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Since the late 1800s, the grid has used more or less the same devices to convert electricity to different voltages. They’re called transformers — and they’re in increasingly short supply as power demand surges nationwide.
A crop of startups wants to solve that problem and modernize transformer technology at the same time — and they’re raising financing to do it.
On Wednesday, solid-state transformer startup Heron Power closed a $140 million Series B round from investors including Andreessen Horowitz’s American Dynamism Fund and Breakthrough Energy Ventures.
The new financing will allow the Northern California–based startup to build a factory at a yet-to-be-disclosed U.S. location capable of churning out 40 gigawatts of its medium-voltage power-conversion gear annually. It plans to start full-scale production in the second half of 2027 and have hundreds of megawatts of equipment produced by the end of that year.
Heron Power has already lined up 50 gigawatts of orders with more than a dozen prospective customers that are “actively engaged in technical product collaborations,” according to CEO Drew Baglino, who founded the startup in 2025 after an 18-year career at Tesla.
The firm is looking to initially sell not to utilities but rather to operators of solar and battery farms and data center campuses, which need to convert electricity as well. So far, it has disclosed only two of its early customers: Intersect Power, a major clean-energy developer that Google is acquiring for $4.75 billion, and Crusoe, a data center developer building a 1.2-gigawatt campus in Abilene, Texas.
While Baglino declined to share details about other prospective customers, he did say that Heron Power has been bringing many of them into its lab to see the prototype equipment being put through its paces. “We’re also doing integrated full-system deployments later this year,” he said. “It helps immensely for folks to get a sense of what we’re talking about and see the power processing in front of them.”
Heron Power isn’t the only company building next-generation power-conversion equipment. DG Matrix is planning to deploy its solid-state transformer via strategic partnerships with PowerSecure, a major developer of microgrids and data-center power systems that’s owned by utility Southern Co., and with Exowatt, a startup providing solar and thermal energy storage systems to data centers.
On Wednesday, the Raleigh, North Carolina–based DG Matrix announced a $60 million investment led by Engine Ventures and including Mitsubishi Heavy Industries and electrical-equipment manufacturing giant ABB. The Series A funding will enable the company to scale up manufacturing and deepen “strategic partnerships with datacenter developers, hyperscalers, utilities, and industrial customers,” according to the company’s press release.
Another startup in the space, Resilient Power, was acquired last year by electrical equipment giant Eaton in a deal worth as much as $150 million.
Solid-state transformers digitally manipulate the flow of electricity, employing the same kind of power electronics that are used in solar and battery inverters and in electric vehicle drivetrains. “Solid state” refers to the semiconductors that make that digital power manipulation possible. “Transformers” is a nod to the 19th-century electromechanical devices that convert the voltage of alternating current via copper wires wound around iron cores.
Solid-state transformers are a timely replacement for those devices for a couple of reasons. They’re far more flexible than old-school electromagnetic devices, meaning engineers can do more things with one device. They’re also urgently needed because conventional power equipment — particularly transformers — has been unable to keep up with the demand created by the fast-growing electricity sector.
The technology itself is not brand new. High-frequency digital power-switching technologies are already used for specialized purposes such as massive high-voltage direct current (HVDC) converters. And inverters — another form of digital power-switching tech — are an integral part of EV chargers and solar and battery installations.
Over the past decade or more, various efforts to expand the role of solid-state power-conversion technologies to replace a wider array of systems have struggled to gain traction, given high costs and technical challenges. But Heron Power’s Baglino thinks that the time is right for this tech, as costs come down and major customers seek out effective alternatives to the backlogged and increasingly expensive conventional options.
As with many other digital technologies, “power semiconductors have had their own version of Moore’s law,” Baglino said. In the past five years or so, these improvements have made it “not only feasible but economically attractive to replace inverter skids — with an old-school transformer at solar and battery facilities — with a power electronics solution.”
Those “inverter skids” he mentioned are shipping-container-size combinations of electrical gear — step-down and step-up transformers, switching and protection gear, and inverters themselves — that convert direct current from solar panels and batteries to grid-ready alternating current. Similar combinations of gear are used to convert grid electricity to direct current needed to power heftier commercial and industrial sites — such as data centers.
Unlike traditional high-efficiency transformers, solid-state power-conversion devices don’t need specialized grain-oriented electrical steel, which is now in short supply. Instead, they use the same silicon carbide and gallium arsenide semiconductor supply chains feeding EV markets, Baglino said, “and the EV supply chain has expanded rapidly over the past decade or so.”
Solid-state transformers also weigh less and take up less space than the gear they replace, he said. They’re capable of a wider range of functions, including regulating power quality fluctuations, which can wreak havoc on data centers, and they can be used for multiple applications, unlike traditional equipment.
As for the cost, Baglino said prices for Heron Power’s electronics are competitive with those for traditional tech. “We’re not asking for any premium over the solutions they’re buying right now.”
Like DG Matrix and Resilient Power, Heron Power is targeting data centers, solar and battery farms, and dense EV charging sites for early adoption, since that’s a “fast-growing market with motivated customers,” Baglino said.
Heron Power’s Heron Link devices are designed to handle typical utility distribution substation voltages of 34.5 kilovolts and to deliver 600-volt direct current. That higher-than-typical voltage aligns with the latest data center power architectures being pursued by major AI players such as Nvidia.
“But we have every intention of bringing the benefits of solid-state transformers to the AC-to-AC world,” he said, referring to the need for transformers to step voltage up and down without converting it to direct current. “A single SST can decouple faults, it can do power factor control, it can do voltage regulation, frequency regulation, all this monitoring and control of the power flow that utilities don’t have with passive transformers.”
While these are all useful capabilities, utilities are not eager adopters of novel technologies. Over the previous decade, companies that have built power electronics for utility distribution grids have closed up shop or have been acquired and fallen from public view.
