 percent of ICT capex budgets toward the technology. However, the equation is not yet balanced. Three-quarters of survey respondents state that current telecom infrastructure limits the ability to deliver on those ambitions. Meanwhile, 45 percent suggest these limitations would delay, constrain or entirely limit investments. There is clearly a disconnect between the ambition and the ability to deliver. At present, Europe lags the United States and parts of Asia in areas such as network deployment, related investment levels and scale. > If AI does not reach its full potential, EU competitiveness will suffer, > economic growth will have a ceiling, the creation of new jobs will have a > limit and consumers will not see the benefits. What we must remember primarily is that AI does not happen without advanced, trusted and future-proofed networks. Infrastructure is not a ‘nice to have’ it is a fundamental part. Simply put, today’s networks in Europe require more investments to power the AI dream we all have. If AI does not reach its full potential, EU competitiveness will suffer, economic growth will have a ceiling, the creation of new jobs will have a limit and consumers will not see the benefits. When we asked businesses about the challenge of meeting AI demands during our research, the lack of adequate connectivity infrastructure was the fourth common answer out of 15 potential options. Our telecom connectivity regulatory approach must be more closely aligned with the goal of fostering AI. That means progressing toward a genuine telecom single market, adopting a novel approach to competition policy to allow market consolidation to lead to more investments, and ensuring connectivity is always secure and trusted. Supporting more investments in next-generation networks through consolidation AI places heavy demands on networks. It requires low latency, high bandwidth and reliability, and efficient traffic management. To deliver this, Europe needs to accelerate investment in 5G standalone, fiber to enterprises, edge data centers and IP-optical backbone networks optimized for AI. > As industry voices such as Nokia have emphasized, the networks that power AI > must themselves make greater use of automation and AI. Consolidation (i.e. reducing the number of telecom operators within the national telecom markets of EU member states) is part of the solution. Consolidation will allow operators to achieve economies of scale and improve operating efficiency, therefore encouraging investment and catalyzing innovation. As industry voices such as Nokia have emphasized, the networks that power AI must themselves make greater use of automation and AI. Policy support should therefore extend to both network innovation and deployment. Trust: A precondition for AI adoption Intellectual property (IP) theft is a threat to Europe’s industrial future and only trusted technology should be used in core functions, systems and sectors (such as energy, transport and defense). In this context, the underlying connectivity should always be secure and trusted. The 5G Security Toolbox, restricting untrusted technology, should therefore be extended to all telecom technologies (including fiber, optics and IP) and made compulsory in all EU member states. European governments must make protecting their industries and citizens a high priority. Completing the digital single market Although the single market is one of Europe’s defining projects, the reality in telecoms — a key part of the digital single market — is still fragmented. As an example, different spectrum policies create barriers across borders and can limit network roll outs. Levers on top of advanced connectivity To enable the AI ecosystem in Europe, there are several different enabling levers European policymakers should advance on top of fostering advanced and trusted connectivity: * The availability of compute infrastructure. The AI Continent Action Plan, as well as the IPCEI Compute Infrastructure Continuum, and the European High-Performance Computing Joint Undertaking should facilitate building AI data centers in Europe.   * Leadership in edge computing. There should also be clear support for securing Europe’s access to and leadership in edge solutions and building out edge capacity. Edge solutions increase processing speeds and are important for enabling AI adoption, while also creating a catalyst for economic growth. With the right data center capacity and edge compute capabilities available, European businesses can meet the new requirements of AI use cases.  * Harmonization of rules. There are currently implications for AI in several policy areas, including the AI Act, GDPR, Data Act, cybersecurity laws and sector-specific regulations. This creates confusion, whereas AI requires clarity. Simplification and harmonization of these regulations should be pursued.  * AI Act implementation and simplification. There are concerns about the implementation of the AI Act. The standards for high-risk AI may not be available before the obligations of the AI act enter into force, hampering business ambitions due to legal uncertainty. The application date of the AI Act’s provisions on high-risk AI should be postponed by two years to align with the development of standards. There needs to be greater clarity on definitions and simplification measures should be pursued across the entire ecosystem. Policies must be simple enough to follow, otherwise adoption may falter. Policy needs to act as an enabler, not a barrier to innovation.  * Upskilling and new skills. AI will require new skills of employees and users, as well as creating entirely new career paths. Europe needs to prepare for this new world.  If Europe can deliver on these priorities, the benefits will be tangible: improved services, stronger industries, increased competitiveness and higher economic growth. AI will deliver to those who best prepare themselves. We must act now with the urgency and consistency that the moment demands. -------------------------------------------------------------------------------- Author biography: Marc Vancoppenolle is leading the geopolitical and government relations EU and Europe function at Nokia. He and his team are working with institutions and stakeholders in Europe to create a favorable political and regulatory environment fostering broadband investments and cross sectoral digitalization at large. Vancoppenolle has over 30 years of experience in the telecommunication industry. He joined Alcatel in 1991, and then Alcatel-Lucent, where he took various international and worldwide technical, commercial, marketing, communication and government affairs leadership roles. Vancoppenolle is a Belgian and French national. He holds a Master of Science, with a specialization in telecommunication, from the University of Leuven complemented with marketing studies from the University of Antwerp. He is a member of the DIGITALEUROPE Executive Board, Associate to Nokia’s CEO at the ERT (European Round Table for Industry), and advisor to FITCE Belgium (Forum for ICT & Media professionals). He has been vice-chair of the BUSINESSEUROPE Digital Economy Taskforce as well as a member of the board of IICB (Innovation & Incubation Center Brussels).

Meta named former Trump adviser Dina Powell McCormick to serve as president and vice chair Monday, further cementing the company’s growing ties to Republicans and President Donald Trump’s White House. In addition to a long career on Wall Street, Powell McCormick served as Trump’s deputy national security adviser during his first term. She was also a member of the George W. Bush administration. She first joined Meta’s board last April, part of a broader play by the social media and artificial intelligence giant to hire Republicans following Trump’s election. In a statement, Meta CEO Mark Zuckerberg praised Powell McCormick’s “experience at the highest levels of global finance, combined with her deep relationships around the world, [which] makes her uniquely suited to help Meta manage this next phase of growth.” Rightward trend: Powell McCormick’s time in global finance — she spent 16 years as a partner at Goldman Sachs and was most recently a top executive at banking company BDT & MSD Partners — could be a major asset to Meta as it raises hundreds of billions of dollars to build out data centers and other AI-related infrastructure. But her GOP pedigree and proximity to Trump likely played a significant role in her hiring as well. Since Trump’s election, Meta has worked to curry favor with Republicans in the White House and on Capitol Hill. The company elevated former GOP official Joel Kaplan to serve as global affairs lead last January, simultaneously tapping Kevin Martin, a former Republican chair of the Federal Communications Commission, as his No. 2. Under pressure from Republicans, last year Meta also rolled back many of its former rules related to content moderation. In 2024, the company apologized to congressional Republicans — specifically Rep. Jim Jordan (R-Ohio), chair of the House Judiciary Committee — for removing content that contained disinformation about the Covid-19 pandemic. A Meta spokesperson declined to comment when asked whether Powell McCormick’s ties to Trump and Republicans played a role in her hiring. Trump thumbs up: In a Truth Social post Monday, Trump congratulated Powell McCormick and said Zuckerberg made a “great choice.” The president called her “a fantastic, and very talented, person, who served the Trump Administration with strength and distinction!”

