Transition Finance Weekly - 6/26/2025
Renewables and National Security; Heat Stresses the Grids; Solar Advances in IN, MI, and IL
SPOTLIGHT: The National Security Case for Renewables
Clean energy isn’t just a climate or economic issue — it’s a national security imperative.
We’ve known it since the 1970s: overreliance on fossil fuels makes the U.S. vulnerable, and recent oil market volatility provides the latest evidence. After the strikes on Iran and amid heightened tensions in the Strait of Hormuz, oil prices surged, with ramifications across the market.
Global fuel geopolitics put family budgets in the crosshairs: renewable energy can free communities from global price volatility by providing steady electrons without the need to purchase fuel to burn, protecting households from price shocks.
Also worth the investment? Upgrades to the grid to ensure reliability and resiliency to cyberattacks, extreme weather, and other threats.
Frances Sawyer’s take: “True energy independence comes from robust investments, like those in the Inflation Reduction Act, into our energy supply chains, infrastructure, efficiency, and generation. Renewables are a pathway to cleaner air and water, cheaper electricity, and a hedge against the volatility of global fossil fuel supplies.”
1. Have You Been Outside This Week? Yikes.
More than 100 million Americans grapple with extreme heat.
A heat dome has locked in sweltering temperatures across a large swath of the U.S., shattering temperature and humidity records and making daily life miserable. For many, “miserable” doesn’t cover it: for the elderly, those without air conditioning, and people who work outdoors, the official guidance to stay inside may not be enough to keep them safe.
This is especially true of people who work outdoors, many with minimal protections or none at all. Right now only five states have laws requiring employers to provide heat protections, and some states like Florida and Texas ban such protections outright. And the federal heat safety rule finalized last year in an attempt to plug that safety gap is now on the Trump administration’s chopping block.
Extreme heat is one of the most deadly results of climate change — in New York City alone, hundreds of people die due to extreme heat — and every year, the consequences grow more dire. There are ways to adapt how we live, and some cities like Phoenix are taking aggressive action. But in most of the country, state and local governments have kicked the problem down the road to next year.able life.”
2. Extreme Heat Tests the Grid
Clean energy grids can take the heat (literally).
On Tuesday afternoon, at the hottest point of the hottest day so far this year, New York State’s grid operator issued an Energy Warning, an extremely rare alert that the stability of the power system could be at risk. Conditions had improved to Energy Watch levels by yesterday morning, but supply is still tight, and New Yorkers are hoping they don’t get hit by the kind of disruptions extreme weather has wrought on Texas in recent years.
Fortunately, in the current heat wave, Texas’s energy grid is holding steady: ERCOT’s blackout risk has dropped to just 0.3% this year. The improvement is thanks to 87 new energy projects that added 13.5GW of power generation — with 95% of that new capacity coming from solar and wind generation and better batteries that operate reliably even during spikes in demand.
Texans aren’t seeing the price spike they have seen in past weather events, with solar buildout reducing wholesale energy prices by 50% — a relief after last year’s 1600% energy price surge. Compared to PJM in the Northeast and MISO in the Midwest, which have far less battery capacity and prices up to 9X higher, Texas is showing that clean energy can take the heat, and still deliver.
3. New York Needs More Battery Capacity
Simpler interconnection would help.
New York State has seen scattered brownouts this week — much to the dismay of the miserable millions baking under the heat dome — and it’s lagging in adding battery storage that would help. Right now, the state has only 445 MW of battery capacity connected to the grid, and that pales in comparison to states like Texas and California, each adding more battery capacity this year than New York has in total.
What’s holding New York back? Interconnection. While Texas’s ERCOT allows fast and relatively cheap interconnection, batteries in New York face steep delays and siting challenges, especially in densely populated areas.
To ramp up battery capacity, New York needs to streamline its interconnection and permitting process. For renewables and battery projects, most of the costs are upfront, and every delay raises those costs, making some investors balk at adding more renewable capacity in places that need it.
Adam Cohen, a founder at Brooklyn-based NineDot Energy: “It doesn’t take years to physically build the project. It just takes years to develop it because of all the checkpoints. . .You can’t just make it happen.”
4. Texas Approves Climate Adaptation Measures
Texas leaders move to protect water.
As droughts strain water supplies, Governor Greg Abbott is expected to sign legislation putting a $1 billion-per-year Texas Water Fund on the ballot in November. It would underwrite new water sources, flood mitigation, conservation, and long-overdue infrastructure repairs, all made more urgent by climate change.
The Texas legislature approved the measure amidst a legislative session centered around divisive debates on bills aimed at restricting renewable energy. The worst of those bills failed to pass, but contentious conversations proved that many Texas leaders flat out refuse to acknowledge climate change as a key driver of continued water and infrastructure worries in the Lone Star State.
Even if voters approve the Fund, though, those billions are just a first step. Texas faces an estimated $154 billion water infrastructure gap over the next 50 years, with current funding sources projected to cover less than a third of that.
Perry Fowler, executive director of the Texas Water Infrastructure Network: “There is a sense of urgency to get this done…We can’t afford not to do it now, because in 20 years, we’re going to have communities that are out of water, and we’re going to lose those driving engines of the Texas economy.”
5. Even Amidst Federal Rollbacks, Solar Succeeds
In three Great Lakes states, solar is getting hot.
Indiana: Bila Solar has begun producing solar panels at its new Indianapolis facility, and that’s good news for our domestic solar supply chain as global energy markets grow more unstable.
Michigan: Taking advantage of a 2023 law intended to bypass opposition to clean energy projects, last week, the developers of a proposed 873-acre solar farm near Lansing filed directly for approval with the Michigan Public Service Commission, leapfrogging local review.
Illinois: Workforce hubs are up and running, thanks to the 2021 state-funded Climate and Equitable Jobs Act. Eleven hubs are training hundreds of people, many from marginalized communities, for careers in solar energy and other renewable fields. With 541 students enrolled and 94 graduates so far, this is a model of how states can and should build equity and opportunity into the energy transition.
Trainee Jordan Foley on the Illinois workforce program: “It’s changed my life.”
6. Bribery and Corruption in Ohio
How backroom deals stymied renewable development.
This month, Ohio’s Public Utilities Commission finally began hearings into FirstEnergy’s role in passing HB 6 six years ago, a law that bailed out a number of power generating facilities and included incentives for coal power plants.
But first, FirstEnergy had to answer to federal prosecutors for bribing lawmakers. The utility has admitted to funneling $60 million through dark-money groups to secure the support of then-Speaker Larry Householder, who’s now in prison. The company also admitted to paying $4.3 million to Sam Randazzo, former chair of the state utilities commission, just before he took office in exchange for favorable treatment.
Now, the PUC is weighing three cases about whether FirstEnergy illegally used more than $450 million in ratepayer funds, whether it hid unlawful side deals, and whether it allowed its regulated companies to collude to pass the law. And a fourth case, not part of the hearings, could reveal whether customer dollars were used for political donations.
John Seryak, CEO of energy consulting firm RunnerStone: “Corrupting the regulatory process in such an appalling manner cuts to the core of our functioning democracy in Ohio.”