Global warming has led to the melting of the polar ice caps. Sea levels have risen dramatically, with devastating effects. Survivors Richard and Amy Webber of environmental pressure group Greenwatch are teaching children the skills they will need to help restore the damaged planet.

Richard and Amy are arrested in a Commission raid on the school, leaving their own children, Greg and Karen, to fend for themselves. They join Ash and Mai-Li to find Goodman, an old associate of the Webbers, at his laboratory within a derelict mill. Goodman recounts the history of Greenwatch, explaining how its outlawed scientists have been blamed for causing the disaster they had tried to prevent, and the children return to the school for medicine to treat his illness.

At the Commission Headquarters, telepath agent Kurt Glemser interrogates the imprisoned Amy Webber in a malevolent attempt to locate and arrest the missing telepathic children, who he refers to as 'senders'. Amy tries to send a warning message to Mai-Li through her own telekinesis abilities, but she is too late; eventually realising that herself and Ash are in imminent danger, Mai-Li is then faced with altering Goodman's memories before Glemser forces him to betray her.

Joshua, a young 'sender' who has been arrested by The Commission, appears to go missing while under their authorised escort transference. Now a fugitive seemingly looking for help from the children, it is eventually revealed that the boy and the Greenwatch personal computer have been programmed with a life-threatening psychic virus by Dr. Galina Renkova, developed by him with malicious intent to make the telepaths progressively attack and destroy one another.

Greg takes a bored Mai-Li and Ash on a boat tour around the nearby islands to avoid staying cooped up indoors. They subsequently receive a morse code message from Paradise Island. Heading there, they discover and attempt to help old island resident Hepzibah McKinley, a scientist who claims to have discovered the secret of cold fusion, and is continuing her father's incomplete research into the subject to try and create greater sources of energy for the remnants of the world.