But the combination of technical improvements and growing grid pressures may make this decade different. “Once we prove the technology is performing well” for solar farms and data centers, Baglino said, “we can go back to utilities.”
Before temperatures plunged to the teens in the wee hours of Feb. 2 in North Carolina, Duke Energy pleaded with customers like me to conserve.
Since electricity supplies would be strained, the utility said in a blanket email, we could help avoid planned blackouts by lowering our thermostats and perhaps putting on a sweater. I got a text, too, asking me to cut back on “nonessential energy use.” In other words: Embrace my inner Jimmy Carter.
The missives worked, in that Duke didn’t have to schedule outages around the state, but they also provoked resentment. At public hearings, some complained that large customers like data centers probably didn’t get the same appeal. On social media, I saw at least one energy policy wonk contend that the utility should be paying customers — not just asking them nicely — to reduce their energy use.
But it turns out that Duke also does that. I should know: Late last year, I joined the throng of Tar Heels who let the company remotely adjust our smart thermostats by a few degrees when needed in exchange for a credit on our bills. It’s just one example of the sort of demand-response program that clean energy advocates say should be expanded not just in North Carolina but also nationwide, as climate change leads to more frequent extreme weather that taxes electricity supplies.
While broad solicitations like the one I received on Feb. 1 can help relieve stress on the grid when every watt counts, paying customers to enroll in ongoing programs can have a more substantial effect. Plus, they offer some much-needed utility-bill relief for households dealing with skyrocketing energy costs in North Carolina and beyond.
A version of the incentive program I participate in has been around for nearly two decades, after a 2007 law required Duke to invest more in energy efficiency. Long an option in the summer for those with central air conditioning, the scheme was recently extended into the winter. Around 500,000 customers are enrolled in the warm months, Duke says, and some 66,000 are signed up in the cold months. (Participation is lower in the winter partly because many customers heat their homes with gas rather than electricity, per the utility.)
Duke hasn’t yet analyzed the precise effectiveness of this one residential incentive program during this year’s unusually frigid temperatures. But it says the combination of this household initiative, similar ones for business customers, and the mass conservation request all made a difference.
“The collective efforts of customers in our demand response programs and those who voluntarily reduced their energy use made a substantial impact during the stretch of extreme cold and unusually high energy demand,” spokesperson Jeff Brooks said in an email. “Across our Carolinas service areas, customers helped reduce demand on the grid by contributing hundreds of megawatts of electric load reduction.”
Hundreds of megawatts is no small matter. It’s the equivalent of the grid getting an additional small gas-fired power plant — but without the associated pollution or cost.
For consumers, there were clear upsides, too.
In Raleigh, where I live, the scheme is called EnergyWise. In other parts of Duke’s territory, it’s called Power Manager. Everywhere, the idea is the same: Customers with electric heat and thermostats connected to the internet get a $150 credit for enrolling, then $50 a year after that, plus whatever money we save by using a little less heat than we might otherwise. It’s not a staggering amount, but since the average Duke household in North Carolina spends about $154 a month on electricity, it’s not nothing, either.
For my part, the savings have been meaningful. I live in a small house powered partly by solar panels, so I’m not a prototypical Duke customer. But since joining the program in early December, I’ve paid the utility all of $6.45, thanks to the sign-up incentive. (My bill due in March, to be fair, is close to $130.) With Duke proposing rate increases of 15% in the coming years — and a 2025 law requiring households to shoulder more of the burden when the company buys power from outside the state — I’ll take the extra dollars where I can.
“Active savings events,” whereby Duke lowers my temperature setting a few degrees for one or two hours, happen a few times a month, per the company, or not at all if the weather is mild. A message on my physical thermostat, and on the phone app that controls it, tells me when an event is underway. I can opt out at any time by changing the temperature as I see fit.
A Gen Xer, I grew up in a household where only one person — my father, born in the throes of the Great Depression — could control the thermostat. His rule was kind but firm, with winter settings that never exceeded the high 60s. Sometimes he would cheerfully encourage an extra layer and start a fire. At night, he always set the temperature much lower.
Perhaps that upbringing, together with my career as an energy reporter, explain why I’ve felt the need to override a savings event only once so far. It wasn’t to raise the temperature but to lower it during the recent cold snap: I woke up in the middle of the night and realized I’d accidentally set the thermostat higher than normal. While Duke’s system had adjusted the heat down a few degrees, I wanted it to be colder still — a little bit for the planet, a little bit for bedtime coziness, but mostly for my wallet.
Of course, plenty of people will balk at giving Duke — a monopoly that almost by definition breeds distrust — control over their thermostats. And I can surely see how the entreaty for households to voluntarily conserve left a bitter taste when the company was reporting sky-high profits.
But I suspect there are scores of people like me, who are happy to do their part and save a little money at the same time with basically no risk. As for the half million North Carolinians already enrolled in the program, I know one thing for sure: They aren’t all energy reporters with solar panels.
A correction was made on Feb. 19, 2026: This story originally misstated the date of the Duke Energy email as Feb. 2; it came on Feb. 1.
Five years ago, Winter Storm Uri brought the Texas power grid to its knees. Temperatures plunged across the state for nearly a week, power plants froze, natural gas supply lines failed, and the grid operator came within minutes of a total system collapse. More than 4 million Texans lost electricity, many for days. Over 200 people died. It was the worst infrastructure failure in modern Texas history.
In the years since, Texas has quietly built one of the largest renewable energy and battery storage fleets in the world. According to capacity data from the Electric Reliability Council of Texas, the state has added roughly 31 gigawatts of solar capacity and 17 GW of battery energy storage — enough to power millions of homes. Over the same period, the legislature mandated weatherization of power plants and natural gas infrastructure, ERCOT improved its operational procedures, and new market mechanisms were introduced to better coordinate solar and storage.
