Transition Finance Weekly - 10/3/2025
Gov Shutdown Threatens NFIP, DOE Quietly Bans “Climate Change,” Xcel On the Hook for $640M in Wildfire Claims
Exploring the policy, politics, and economics of the clean energy transition
Each week here in Transition Finance Weekly, researchers and analysts from Pleiades Strategy summarize the top stories and trends related to the policy, politics, and economics of the clean energy transition in the states.
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1. 4,000+ Companies on California’s List
The Golden State moves forward to ensure corporate climate transparency.
California regulators released a preliminary list of more than 4,000 companies that will be subject to the state’s new climate disclosure laws, the strongest in the nation. Companies will be required to report climate-related risks and greenhouse gas emissions, including (for larger firms) their Scope 3 emissions. Enforcement will be led by the powerful California Air Resources Board.
While the EPA moves to dismantle federal emissions tracking regulations and reverse climate finance disclosure rules, California is pushing in the opposite direction: toward accountability and transparency. And with an economy larger than Japan’s or the U.K.’s, California has the financial heft to shape markets.
2. Flood Insurance and Disaster Relief in Jeopardy as Government Shuts Down
As GOP brinkmanship escalates, critical protections and disaster response (and lots of other things) are on the line.
The federal government shut down at 12:01 AM on Wednesday morning when Congress failed to pass the required spending authorization bills. In addition to suspending normal government operations until the legislative standoff is resolved, it also puts some programs in serious jeopardy. The National Flood Insurance Program (NFIP) expired on Tuesday and has not been reauthorized, putting mortgages that require NFIP coverage on hold and leaving millions of homeowners in limbo.
FEMA’s $10 billion disaster relief fund is also at risk of being depleted, with no guarantee of replenishment during a government shutdown. The GOP has already been playing politics with disaster aid: the administration attempted to redirect FEMA dollars away from Democratic-led states, but a Trump-appointed judge blocked the move this week.
Disaster relief can’t be a bargaining chip. With climate shocks intensifying, Congress needs to reassert its power of the purse and guarantee the core government services Americans rely on. The cost of partisan obstruction will be measured in delayed relief, stalled rebuilding, stranded families, and abandoned communities.
“The main concern is whether buyers will have coverage if a flood occurs and whether FEMA will have sufficient funds to pay claims,” said Austin Perez, senior policy representative for insurance Issues at the National Association of Realtors (NAR).
3. DOE Quietly Bans Science Words Like “Climate Change”
Another week, another attack on reality.
The Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE) has issued new internal guidance instructing staff to stop using words like “climate change,” “emissions,” and even “green.” The directive, which came from a political appointee, warns that these terms are now “misaligned with the Administration’s perspectives and priorities.”
The memo adds to a growing list of federal efforts to downplay or erase references to science and clean energy innovation. It’s part of a broader pattern of pressure on public employees to avoid even acknowledging the climate crisis, let alone promoting clean energy technologies, all in an effort to protect political allies in the fossil fuel industry.
“This will not only affect research and policy directly, it will also affect what we see and don’t see and what we say and don’t say. The state has this power in virtue of its legitimate and cognitive authority,” said Rakesh Bhandari, associate director of interdisciplinary studies at the University of California, Berkeley. “Note that the Democrats are pretty silent about what matters most to the GOP: The protection of fossil fuels.”
4. Texas Is Subsidizing $1B Fossil Gas Plant With a $562M Low-Interest Loan
State lawmakers keep throwing today’s money at yesterday’s tech.
Texas energy regulators approved a third low-interest loan from the Texas Energy Fund, this one $562 million for a new $936 million natural gas plant run by NRG Energy. That’s on top of another $216 million NRG got in August for a different gas project in Houston.
The Texas Energy Fund, as we have covered, is a giveaway to polluting gas generators in the name of reliability — yet it was gas system failures that put Texans at risks during Winter Storm Uri. Plus, fair economics are driving renewables in a different direction: in 2024, 95% of new US capacity additions were from renewables or storage.
5. Xcel Energy Will Pay $640M for Deadly Colorado Wildfire
Utility liability in the age of climate-driven disasters keeps growing.
Xcel Energy has agreed to pay $640 million to settle lawsuits related to the 2021 Marshall Fire, the most destructive wildfire in Colorado history. The blaze killed two people, destroyed nearly 1,000 homes, and caused billions in damage. About half of the settlement will be covered by the company’s insurers.
As climate risk grows, the cost of inaction is being tallied in courtrooms and settlements. Utilities across the country are increasingly on the hook for wildfire damage linked to failing or underprovisioned infrastructure, including California’s PG&E and Southern California Edison (which is facing two new federal lawsuits this month).
Hardening can’t just mean trimming trees. Utilities need to rethink their entire resilience model, incorporating distributed energy resources (DERs), microgrids, and redundancy to make power lines in high-risk zones obsolete.