Transition Finance Weekly - June 4, 2026
SEC Climate Rule; Election Results; CARB's Regression
1. SEC Moves To Withdraw Biden-Era Climate Disclosure Rule
The Trump-aligned SEC is formally withdrawing a rule that would’ve required companies to report on material climate-related risks and carbon pollution.
Last week, the Securities and Exchange Commission proposed a rescission of the agency’s own Biden-era Climate-Related Disclosure Rules, a first step in formally removing the rule. In February 2025, the Trump-aligned acting chair of the SEC directed the agency to stop defending the rules from challenges in court.
The rules, which were adopted by Chair Gary Gensler in 2024, required companies to disclose climate-related risks to their business, how they plan to adapt to climate change, and Scope 1 and 2 emissions for certain filers.
Despite the administration’s efforts, eliminating reporting of certain risks doesn’t change reality: climate change continues to unfold and pose significant risks to the financial system, whether the SEC is collecting data or not.
Still, it’s yet another area in which the federal government is stepping back and ceding ground: climate disclosure will continue to move on, just under the purview of different jurisdictions, including in California and abroad.
Heather Palmer, a partner at law firm Sidley Austin: “Even with the S.E.C. rule being rescinded, there are other disclosure requirements that are likely going to apply to public companies.”
2. Primary Elections in Six States Clarify the November Map, with Key Results in California Awaiting Finalization
As of Thursday morning, the California Governor’s top-two primary race is led by Democrat Xavier Becerra and Republican Steve Hilton, but a narrow path remains for climate philanthropist Tom Steyer to make the ballot.
On Tuesday, California was one of six states to hold primary elections ahead of the 2026 Midterms. California voters chose the candidates in hundreds of races including the gubernatorial race and insurance commissioner’s race, both critical elections for climate and clean energy policy.
With many mail-in ballots still to arrive, former HHS Secretary Xavier Becerra and Trump-endorsed Steve Hilton lead in the Governor’s race, while Senator Ben Allen and former San Francisco Supervisor Jane Kim lead the top two spots for Insurance Commissioner. In both races, results are far from confirmed.
A pathway remains for climate philanthropist Tom Steyer in the Governor’s race, though remaining ballots will need to be far more Democratic than early results. Climate and clean energy groups backed Steyer, who criticized Becerra’s ties to major oil companies and utilities.
Elsewhere, former Interior Secretary Deb Haaland became the Democratic nominee for Governor in New Mexico, making the climate hawk the likely next Governor of New Mexico. In Iowa, it appears as though Democrats will give Republicans tougher races for Governor after a more extreme candidate in the Republican Governor’s primary beat out Trump and party-backed candidate Randy Feenstra.
3. CARB Doles Out Giveaways to Refineries in Cap-And-Invest Update
California’s primary air regulator gives a major financial and compliance gift to refineries in a walkback of the Golden State’s climate ambition.
Last Friday in a divisive vote, the California Air Resources Board voted to finalize major changes to cap-and-invest, California’s carbon trading program, with a plan to allow oil refiners and other major polluters to receive allowances equivalent to 118 million tons of carbon pollution. CARB’s more robust original proposal in January – designed to help the state make up a gap in mandated emissions reductions by decreasing available allowances – received pushback from oil companies, which threatened to close their in-state refineries.
The new “manufacturing decarbonization incentive” allowances could be worth up to an eye-popping $4 billion and represent a significant share of a critical revenue-raising and carbon-pricing tool in California’s arsenal. With lower expected revenues, this move reduces funding for critical climate programs, including wildfire mitigation, affordable housing, and high-speed rail.
While framed otherwise, this is a significant weakening of climate ambition by California, which has been the face of climate ambition as the second Trump Administration targeted climate policies. CARB’s rule change will lead to lower carbon prices and more pollution.
4. Illinois’s Legislative Session Ends With Movement on Insurance
As the climate-driven insurance crisis creates affordability concerns, Illinois advanced modest proposals.
As its legislature wrapped up last week, the Illinois General Assembly passed multiple bills intending to alleviate the burdens of the growing insurance crisis in the state. Lawmakers passed SB714 and HB4273, two bills to give the Department of Insurance more oversight over “unfair” rates. They also passed SB4006, which tries to increase participation in climate-related data collection by insurers.
Still, the bills are just a starting point, falling short of the full ambition of Illinois Governor J.B. Pritzker’s aggressive push in 2025 to increase Department of Insurance oversight over rate requests, not just those deemed unfair or excessive.
Meanwhile, SB4006 was significantly amended before passage to remove critical risk reduction measures, including a program called the Strengthen Illinois Homes Program to fund property-level mitigation. The bill would have also required insurers to reflect mitigation measures with bill credits or rate reductions.
5. Arizona Adds Massive Batteries
Arizona now ranks second in the country for new battery additions so far in 2026, as it accelerates clean energy deployment.
Arizona is now a national leader in utility-scale battery storage capacity. So far in 2026, Arizona has added 940 MWh of battery storage, putting it second in the country behind Texas (2,696 MWh) and slightly ahead of California (936 MWh) in new battery capacity additions.
In 2025, Arizona became the third-largest state for deployed battery storage systems and its new 2026 additions now bring it to more than 20 GWh of battery storage, behind California (60.6 GWh) and Texas (29.2 GWh) in total installed battery capacity.
Despite the administration’s unrelenting attacks on renewables, clean energy continues to be deployed at scale, especially alongside batteries. Batteries are also making other forms of clean energy, especially solar, more attractive to grid planners, utilities, and energy planners.
Pleiades’ Take: Batteries give us hope! Tell your friends.
SPOTLIGHT: Insurance Crisis Squeezes Homeowners
A new study from the Urban Institute finds that climate-driven insurance risks are increasingly burdening homeowners and putting homeownership further out of reach for Americans. The report found that insurance costs are accounting for a growing share of the costs of homeownership, rising from 1.87% as a share of income in 2018 to 2.27% in 2024. Importantly, the report also notes a growing share of high-burden premiums, finding that 16.2% of new mortgages in 2024 had premiums exceeding 3% of income, compared to just 10.5% in 2018.
Individuals in high-hazard areas face burdens significantly higher than those in low-risk areas, a gap that has accelerated since 2018. Importantly, though, these discrepancies aren’t limited to differences in risk across geographies: those with the highest existing financial burdens, like lower incomes, credit scores, and high-debt-to-income ratios, are more likely than others to be significantly burdened by insurance.