The results speak for themselves. Since Uri, the Texas grid has faced three major winter storms that each set new all-time winter peak demand records. In every case, the grid held. No rolling blackouts. No load shedding. No emergency curtailments. Demand kept climbing, and the grid kept delivering.
This track record matters because a prominent Texas think tank, the Texas Public Policy Foundation, has published a widely circulated analysis arguing that ERCOT’s reliance on solar and battery storage is making the grid less reliable in winter. The analysis is authored by Brent Bennett and uses real ERCOT data. But as this article will show, Bennett’s own numbers contradict his conclusions — and the actual performance of the grid over the past five years contradicts them even more decisively.
The following chart I worked up offers a quick summary: Texas’ reliability has increased dramatically in recent years in direct proportion to the renewables and battery storage it has added.
The above data tells the story. At the time of Uri, ERCOT had roughly 5 GW of solar and less than 1 GW of battery storage. When Winter Storm Elliott arrived in December 2022, it had 14 GW of solar and 2 GW of storage. By Winter Storm Heather, in January 2024: 22 GW and 4 GW. By Winter Storm Kingston, in February 2025: 30 GW and 9 GW. And now, as we pass the fifth anniversary of Uri: approximately 35 GW of solar and 15 GW of battery storage.
During each of these storms, peak winter demand set a new record — climbing from 74,525 MW during Elliott to 78,349 MW during Heather to 80,525 MW during Kingston. Just three weeks ago, the grid sailed through another major winter storm with over 11,000 MW of operating reserves and ERCOT said it did “not anticipate any reliability issues on the statewide electric grid.”
In none of these events did ERCOT order load shedding. This is the track record that Bennett’s analysis asks you to ignore.
Now let’s turn to Bennett’s projected numbers for 2030. His Figure 1 posits that ERCOT could have 103,802 MW of firm output against a speculative peak demand of 110,000 MW — his estimate, not ERCOT’s. That’s a gap of roughly 6 GW. His projected battery fleet by 2030? Forty-three gigawatts.
Read that again: a 6-GW shortfall covered by 43 GW of batteries.
Bennett’s response to this rather obvious mismatch is to reframe the question entirely. Instead of asking whether batteries can cover peak demand windows — which is what they’re designed to do — he converts the entire battery fleet into a single energy metric: 77 GWh, which he says is “equivalent to running a single 1 GW thermal power plant for the duration of this three-day storm.” It’s a striking comparison. It’s also irrelevant to how batteries actually operate in ERCOT.
Nobody designs, operates, or dispatches battery storage as a 72-hour baseload resource. Batteries are designed to shave peaks, provide rapid frequency response, and bridge the morning and evening demand ramps when solar output is low. A 43-GW battery fleet can inject enormous amounts of power during exactly the narrow peak windows that Bennett’s own Figure 2 identifies as the problem periods. During Winter Storm Heather, ERCOT’s post-storm analysis confirmed that batteries were “partially supplementing the lack of solar generation available” during the coldest pre-sunrise hours — the exact scenario Bennett says they can’t handle.
Perhaps the most revealing aspect of Bennett’s analysis is what he doesn’t discuss: the massive existing fleet of gas, coal, and nuclear generation that forms ERCOT’s backbone. He projects 103,802 MW of firm winter output in 2030. That fleet — overwhelmingly fossil and nuclear — carries the grid through the vast majority of every storm hour in his model. The assumed thermal outage rate is only 12% — a figure drawn from ERCOT’s reliability assessments — meaning 88% of the thermal fleet performs through the modeled storm.
Bennett constructs a scenario in which batteries fail by defining success as continuous 72-hour discharge, while simultaneously taking for granted the thermal fleet of 80-plus GW that keeps the lights on during the bulk of his modeled event. The batteries aren’t replacing that fleet. They’re supplementing it during the peak demand windows that the thermal fleet alone can’t quite cover — which is precisely the role that ERCOT’s system planning envisions for them.
The contrast between Bennett’s theoretical model and actual ERCOT performance is stark. During Winter Storm Elliott, solar contributed roughly 8 GW at peak, and real-time prices dropped from over $3,000/MWh to under $100 within 90 minutes of sunrise. During Heather, large flexible loads curtailed voluntarily, demonstrating the demand-side response that Bennett barely acknowledges. ERCOT CEO Pablo Vegas has specifically identified the growth in battery capacity as “perhaps the most significant factor affecting grid stability,” while University of Texas energy professor Michael Webber credited “significant investments in more solar and more batteries and demand response” as key factors in the grid’s most recent winter storm performance.
None of these experts are claiming the grid faces zero risk. ERCOT’s probabilistic risk assessment, as reported in NERC’s winter reliability assessment, puts the chance of controlled load shed this winter at about 1.8% — low, but not zero. The question is whether Bennett’s framework for evaluating that risk is sound, and on that point, the data he himself relies on says no.
Bennett’s piece concludes that ERCOT needs “market design changes that redirect revenue away from wind and solar and toward resources that can work in all types of weather conditions.” That’s a policy preference dressed up as an engineering conclusion. His own data doesn’t support it.
What his data actually shows is that ERCOT has a manageable peak-demand gap that battery storage is well positioned to address, supplemented by a massive thermal fleet that provides the overwhelming majority of firm capacity during winter events. The December 2025 launch of ERCOT’s Real-Time Co-optimization Plus Batteries (RTC+B) market is specifically designed to optimize exactly this kind of coordination — dispatching storage where and when it creates the most grid value.
The real question isn’t whether batteries can run for 72 hours straight. No one is asking them to. The question is whether the combination of 100-plus GW of firm thermal capacity, a rapidly growing battery fleet, improving demand-response capabilities, and better weatherization standards can keep the lights on during winter storms. The last five years of actual performance — including three consecutive record-breaking winter peaks — provide a clear answer.