Venture capitalist Finn Murphy believes world leaders could soon resort to deflecting sunlight into space if the Earth gets unbearably hot. That’s why he’s invested more than $1 million in Stardust Solutions, a leading solar geoengineering firm that’s developing a system to reduce warming by enveloping the globe in reflective particles. Murphy isn’t rooting for climate catastrophe. But with global temperatures soaring and the political will to limit climate change waning, Stardust “can be worth tens of billions of dollars,” he said. “It would be definitely better if we lost all our money and this wasn’t necessary,” said Murphy, the 33-year-old founder of Nebular, a New York investment fund named for a vast cloud of space dust and gas. Murphy is among a new wave of investors who are putting millions of dollars into emerging companies that aim to limit the amount of sunlight reaching the Earth — while also potentially destabilizing weather patterns, food supplies and global politics. He has a degree in mathematics and mechanical engineering and views global warming not just as a human and political tragedy, but as a technical challenge with profitable solutions. Solar geoengineering investors are generally young, pragmatic and imaginative — and willing to lean into the adventurous side of venture capitalism. They often shrug off the concerns of scientists who argue it’s inherently risky to fund the development of potentially dangerous technologies through wealthy investors who could only profit if the planet-cooling systems are deployed. “If the technology works and the outcomes are positive without really catastrophic downstream impacts, these are trillion-dollar market opportunities,” said Evan Caron, a co-founder of the energy-focused venture firm Montauk Capital. “So it’s a no-brainer for an investor to take a shot at some of these.” More than 50 financial firms, wealthy individuals and government agencies have collectively provided more than $115.8 million to nine startups whose technology could be used to limit sunlight, according to interviews with VCs, tech company founders and analysts, as well as private investment data analyzed by POLITICO’s E&E News. That pool of funders includes Silicon Valley’s Sequoia Capital, one of the world’s largest venture capital firms, and four other investment groups that have more than $1 billion of assets under management. Of the total amount invested in the geoengineering sector, $75 million went to Stardust, or nearly 65 percent. The U.S.-Israeli startup is developing reflective particles and the means to spray and monitor them in the stratosphere, some 11 miles above the planet’s surface. At least three other climate-intervention companies have also raked in at least $5 million. The cash infusion is a bet on planet-cooling technologies that many political leaders, investors and environmentalists still consider taboo. In addition to having unknown side effects, solar geoengineering could expose the planet to what scientists call “termination shock,” a scenario in which global temperatures soar if the cooling technologies fail or are suddenly abandoned. Still, the funding surge for geoengineering companies pales in comparison to the billions of dollars being put toward artificial intelligence. OpenAI, the maker of ChatGPT, has raised $62.5 billion in 2025 alone, according to investment data compiled by PitchBook. The investment pool for solar geoengineering startups is relatively shallow in part because governments haven’t determined how they would regulate the technology — something Stardust is lobbying to change. As a result, the emerging sector is seen as too speculative for most venture capital firms, according to Kim Zou, the CEO of Sightline Climate, a market intelligence firm. VCs mostly work on behalf of wealthy individuals, as well as pension funds, university endowments and other institutional investors. “It’s still quite a niche set of investors that are even thinking about or looking at the geoengineering space,” Zou said. “The climate tech and energy tech investors we speak to still don’t really see there being an investable opportunity there, primarily because there’s no commercial market for it today.” AEROSOLS IN THE STRATOSPHERE Stardust and its investors are banking on signing contracts with one or more governments that could deploy its solar geoengineering system as soon as the end of the decade. Those investors include Lowercarbon Capital, a climate-focused firm co-founded by billionaire VC Chris Sacca, and Exor, the holding company of an Italian industrial dynasty and perhaps the most mainstream investment group to back a sunlight reflection startup. Even Stardust’s supporters acknowledge that the company is far from a sure bet. “It’s unique in that there is not currently demand for this solution,” said Murphy, whose firm is also supporting out-there startups seeking to build robots and data centers in space. “You have to go and create the product in order to potentially facilitate the demand.” Lowercarbon partner Ryan Orbuch said the firm would see a return on its Stardust investment only “in the context of an actual customer who can actually