Transition Finance Weekly - July 2, 2026
Bye Bye Agency Independence; Duke’s Rate Hike Negotiation; CA Transit Faces Budget Gauntlet
BREAKING
Virginia is officially back in RGGI, the Regional Greenhouse Gas Initiative. With this move, Virginia polluters are once again having to account for and reduce their pollution. The program will also deliver funding for flood protection, energy efficiency, and power bill rebates.
1. The Supreme Court Rules Independent Agencies Now Serve at the Pleasure of the President
In a 6-3 ruling Monday, the Supreme Court struck down 91 years of precedent protecting independent agency boards from political removal. Among those on the line: FERC and the SEC.
In Trump v. Slaughter, the Supreme Court’s conservative majority overturned the 1935 precedent that prevented presidents from removing the leadership of independent agencies (except the Fed) without cause. The ruling confirmed that Trump’s firing of FTC Commissioner Rebecca Slaughter was lawful, and in doing so, effectively made every independent agency board member fireable by the president at will.
The implications for FERC — specifically structured during the 1970s energy crisis to be insulated from political pressures felt by the president — are direct and severe. As Joel Eisen, a law professor at the University of Richmond, put it, there is “no longer any legal doctrine stopping a president from removing any member of FERC if it were to do anything with which that president disagreed.”
Independence matters for climate financial regulation too. The SEC’s board — already hamstrung with only 3 of 5 commissioners seated as Trump has refused to appoint the required minority party representatives — is also subject to Slaughter, further putting at risk independent expert assessments of the urgency of climate risk, emissions, and other material disclosures.
2. CARB Delays Emissions Reporting Deadline
Companies have a three-month reprieve as California’s landmark corporate disclosure law gets delayed.
The California Air Resources Board pushed back the first reporting deadline under SB 253, the Climate Corporate Data Accountability Act, from August 10 to November 10. The delay is procedural: CARB withdrew its initial regulation from the state’s Office of Administrative Law to make targeted clarifying changes, and the three-month extension gives covered companies a clearer view of the final requirements before their inaugural reports are due.
The substance of the law is unchanged. SB 253 requires U.S.-based companies with over $1 billion in annual revenue doing business in California to publicly disclose their greenhouse gas emissions. The companion law, SB 261, which requires climate-related financial risk disclosures, remains under a Ninth Circuit injunction, though more than 170 companies have voluntarily submitted reports anyway.
California is the world’s fifth-largest economy and understands that emissions represent a material risk for companies as the ongoing and inevitable energy transition moves forward. The California framework is filling a vacuum that the federal government created and is actively widening in order to provide transparent, decision-useful information to investors, regulators and the public.
3. Duke Energy Cuts Its Rate Request, But Negotiations Take a Familiar Turn
After public pressure, Duke reduced its proposed residential rate increase from 18% to 11.6%, replicating a familiar pattern in the high-stakes game of rate negotiations.
Duke Energy announced it is reducing its proposed residential rate increase in North Carolina from 18% to 11.6% after pushback from state officials. The 11.6% figure is worth sitting with. With inflation running high — approximately 9% since Duke’s last rate increase in 2023 — any rate increase above inflation is asking ratepayers to absorb costs that exceed general price increase.
The research on utility rate cases is instructive here: studies have found that the “meet in the middle” strategy consistently favors utilities over ratepayers, because it incentivizes utilities to ask for more than they need. That dynamic helps explain why independent, knowledgeable regulators matter: it changes the negotiating geometry, rather than just trying to settle in the middle of a gamified range.
Also on regulators’ desks: the cost and type of energy generation utilities are procuring. According to a Southern Alliance for Clean Energy report this week, Duke recently projected less near-term solar procurement than previously planned, withdrew two customer solar programs in the Carolinas, and had its 2026 solar RFP paused by the North Carolina Utilities Commission chairman. Duke is raising rates while saying no to the most economical and quickest-to-deploy sources of power, opening their hand for more when they aren’t delivering the best value for consumers.
State Senator Michael Garrett of Guilford County framed the issue starkly:
“Is the profit Duke Energy earns actually fair to the people of North Carolina?” [...] Because our system should answer to the family at the kitchen table, not the shareholder watching the dividend. Duke’s investors are not the ones choosing between prescriptions and groceries.”
4. Rhode Island’s Legislative Session Ends With One Resilience Win and Several Near-Misses
Strengthen Rhody Homes passes. A suite of bolder climate and insurance bills did not.
Rhode Island’s 2026 legislative session closed with a notable step forward for climate resilience: H7865, creating the “Strengthen Rhody Homes” program, was signed into law. The program, currently unfunded, creates the structures needed to help homeowners harden their properties against climate hazards like hurricanes and high winds, joining a small but growing list of successful state-level fortification programs. The state can now pursue Federal grants to support the program. Given Rhode Island’s 400 miles of coastline and documented exposure to storm surge, coastal flooding, and extreme precipitation, the program is timely.
The session ended without passing a trio of more ambitious proposals. H7752 would have allowed people, companies, municipalities, and insurers to pursue damages from fossil fuel companies who engaged in deception for climate-related damages.The Rhode Island Insurance Market Protection Act (H8219/S2646), would have required insurers in the state to phase out their underwriting and investing in fossil fuels, and created a mechanism to manage the exit of insurers that withdraw from the market. And a third proposal (H7340) contained a resolution to encourage insurers to pursue subrogation against companies who lied about climate impacts and their contributions. It was put aside for further study. None of the three passed.
That insurance, resilience, and fossil fuels were a focus of Rhode Island’s legislative agenda should be no surprise. Rhode Island Senator Sheldon Whitehouse has been leading nationally on making the connection between climate change and insurance costs. This month, he proposed a Senate resolution making that link explicit.
Whitehouse’s floor testimony summed up why we can’t stop talking about insurance: “The bottom line is climate risk has moved from the science department to the economics department and it has landed hard in home insurance.”
5. California Transit Fighting for Funding
Newsom’s latest budget excluded $690 million in emergency funding for public transit agencies — money promised in a 2023 deal. Simultaneously, CARB rule changes mark a $600 million giveaway to the oil industry.
California climate and transit advocates are pressing state lawmakers to protect roughly $600 million in transit dollars generated by the state’s cap-and-invest program while Newsom’s budget shortchanges public transit agencies an additional promised $690 million.
There is irony in the cap-and-invest risk: The threat comes from CARB’s own recent rule changes, which created a new Manufacturing Decarbonization Incentive (MDI) program that would give free allowances to polluting industries in exchange for untested decarbonization investments. Analysts estimate this move could reduce Greenhouse Gas Reduction Fund (GGRF) revenues by $2.3 billion over the next several years. CARB’s MDI effectively props up oil refineries with free allowances — cutting funding for solutions, like transit, while investing in the problem.
California’s public transit agencies are already navigating fiscal cliffs created by post-pandemic ridership changes and the expiration of federal relief funding, and the potential loss of GGRF support compounds an already precarious situation. In the Bay Area, initiatives on the ballot this fall hope to save SF Muni, BART, and the regional transit network from collapse.
The broader irony is that public transit does enormous emissions-reduction work on a shoestring budget (LA Metro reached its highest ridership since COVID last month!) and these are exactly the programs that should be getting more resources as California tries to decarbonize transportation, not fewer.