Bennett’s analysis works only if you accept his premise that battery storage should be evaluated as a baseload replacement rather than what it actually is: a fast-dispatching, peak-shaving complement to the thermal fleet, which helps dramatically in firming up renewables like wind and solar. Reject that premise, and his crisis narrative dissolves into the numbers he himself provides.
See more from Canary Media’s “Chart of the Week” column.
It’s official: Grid batteries broke another record.
More than 13 gigawatts of energy storage was installed across the U.S. last year, per a new report from the Business Council for Sustainable Energy and BloombergNEF. That’s up from the roughly 12 GW installed in 2024.
It’s the latest reminder of the meteoric rise of battery storage, a quick-to-deploy technology that’s key to cutting emissions from the electricity system. Storage enables the grid to bank electricity when it’s cheap and abundant — like when surplus solar is generated in the middle of a sunny day — and deploy it when prices are high and electrons are scarce.
Less than a decade ago, the sector was little more than an intriguing possibility. Energy storage in America mostly meant massive, decades-old pumped-hydro storage projects and a handful of small lithium-ion battery plants.
In 2017, only 500 megawatts of grid battery capacity was online in the U.S.; now, there are individual battery installations larger than 500 MW. Still, the sector had big expectations for itself back then: In 2017, the Energy Storage Association set a goal of reaching 35 GW of storage capacity by 2025.
Last year, the sector smashed that goal, hitting it in July and ending the year with nearly 45 GW of installed capacity.
Increasingly abundant solar power, rising energy demand, and declining battery costs have combined to propel the storage sector to these lofty heights. To date, most utility-scale batteries have been plugged into the grids of Texas and California, two solar-soaked states with radically different approaches to encouraging storage growth.
In the coming years, the storage sector has a smoother path to continued growth than do renewables.
Yes, it faces some challenges. Federal tax incentives are now contingent on compliance with strict but vague anti-China supply-chain rules. Developers also have to deal with tariffs and increasing local opposition.
But, unlike for solar and wind, tax credits for storage were spared in the One Big Beautiful Bill Act that President Donald Trump signed into law in July. Also unlike solar and wind, the battery industry has not yet attracted much explicit trash-talking from either Trump administration officials or Trump himself. Storage is also increasingly cheap and fast to build.
These facts, plus the urgent need for new sources of affordable energy as utility bills rise, have the storage industry poised for continued growth in the years to come.
Last Friday, U.S. Energy Secretary Chris Wright held a press conference to talk about how the power grid didn’t collapse during late January’s Winter Storm Fern.
Some of the things he said were true. Others weren’t. It’s important to know the difference — especially as the Trump administration routinely uses misleading statements to justify decisions that make the power system dirtier, more expensive, and ultimately less reliable.
Wright, a former fossil gas–industry executive who has overseen the administration’s hard turn against clean energy, praised the efforts of utility workers who rallied from across the country and worked around the clock to restore power to more than 1 million people after ice and falling trees took out grid lines. That’s true, and good.
But the centerpiece of Wright’s nearly hourlong presentation was a series of charts, propped up on an easel, that served as a launchpad for the same kind of half-truths and obfuscations that have typified his approach to the job.
His pie charts showed the mix of electricity generation at the peak of wintertime demand across the eastern U.S. and in New England. There was a lot of fossil gas, a big slice of coal and of nuclear, and, in New England, a lot of oil — a key source of emergency generation in wintertime. Meanwhile, wind and solar power, the resources Wright called the “darlings” of the climate movement, were represented by very small slices.
In Wright’s view, these charts tell a story of waste and excess. People had to pay for the construction of all that renewable energy, and the poles and wires required to carry it, only for that power to disappear when the grid needed it most.
Here’s how he put it: “If you can add reliable power at peak demand time, you’re additive to the grid. If you can’t, you’re just … a cost center. You’re not actually helpful for the grid.”
This is a gross oversimplification of the complex ways that different types of power add value to the grid. As Wright well knows, people don’t need electricity on just the hottest or coldest days. They need it every day, all 8,760 hours of the year. And how that power is generated on a daily basis matters just as much as how it gets produced in extreme circumstances — for people’s wallets, their health, and the planet.
The vast majority of the time, wind and solar — and energy storage — reliably provide electricity to the grid. During the first 10 months of 2025, the U.S. got nearly one-fifth of its electricity from these sources.
Why is that? Because the electricity that renewables provide is cheap and plentiful. Nowadays, it is often less expensive than gas-fired power. And renewables are certainly much cheaper than coal power, even as Wright’s Department of Energy has spent the last year propping up the dirty fossil fuel at great cost to consumers.
For the past two years, solar, wind, and storage have made up more than 90% of the new electricity capacity being added in the U.S. — and around the world. And we will need to keep up that pace for the U.S. to meet growing power demand from data centers and electrification without causing already rising electricity costs to soar further.
But Wright casts cheap, clean power as mere empty calories that steal market share from coal, gas, and nuclear power. Energy supplied only when “the weather is mild, when the sun shines or the wind blows, doesn’t add anything to the capacity of our electricity grid,” he said. “It just means we send subsidy checks to those generators, and we tell the other generators, ‘Turn down.’”
Here, Wright mischaracterizes how utilities and grid operators dispatch power plants. Wind and solar often “turn down” when they’re generating more power than the grid needs. But fossil-fueled power plants stop generating when their power is too expensive to compete with what wind and solar generators are offering — market forces in action.
It’s worth mentioning, too, that utilities and grid operators are well aware that wind and solar are weather-dependent and don’t produce all the time. These experts constantly assess the availability of all resources — not just renewables — and plan accordingly.
Wright also neglected to say that fossil fuels themselves can fail during winter storms — and often in less predictable and more harmful ways than when the sun sets or the wind dies down.