back many years of stable, safe deployment.” Exor, another Stardust investor, didn’t respond to a request for comment. Other startups are trying to develop commercial markets for solar geoengineering. Make Sunsets, a company funded by billionaire VC Tim Draper, releases sulfate-filled weather balloons that pop when they reach the stratosphere. It sells cooling credits to individuals and corporations based on the theory that the sulfates can reliably reduce warming. There are questions, however, about the science and economics underpinning the credit system of Make Sunsets, according to the investment bank Jeffries. “A cooling credit market is unlikely to be viable,” the bank said in a May 2024 note to clients. That’s because the temperature reductions produced by sulfate aerosols vary by altitude, location and season, the note explained. And the warming impacts of carbon dioxide emissions last decades — much longer than any cooling that would be created from a balloon’s worth of sulfate. Make Sunsets didn’t respond to a request for comment. The company has previously attracted the attention of regulators in the U.S. and Mexico, who have claimed it began operating without the necessary government approvals. Draper Associates says on its website that it’s “shaping a future where the impossible becomes everyday reality.” The firm has previously backed successful consumer tech firms like Tesla, Skype and Hotmail. “It is getting hotter in the Summer everywhere,” Tim Draper said in an email. “We should be encouraging every solution. I love this team, and the science works.” THE NEXT FRONTIER One startup is pursuing space-based solar geoengineering. EarthGuard is attempting to build a series of large sunlight deflectors that would be positioned between the sun and the planet, some 932,000 miles from the Earth. The company did not respond to emailed questions. Other space companies are considering geoengineering as a side project. That includes Gama, a French startup that’s designing massive solar sails that could be used for deep space travel or as a planetary sunshade, and Ethos Space, a Los Angeles company with plans to industrialize the moon. Both companies are part of an informal research network established by the Planetary Sunshade Foundation, a nonprofit advocating for the development of a trillion-dollar parasol for the globe. The network mainly brings together collaborators on the sidelines of space industry conferences, according to Gama CEO Andrew Nutter. “We’re willing to contribute something if we realize it’s genuinely necessary and it’s a better solution than other solutions” to the climate challenge, Nutter said of the space shade concept. “But our business model does not depend on it. If you have dollar signs hanging next to something, that can bias your decisions on what’s best for the planet.” Nutter said Gama has raised about $5 million since he co-founded the company in 2020. Its investors include Possible Ventures, a German VC firm that’s also financing a nuclear fusion startup and says on its website that the firm is “relentlessly optimistic — choosing to focus on the possibilities rather than obsess over the risks.” Possible Ventures did not respond to a request for comment. Sequoia-backed Reflect Orbital is another space startup that’s exploring solar geoengineering as a potential moneymaker. The company based near Los Angeles is developing a network of satellite mirrors that would direct sunlight down to the Earth at night for lighting industrial sites or, eventually, producing solar energy. Its space mirrors, if oriented differently, could also be used for limiting the amount of sun rays that reach the planet. “It’s not so much a technological limitation as much as what has the highest, best impact. It’s more of a business decision,” said Ally Stone, Reflect Orbital’s chief strategy officer. “It’s a matter of looking at each satellite as an opportunity and whether, when it’s over a specific geography, that makes more sense to reflect sunlight towards or away from the Earth.” Reflect Orbital has raised nearly $28.7 million from investors including Lux Capital, a firm that touts its efforts to “turn sci-fi into sci-fact” and has invested in the autonomous defense systems companies Anduril and Saildrone.” Sequoia and Lux didn’t respond to requests for comment. The startup hopes to send its first satellite into space next summer, according to Stone. SpaceX CEO Elon Musk, whose aerospace company already has an estimated fleet of more than 8,800 internet satellites in orbit, has also suggested using the circling network to limit sunlight. “A large solar-powered AI satellite constellation would be able to prevent global warming by making tiny adjustments in how much solar energy reached Earth,” Musk wrote on X last month. Neither he nor SpaceX responded to an emailed request for comment. DON’T CALL IT GEOENGINEERING Other sunlight-reflecting startups are entering the market — even if they’d rather not be seen as solar geoengineering companies. Arctic Reflections is a two-year-old company that wants to reduce global warming by increasing Arctic sea ice, which doesn’t absorb as much heat as open water. The Dutch startup hasn’t yet pursued outside investors. “We see this not necessarily as geo-engineering, but rather as climate adaptation,” CEO Fonger Ypma said in an email. “Just like in reforestation projects, people help nature in growing trees, our idea is that we would help nature in growing ice.” The main funder of Arctic Reflections is the British government’s independent Advanced Research and Invention Agency. In May, ARIA awarded $4.41 million to the company — more than four times what it had raised to that point. Another startup backed by ARIA is Voltitude, which is developing micro balloons to monitor geoengineering from the stratosphere. The U.K.