That’s what happened during Winter Storm Uri in 2021. That storm swept over the U.S. Southeast — and in particular, Texas — bringing subzero temperatures that froze wellheads and restricted the flow of gas to power plants, which were experiencing their own weather-related failures. The result was catastrophic: More than 200 people died and roughly 4.5 million homes and businesses lost power. Similar gas-system freeze-ups drove winter blackouts across the Southeast in 2022 and during the 2014 “polar vortex” in the Northeast.
During Winter Storm Fern, it was a different story: Generator failures did not force utilities and grid operators to shut off power. One likely reason is that, in the years since Uri, regulators have imposed winterization requirements on owners of gas power plants in Texas and other parts of the country, though just how effective those interventions were is not yet clear.
Another probable factor contributing to the grid’s resilience this time around was having a better overall mix of resources. Energy experts agree that portfolios of mutually reinforcing resources are the key to grid reliability. In the Lone Star State, solar and battery storage have surged in recent years. Texas’ grid weathered this January’s cold snap, experts say, because it had an array of fuel sources on hand.
But of course, Wright didn’t acknowledge any of that. He simply railed against renewables, painting them as leeches on the power system.
Fossil-fueled power plants remain vital to the U.S. grid, whether they’re designed to run around the clock or only during emergencies, as is the case for New England’s oil-burning generators — one of the grid’s costliest resources, precisely because they run so infrequently. But renewables are vital, too. In New England, the gigawatts of offshore wind being built from Connecticut to Maine that have been under attack since the first day of the second Trump administration are also one of the most valuable winter resources for the region.
The DOE’s job is not to take a snapshot of the worst 15 minutes of the year and use it to justify policies that freeze in place that exact mix of grid resources. Instead, it’s to assess and manage the grid’s evolving technical, economic, environmental, and climatic realities, and to foster newer, better resources to replace those that aren’t keeping up.
The more Wright pretends otherwise, and uses half-truths to force fossil fuels onto a system that would be better served by cheaper and cleaner alternatives, the worse off we’ll all be.
Startup NineDot Energy just raised $431 million to build batteries in New York City’s vacant nooks and crannies — an endeavor that will help the metropolis fend off looming electricity shortages.
The debt financing announced Monday will support the Brooklyn firm’s plan to develop 28 battery projects totaling 494 megawatt-hours of energy storage capacity over the next two years. NineDot estimates that’s enough storage to meet the peak energy needs of about 100,000 households.
NineDot is one of several companies deploying “community battery systems” — grid-tied energy storage installations that can fit into roughly an acre of land or less — in New York City. These systems sop up excess energy from the grid when power is abundant and send it back when demand is high, like on hot summer afternoons when millions of air conditioners crank up. Bigger batteries may be able to store more energy, but community-scale systems can be more realistic to quickly deploy in über-dense places.
The decade-old startup’s latest round of construction finance, led by Natixis Corporate & Investment Banking, brings its total funding to just over $1 billion, said David Arfin, NineDot’s CEO and co-founder.
NineDot already has seven projects operating — including a 12-megawatt-hour battery and solar installation at a former parking lot in the Bronx and a 20-megawatt-hour battery system in Staten Island — or in advanced stages of construction in New York City, he said. By 2028, it plans to have 37 community storage systems with a combined capacity of 1.6 gigawatt-hours up and running across the five boroughs, he said.
It isn’t easy to find spots to build batteries in New York City, said Adam Cohen, NineDot’s chief technology officer and co-founder. It can be even harder to find space on Con Edison’s power grid to connect them, he said.
But the utility is under mounting pressure to expand its energy storage capacity — and that’s driving companies like NineDot to seek out vacant or underused lots in the country’s densest urban environment.
New York law sets a statewide goal of 70% renewable electricity by 2030, and state policy calls for building 6 gigawatts of energy storage by 2030. Upstate New York has plenty of land for utility-scale wind, solar, and battery farms. But downstate New York and New York City are where power demand is greatest and the generation mix is the dirtiest — and there’s not yet enough transmission grid capacity to solve those problems with clean power from the north, Cohen said.
Meanwhile, the New York City area faces an energy crunch as power demand surges and aging fossil-fueled plants in the boroughs prepare to shutter. In October, the state’s grid operator warned that New York City and Long Island might face “reliability violations” as soon as this summer.
Late last year, state regulators ordered Con Edison to seek out “a broad array of potential non-emitting solutions” that could quickly bolster reliability.
“You could solve that with new transmission,” Cohen said — except that’s hard to build. The Champlain Hudson Power Express, a major transmission line from Canada to New York City, is nearing completion and scheduled to start delivering hydropower and wind power in May. But another major transmission line being planned to carry power into the city was canceled in 2024.
Another option is “keeping dirty peaker plants online,” Cohen said. But the fossil-fueled plants that New York City relies on to serve its peak loads are expensive to operate and emit health-harming air pollutants, largely in low-income communities and communities of color.
That’s why state regulators’ order to Con Edison calls for “non-emitting solutions, prioritizing cost-effectiveness and ease of deployment, and minimizing impacts to disadvantaged communities.”
Batteries fit that bill, say proponents of the tech. William Acker, executive director of the New York Battery and Energy Storage Technology Consortium, noted that the utility’s initial report to regulators in January identified a roughly 125-megawatt shortfall for about three hours during peak summer demand starting in 2032. This is “well within the range of the energy storage we expect to be deployed,” he said.
“That’s changing how the state is looking at energy storage deployment in New York City,” Acker said. “It’s one of the most cost-effective ways to address this reliability challenge.”
New York state has struggled to meet its targets for utility-scale clean energy, with supply chain disruptions and rising interest rates undermining the financial prospects for big wind and solar farms. It’s also faced challenges in getting large-scale battery projects up and running, largely because of problematic contract structures that crimped project financing.