-based company didn’t respond to a request for comment. Altogether, the British agency is supporting 22 geoengineering projects, only a handful of which involve startups. “ARIA is only funding fundamental research through this programme, and has not taken an equity stake in any geoengineering companies,” said Mark Symes, a program director at the agency. It also requires that all research it supports “must be published, including those that rule out approaches by showing they are unsafe or unworkable.” Sunscreen is a new startup that is trying to limit sunlight in localized areas. It was founded earlier this year by Stanford University graduate student Solomon Kim. “We are pioneering the use of targeted, precision interventions to mitigate the destructive impacts of heatwave on critical United States infrastructure,” Kim said in an email. But he was emphatic that “we are not geoengineering” since the cooling impacts it’s pursuing are not large scale. Kim declined to say how much had been raised by Sunscreen and from what sources. As climate change and its impacts continue to worsen, Zou of Sightline Climate expects more investors to consider solar geoengineering startups, including deep-pocketed firms and corporations interested in the technology. Without their help, the startups might not be able to develop their planet-cooling systems. “People are feeling like, well wait a second, our backs are kind of starting to get against the wall. Time is ticking, we’re not really making a ton of progress” on decarbonization, she said. “So I do think there’s a lot more questions getting asked right now in the climate tech and venture community around understanding it,” Zou said of solar geoengineering. “Some of these companies and startups and venture deals are also starting to bring more light into the space.” Karl Mathiesen contributed reporting.

Europe’s security does not depend solely on our physical borders and their defense. It rests on something far less visible, and far more sensitive: the digital networks that keep our societies, economies and democracies functioning every second of the day. > Without resilient networks, the daily workings of Europe would grind to a > halt, and so too would any attempt to build meaningful defense readiness. A recent study by Copenhagen Economics confirms that telecom operators have become the first line of defense in Europe’s security architecture. Their networks power essential services ranging from emergency communications and cross-border healthcare to energy systems, financial markets, transport and, increasingly, Europe’s defense capabilities. Without resilient networks, the daily workings of Europe would grind to a halt, and so too would any attempt to build meaningful defense readiness. This reality forces us to confront an uncomfortable truth: Europe cannot build credible defense capabilities on top of an economically strained, structurally fragmented telecom sector. Yet this is precisely the risk today. A threat landscape outpacing Europe’s defenses The challenges facing Europe are evolving faster than our political and regulatory systems can respond. In 2023 alone, ENISA recorded 188 major incidents, causing 1.7 billion lost user-hours, the equivalent of taking entire cities offline. While operators have strengthened their systems and outage times fell by more than half in 2024 compared with the previous year, despite a growing number of incidents, the direction of travel remains clear: cyberattacks are more sophisticated, supply chains more vulnerable and climate-related physical disruptions more frequent. Hybrid threats increasingly target civilian digital infrastructure as a way to weaken states. Telecom networks, once considered as technical utilities, have become a strategic asset essential to Europe’s stability. > Europe cannot deploy cross-border defense capabilities without resilient, > pan-European digital infrastructure. Nor can it guarantee NATO > interoperability with 27 national markets, divergent rules and dozens of > sub-scale operators unable to invest at continental scale. Our allies recognize this. NATO recently encouraged members to spend up to 1.5 percent of their GDP on protecting critical infrastructure. Secretary General Mark Rutte also urged investment in cyber defense, AI, and cloud technologies, highlighting the military benefits of cloud scalability and edge computing – all of which rely on high-quality, resilient networks. This is a clear political signal that telecom