But smaller community battery projects, like NineDot’s, have an advantage on that front: They can access the state’s incentives designed to encourage distributed energy resources that deliver power when and where the grid needs it the most. These incentives offer far steadier and more predictable revenue streams than those set up for the state’s larger-scale utility programs, Arfin said.
Community battery projects are also eligible to feed into New York’s Statewide Solar for All program, which provides a portion of revenues from community solar and storage projects to utility customers in disadvantaged communities who are enrolled in energy-affordability programs. NineDot forecasts that the projects it has committed to Statewide Solar for All will deliver more than $60 million in energy credits over the coming decade.
NineDot’s strategy of putting batteries on vacant or underutilized lots is one of several approaches being taken to add energy storage to the New York City grid. For example, Con Edison has deployed batteries at its substations and worked with companies installing them at EV charging stations and electric school bus depots. And some New York City businesses are using small plug-in batteries to cushion their draw on grid power during hours of peak demand.
Meanwhile, larger-scale projects like 174 Power Global’s 400-megawatt-hour battery in Queens are starting to get built, and energy developers, including Summit Ridge Energy and Convergent Energy and Power, have community battery projects underway.
But batteries in the Big Apple aren’t always getting a warm reception from their neighbors. Public opposition, spurred by a spate of grid battery fires, has quashed several projects in Staten Island and has led to an ongoing moratorium on their construction in the Long Island town of Oyster Bay. New York City mayoral candidate Curtis Sliwa railed against battery projects in the waning days of his campaign last year, calling them “mini-Chernobyls.”
But Cohen noted that the Fire Department of New York has spent years developing grid-battery safety rules that may be the most comprehensive in the country. “The FDNY is the global gold standard for approving battery storage technology and sites,” he said. “It’s cumbersome — but it’s trusted and thorough.”
A decade ago, North Carolina boasted more solar power than any other state in the country but California — a distinction owed to scores of large projects built under a suite of clean energy–friendly policies that the Tar Heel State has since repealed or amended.
Now, many of those solar farms are staring down the end of their initial agreements with Duke Energy, the state’s predominant utility. But under a new proposal before North Carolina regulators, project owners could lock in favorable long-term renewals pending one main condition: They have to add batteries.
The scheme was proffered by Duke and is backed by clean energy businesses and advocates. If it’s green-lit by the North Carolina Utilities Commission, it would represent the first systematic move toward “repowering” large-scale solar facilities in the state. The potential is enormous: Contracts expiring in the next five years total 1.9 gigawatts — an amount equal to more than a quarter of North Carolina’s entire utility-scale solar fleet.
Since battery storage will benefit from federal tax credits with few strings attached for at least another six years, and Duke faces daunting power demands from coming data centers and other large electricity users, this form of repowering could support reliability and affordability. In large swaths of rural North Carolina, extending the life of these older projects also makes more sense than decommissioning them.
“Adding batteries to a system that’s already out there makes it immensely more valuable to the grid,” said Steve Kalland, executive director of the North Carolina Clean Energy Technology Center. “In North Carolina, that’s going to be significant.”
More so than its ample sunshine or abundant open space, state policy propelled North Carolina to become a national solar leader back in 2016.
A decades-old state tax credit supplemented federal incentives, and in 2007, lawmakers adopted a modest but meaningful renewable energy requirement. But perhaps most important was the state’s implementation of a federal law designed to encourage small power producers independent of utility monopolies. North Carolina’s rules under the Public Utility Regulatory Policy Act, or PURPA, were among the most favorable in the country, with standard offer, 15-year contracts available for projects with up to 5 megawatts of capacity.
This cocktail of rules and mandates caused PURPA-qualified solar projects to soar, with over 450 large-scale developments coming online in the state from 2010 to 2017, according to the nonprofit North Carolina Sustainable Energy Association, with a capacity of over 3.3 gigawatts.
But by 2017, Duke was on pace to easily meet the clean energy mandate, and Republican state lawmakers had repealed the tax incentive. What’s more, the utility said the surge in solar was creating interconnection bottlenecks and the need for expensive grid upgrades.
So the company helped draft a new state law that year meant to clear the backlog and move most new solar into a competitive procurement process. The standard offer contracts under PURPA survived but were reduced to 10 years for projects with up to 1 megawatt.
In part due to the PURPA changes, annual solar installations in the state have slowed, dropping from a peak of 985 megawatts in 2017 to an average of just under 500 megawatts in the years that followed.
How much should data centers pay for the massive amounts of new power infrastructure they require? Wisconsin’s largest utility, We Energies, has offered its answer to that question in what is the first major proposal before state regulators on the issue.
Under the proposal, currently open for public comment, data centers would pay most or all of the price to construct new power plants or renewables needed to serve them, and the utility says the benefits that other customers receive would outweigh any costs they shoulder for building and running this new generation.
But environmental and consumer advocates fear the utility’s plan will actually saddle customers with payments for generation, including polluting natural gas plants, that wouldn’t otherwise be needed.
States nationwide face similar dilemmas around data centers’ energy use. But who pays for the new power plants and transmission is an especially controversial question in Wisconsin and other “vertically integrated” energy markets, where utilities charge their customers for the investments they make in such infrastructure — with a profit, called “rate of return,” baked in. In states with competitive energy markets, like Illinois, by contrast, utilities buy power on the open market and don’t make a rate of return on building generation.
Although seven big data-center projects are underway in Wisconsin, the state has no laws governing how the computing facilities get their power. Lawmakers in the Republican-controlled state Legislature are debating two bills this session. The Assembly passed the GOP-backed proposal on Jan. 20, which, even if it makes it through the Senate, is unlikely to get Democratic Gov. Tony Evers’ signature. According to the Milwaukee Journal Sentinel, a spokesperson for Evers said on Jan. 14 that “the one thing environmentalists, labor, utilities, and data center companies can all agree on right now is how bad Republican lawmakers’ data center bill is.” Until a measure is passed, individual decisions by the state Public Service Commission will determine how utilities supply energy to data centers.