security is not merely an operational matter but a geopolitical priority. The link between telecoms and defense is deeper than many realize. As also explained in the recent Arel report, Much More than a Network, modern defense capabilities rely largely on civilian telecom networks. Strong fiber backbones, advanced 5G and future 6G systems, resilient cloud and edge computing, satellite connectivity, and data centers form the nervous system of military logistics, intelligence and surveillance. Europe cannot deploy cross-border defense capabilities without resilient, pan-European digital infrastructure. Nor can it guarantee NATO interoperability with 27 national markets, divergent rules and dozens of sub-scale operators unable to invest at continental scale. Fragmentation has become one of Europe’s greatest strategic vulnerabilities. The reform Europe needs: An investment boost for digital networks At the same time, Europe expects networks to become more resilient, more redundant, less dependent on foreign technology and more capable of supporting defense-grade applications. Security and resilience are not side tasks for telecom operators, they are baked into everything they do. From procurement and infrastructure design to daily operations, operators treat these efforts as core principles shaping how networks are built, run and protected. Therefore, as the Copenhagen Economics study shows, the level of protection Europe now requires will demand substantial additional capital. > It is unrealistic to expect world-class, defense-ready infrastructure to > emerge from a model that has become structurally unsustainable. This is the right ambition, but the economic model underpinning the sector does not match these expectations. Due to fragmentation and over-regulation, Europe’s telecom market invests less per capita than global peers, generates roughly half the return on capital of operators in the United States and faces rising costs linked to expanding security obligations. It is unrealistic to expect world-class, defense-ready infrastructure to emerge from a model that has become structurally unsustainable. A shift in policy priorities is therefore essential. Europe must place investment in security and resilience at the center of its political agenda. Policy must allow this reality to be reflected in merger assessments, reduce overlapping security rules and provide public support where the public interest exceeds commercial considerations. This is not state aid; it is strategic social responsibility. Completing the single market for telecommunications is central to this agenda. A fragmented market cannot produce the secure, interoperable, large-scale solutions required for modern defense. The Digital Networks Act must simplify and harmonize rules across the EU, supported by a streamlined governance that distinguishes between domestic matters and cross-border strategic issues. Spectrum policy must also move beyond national silos, allowing Europe to avoid conflicts with NATO over key bands and enabling coherent next-generation deployments. Telecom policy nowadays is also defense policy. When we measure investment gaps in digital network deployment, we still tend to measure simple access to 5G and fiber. However, we should start considering that — if security, resilience and defense-readiness are to be taken into account — the investment gap is much higher that the €200 billion already estimated by the European Commission. Europe’s strategic choice The momentum for stronger European defense is real — but momentum fades if it is not seized. If Europe fails to modernize and secure its telecom infrastructure now, it risks entering the next decade with a weakened industrial base, chronic underinvestment, dependence on non-EU technologies and networks unable to support advanced defense applications. In that scenario, Europe’s democratic resilience would erode in parallel with its economic competitiveness, leaving the continent more exposed to geopolitical pressure and technological dependency. > If Europe fails to modernize and secure its telecom infrastructure now, it > risks entering the next decade with a weakened industrial base, chronic > underinvestment, dependence on non-EU technologies and networks unable to > support advanced defense applications. Europe still has time to change course and put telecoms at the center of its agenda — not as a technical afterthought, but as a core pillar of its defense strategy. The time for incremental steps has passed. Europe must choose to build the network foundations of its security now or accept that its strategic ambitions will remain permanently out of reach. -------------------------------------------------------------------------------- Disclaimer POLITICAL ADVERTISEMENT * The sponsor is Connect Europe AISBL * The ultimate controlling entity is Connect Europe AISBL * The political advertisement is linked to advocacy on EU digital, telecom and industrial policy, including initiatives such as the Digital Networks Act, Digital Omnibus, and connectivity, cybersecurity, and defence frameworks aimed at strengthening Europe’s digital competitiveness. More information here.

A major five-year effort to build a technology base for Europe free of U.S. influence foundered amid conflicting national strategies and powerful corporate lobbying. As Europe’s leaders once again discuss tackling American tech dependence, those involved in the project to build a European cloud warn against repeating past mistakes. The Gaia-X initiative was “a crushing failure, a colossal waste of time, and just as many years gained for the hyperscalers — in other words, an industrial disaster,” said Yann Lechelle, a former CEO of French cloud champion Scaleway and one of the founding members of the initiative who quit in frustration in 2021, describing it as the “best decision ever.” The industry-led project was born in 2019 from a Franco-German drive to forge a “European industrial policy fit for the 21st Century” — a rallying cry that brought German and French companies together with top political backing to create a data infrastructure. The endgame goal of Gaia-X, named after the Greek goddess of Earth, was to “establish data sovereignty in Europe” and “counteract monopolistic tendencies.” As political momentum once again swings behind digital sovereignty, leaders will gather in Berlin on Tuesday to talk about how to become less dependent on foreign-owned technology. POLITICO spoke to both current and former Gaia-X officials, both on and off the record, about the lessons they learned that could prove valuable. Those conversations illuminated an initiative that failed to help Europe’s own digital ecosystem take root because it was weighed down by politics, bureaucracy and the interference of precisely the American and Chinese tech titans it was meant to challenge. Despite a fast-growing market for cloud computing services that underpin the internet, the global share of European cloud providers has continued to fall, dwarfed by the dominance of Amazon, Microsoft and Google. One of Gaia-X’s initial success stories, called Agdatahub, which was touted as a triumph for farming data, went bankrupt last year. “I joined Gaia-X because I believed in the original mission. I left Gaia-X because I didn’t believe it was going in the original direction,” said its former CEO, Francesco Bonfiglio. FRANCO-GERMAN DIVIDES Misalignment among the founding companies on the mission of Gaia-X became apparent early on, consistent with the traditional divergence in Paris and Berlin over tech sovereignty. In Paris, sovereignty was about backing local champions and breaking reliance on the U.S., while Berlin focused on protecting Europe without severing important trade ties. “The influence of political happenings inside the association was evident. Sometimes they were clashing,” said Bonfiglio, describing how it pitted a “historically more protectionist” France against a “fluctuating” Germany. American cloud giants Amazon, Microsoft and Google, as well as Chinese tech giants Huawei and Alibaba, are all members of Gaia-X. | Jonas Roosens/Getty Images Everybody “interpreted” Gaia-X as they wanted to, he said. The former CEO described how this divergence in expectations and a lack of a “clear or common” definition of sovereignty — let alone a shared understanding of what it would take to get there — made his task extremely difficult. “France turned it into a very political issue, whereas the Germans treated it more as a technical matter,” said another founding member of Gaia-X, who is still part of the initiative and was granted anonymity to speak candidly. The interests were at odds from day one, founding member Lechelle recalled, which was part of the reason the initiative would never deliver “the fantasy of a European cloud Airbus.” The Germans came on board with the idea to create data sovereignty, by shielding the data of their citizens and industries from foreign snooping and legal control, he said, adding: “Atlanticist as they may be, they were totally fine with the idea of depending on Microsoft.” Meanwhile, the French pushed a more self-serving vision, hoping to see Europe become self-reliant, from infrastructure all the way to software. That’s how the mission to create a “federated cloud infrastructure” came to life. But that “staggering complexity” would soon turn into an “unmanageable mess,” said Lechelle. Current CEO Ulrich Ahle, who joined in 2023, pushed back — saying Gaia-X is far from a “failure.” It has united the industry — both large and small players — around tangible deliverables, such as federated data spaces and compliance labels, he said. “At the beginning, some people thought that Gaia-X would be the European hyperscaler as the competition to Amazon, Google, Microsoft, Alibaba and so on,” he said, but in fact, “it is more about creating a way to handle data in a European way.” “The results we’re providing and the real business benefits these