The We Energies case is high stakes because two data centers proposed in the utility’s southeast Wisconsin territory promise to double its total demand. One of those facilities is a Microsoft complex that the tech giant says will be “the world’s most powerful AI datacenter.”
The utility’s proposal could also be precedent-setting as other Wisconsin utilities plan for data centers, said Bryan Rogers, environmental justice director for the Milwaukee community organization Walnut Way Conservation Corp.
“As goes We Energies,” Rogers said, “so goes the rest of the state.”
We Energies’ proposal — first filed last spring — would let data centers choose between two options for paying for new generation infrastructure to ensure the utility has enough capacity to meet grid operator requirements that the added electricity demand doesn’t interfere with reliability.
In both cases, the utility will acquire that capacity through “bespoke resources” built specifically for the data center. The computing facilities technically would not get their energy directly from these power plants or renewables but rather from We Energies at market prices.
Under the first option, called “full benefits,” data centers would pay the full price of constructing, maintaining, and operating the new generation, and would cover the profit guaranteed to We Energies. The data centers would also get revenue from the sale of the electricity on the market as well as from renewable energy credits for solar and wind arrays; renewable energy credits are basically certificates that can be sold to other entities looking to meet sustainability goals.
The second option, called “capacity only,” would have data centers paying 75% of the cost of building the generation. Other customers would pick up the tab for the remaining 25% of the construction and pay for fuel and other costs. In this case, both data centers and other customers would pay for the profit guaranteed to We Energies as part of the project, though the data centers would pay a different — and possibly lower — rate than other customers.
Developers of both data centers being built in We Energies’ territory support the utility’s proposal, saying in testimony that it will help them get online faster and sufficiently protect other customers from unfair costs.
Consumer and environmental advocacy groups, however, are pushing back on the capacity-only option, arguing that it is unfair to make regular customers pay a quarter of the price for building new generation that might not have been necessary without data centers in the picture.
“Nobody asked for this,” said Rogers of Walnut Way. The Sierra Club told regulators to scrap the capacity-only option. The advocacy group Clean Wisconsin similarly opposes that option, as noted in testimony to regulators.
But We Energies says everyone will benefit from building more power sources.
“These capacity-only plants will serve all of our customers, especially on the hottest and coldest days of the year,” We Energies spokesperson Brendan Conway wrote in an email. “We expect that customers will receive benefits from these plants that exceed the costs that are proposed to be allocated to them.”
We Energies has offered no proof of this promise, according to testimony filed by the Wisconsin Industrial Energy Group, which represents factories and other large operations. The trade association’s energy adviser, Jeffry Pollock, told regulators that the utility’s own modeling of the capacity-only approach showed scenarios in which the costs borne by customers outweigh the benefits to them.
Clean energy is another sticking point. Clean Wisconsin and the Environmental Law and Policy Center want the utility’s plan to more explicitly encourage data centers to meet capacity requirements in part through their own on-site renewables, and to participate in demand-response programs. Customers enrolled in such programs agree to dial down energy use during moments of peak demand, reducing the need for as many new power plants.
“It’s really important to make sure that this tariff contemplates as much clean energy and avoids using as much energy as possible, so we can avoid that incremental fossil fuel build-out that would otherwise potentially be needed to meet this demand,” said Clean Wisconsin staff attorney Brett Korte.
And advocates want the utility to include smaller data centers in its proposal, which in its current form would apply only to data centers requiring 500 megawatts of power or more.
We Energies’ response to stakeholder testimony is due on Jan. 28, and the utility and regulators will also consider public comments that are being submitted. After that, the regulatory commission may hold hearings, and advocates can file additional briefs. Eventually, the utility will reach an agreement with commissioners on how to charge data centers.
Looming large over this debate is the mounting concern that the artificial-intelligence boom is a bubble. If that bubble pops, it could mean far less power demand from data centers than utilities currently expect.
In November, We Energies announced plans to build almost 3 gigawatts of natural gas plants, renewables, and battery storage. Conway said much of this new construction will be paid for by data centers as their bespoke resources.
But some worry that utility customers could be left paying too much for these investments if data centers don’t materialize or don’t use as much energy as predicted. Wisconsin consumers are already on the hook for almost $1 billion for “stranded assets,” mostly expensive coal plants that closed earlier than originally planned, as Wisconsin Watch recently tabulated.
“The reason we bring up the worst-case scenario is it’s not just theoretical,” said Tom Content, executive director of the Citizens Utility Board of Wisconsin, the state’s primary consumer advocacy organization. “There’s been so many headlines about the AI bubble. Will business plans change? Will new AI chips require data centers to use a lot less energy?”
We Energies’ proposal has data centers paying promised costs even if they go out of business or otherwise prematurely curtail their demand. But developers do not have to put up collateral for this purpose if they have a positive credit rating. That means if such data center companies went bankrupt or otherwise couldn’t meet their financial obligations, utility customers may end up paying the bill.
Steven Kihm, the Citizens Utility Board’s regulatory strategist and chief economist, gave examples of companies that had stellar credit until they didn’t, in testimony to regulators. The company that made BlackBerry handheld devices saw its stock skyrocket in the mid-2000s, only to lose most of its value with the rise of smartphones, he noted. Energy company Enron, meanwhile, had a top credit rating until a month before its 2001 collapse, Kihm warned. He advised regulators that data center developers should have to put up adequate collateral regardless of their credit rating.
The Wisconsin Industrial Energy Group echoed concerns about risk if data centers struggle financially.
“The unprecedented growth in capital spending will subject [We Energies] to elevated financial and credit risks,” Pollock told regulators. “Customers will ultimately provide the financial backstop if [the utility] is unable to fully enforce the terms” of its tariff.