interoperable data spaces are creating are more and more visible,” he said, highlighting the example of a data space based on Gaia-X standards that French energy company EDF will use to securely coordinate the construction of new nuclear sites. BACK-DOOR LOBBYING As Gaia-X grew and set out to define Europe’s blueprint for secure data sharing, it opened its doors to industry participants from beyond Europe in a bid to push new standards on the global stage. While board seats remained reserved for EU companies and industry groups, alarm bells grew louder that the project was being hijacked by the very players it was meant to take on. Those firms “steered the entire roadmap,” Lechelle said, throwing money and people at it. “The committees were drowning. They [global players] had the capacity, the bandwidth, but we were already underwater … Americans have full-time lobbyists and massive budgets. Their job is basically to derail any initiative they don’t like.” American cloud giants Amazon, Microsoft and Google, as well as Chinese tech giants Huawei and Alibaba, are all members of Gaia-X. In 2021, the annual summit in Milan was sponsored by Huawei and Alibaba, prompting backlash. Some interviewees expressed criticism that the European industry associations and companies on the board were representing the interests of business partners abroad. “I was struggling against many, many forces that were trying to dilute the rules of verification, dilute the efforts,” said Bonfiglio, stressing he was “the CEO of a consensus-based organization where consensus couldn’t be achieved most of the time.” Bonfiglio said he didn’t regret opening up the initiative to foreign players. “The problem is not America vs. Europe,” he said, but “trust” or lack thereof. Letting non-EU providers in was supposed to force them to become more transparent, he argued. “You think you’re good, show us what you have,” was his mantra at the time, he said. He now acknowledges the unavoidable influence of corporate giants in the cloud space. “You don’t need Microsoft, Amazon and Google on the board, because they would be represented by people sitting on the board from European companies. It’s an indirect lobby,” he said. The current member of the association interviewed for this story said the bylaws of Gaia-X should be changed to kick out industry associations from the board, as they play into the hands of tech giants. In response, Gaia-X’s Ahle said that “the strategic directions are given and the strategic decisions are taken in the board of directors.” He touted the initiative’s top-tier certification label — which excludes non-EU companies — as proof that it took decisions that went against U.S. interests. This was something “members like Amazon, Google and Microsoft didn’t like at all,” yet it happened. WHERE NOW As leaders prepare to meet at the high-profile summit in Berlin to debate how far to go in pivoting away from Big Tech, several of the people interviewed for this piece cautioned against repeating past mistakes. While European countries have not yet aligned on a common definition of digital sovereignty — something many see as crucial for real progress — there are signs that Paris and Germany are closer on positioning than they were five years ago. “I admit, I struggled with the term [digital sovereignty] before. I didn’t think it was necessary, but the global situation has changed so dramatically that we Europeans now have to become more sovereign,” German Chancellor Friedrich Merz said Thursday. At the summit, Merz said, “We’ll explore all the possibilities, together with industry representatives, of what we can do not only to become more independent from China, but also, for example, less dependent on the U.S., less dependent on the Big Tech companies. We want to catch up, we want to improve.” Friedrich Merz said, “We’ll explore all the possibilities, together with industry representatives, of what we can do not only to become more independent from China, but also, for example, less dependent on the U.S.” | Harald Tittel/Getty Images And yet — with Germany this month celebrating Google’s decision to invest more than €5 billion in building data centers in the country, a move that Finance Minister Lars Klingbeil described as “exactly what we need right now” — the reality of corporate interests may be hard to address. For Bonfiglio, the lesson from Gaia-X is that ”it is obvious that everybody sitting in the boardroom of an association with such a big and impactful objective tries to protect the interests of their own company.” While Gaia-X may have missed its shot at delivering on its big, original ambitions, Lechelle insists the upcoming Franco-German summit is “a chance to put a finger on the sore spots.” In the meantime, “those who wanted to maintain the status quo have won.”