Jeremy Fisher, Sierra Club’s principal adviser on climate and energy, equated the risk to co-signing “a loan on a mansion next door, with just the vague assurance that the neighbors will almost certainly be able to cover their loan.”
This analysis and news roundup come from the Canary Media Weekly newsletter. Sign up to get it every Friday.
Back in 2021, Winter Storm Uri resulted in more than 240 deaths in Texas as freezing temperatures shut down gas power plants and pushed the state’s independent electricity grid to the brink of collapse.
It was an example of a worst-case wintertime scenario for the power sector — and of how fossil fuel resources, often touted for their reliability, can falter when they’re needed most.
So when the massive Winter Storm Fern was bearing down on more than half of the U.S. last week, including Texas and much of the Southeast, onlookers braced for a repeat. And while the grid was indeed pushed to its limit, it weathered the storm.
In Texas, efforts to winterize power plants following Uri paid off, and the state avoided forced shutoffs this time around. Texas also has added a tremendous amount of wind, solar, and battery storage over the past few years, helping its grid keep pace amid the blistering cold. It’s true that Fern wasn’t as intense of a storm as Uri, but University of Texas energy professor Michael Webber told KXAN that the current grid likely would’ve avoided much of 2021’s devastation.
In New England, which was hammered with snow and intense cold, the power grid was stable but dirtier than usual: It had to rely heavily on oil, a reserve fuel that is especially polluting.
One big reason? Canadian hydropower, usually a key source, was hard to come by as that nation dealt with its own cold spell, and gas was in short supply, too, as New England homes burned more of it for heating. For what it’s worth, Vineyard Wind — the nearly complete offshore wind farm that just this week defeated a Trump administration stop-work order — provided a notable boost to the grid even in its partially finished state.
But it wasn’t all good news. More than one million people lost power during the storm, particularly in the Southeast, and thousands are still in the dark as of this morning. Power plant shutoffs aren’t to blame, but rather challenges with the grid itself are, including toppled utility poles, iced-over substations, and downed transmission lines.
PJM Interconnection — the nation’s largest grid operator, which spans the mid-Atlantic — suffered the most intense impact. Data analyzed by think tank Energy Innovation suggests that frozen pipelines and other infrastructure curbed fossil-fueled power plants’ output by tens of gigawatts in the region.
This reduced power generation luckily didn’t force PJM to institute rolling blackouts. But it did, as Energy Innovation put it, underscore a clear point: It’s not viable to rely on fossil fuels alone to get through intense winter weather — and the Trump administration’s efforts to block solar and wind while propping up fossil fuels could prove dangerous if taken to their extreme.
Outside the U.S., offshore wind sails ahead
As the Trump administration turns its back on offshore wind, the rest of the world is going full speed ahead. Ten European countries formed a coalition this week to build out 100 GW of offshore wind power, Alexander C. Kaufman reports. It’s all part of an effort to turn the North Sea into“the world’s largest clean energy reservoir,” German Chancellor Friedrich Merz said.
The announcement follows China’s insistence last week that it will continue to build its offshore wind dominance, even after a dig from Trump.
Back in the U.S., there’s at least a smidgen of good news on offshore wind. On Tuesday, a federal judge ruled that Vineyard Wind can resume construction. It’s one of five offshore wind farms that the Trump administration ordered to stop work in December; judges allowed three other projects to continue building last week. Developer GE Vernova says it could face a $250 million loss this year due to Vineyard Wind’s installation delays.
Tribes press on with clean energy construction
Tribes from coast to coast have long suffered inequities in energy access and affordability. Funding issued under the Biden administration was meant to change that by financing solar farm construction, microgrid development, and other projects to help tribes take advantage of their enormous wind and solar energy potential.
That all got a lot harder when the Trump administration canceled billions of dollars in clean energy funding, Canary Media’s Jeff St. John reports. But tribes are still finding ways to push their projects forward, including with help from the Alliance for Tribal Clean Energy, which brings together tribes, charitable foundations, and clean energy financiers.
“The scale of this disruption is undeniable,” Chéri Smith, president and CEO of the alliance, told Jeff. “But we have to do something. We can’t just sit there.”
Chargers keep cruising: The U.S. built more than 18,000 new public EV-charging stations last year despite the Trump administration’s freeze on EV-charging grants and other efforts to derail the EV transition. (Canary Media)
Tesla’s solar pivot: Tesla announces plans to build its own solar panel at its Buffalo, New York, factory, marking a recommitment to home energy as it moves away from EVs. (Canary Media)
Funding climate resilience: Maine lawmakers advance a “climate superfund” bill that would require fossil fuel companies to pay for damages caused by climate change, and Illinois and Connecticut move toward introducing similar measures. (Maine Morning Star, Hartford Courant, Inside Climate News)
Solar coexistence: A new study debunks the myth that solar panels are destroying huge swaths of North Carolina farmland, finding that arrays take up just 0.28% of land that’s classified as agricultural. (Canary Media)
Data centers’ concrete impacts: Building a data center with traditional concrete can result in tons of additional carbon emissions — a fact that’s driving tech companies to start buying low-emissions versions of the material. (Bloomberg)
Nuclear changes: Internal documents show the DOE is quietly overhauling nuclear safety regulations and sharing the changes with affected companies in an attempt to speed development of next-generation reactors. (NPR)
Preserving plants: The Gemini Solar Project outside Las Vegas shows that careful planning can preserve delicate plants and other species when solar farms are built, and even help them thrive. (Grist)
First it got cold. Across New England, temperatures have been almost constantly below 20 degrees Fahrenheit since last Friday night.
Then it snowed. Winter Storm Fern swept through the region on Sunday and Monday, leaving more than two feet of white stuff in its wake in many places.
But despite the extreme weather, the lights stayed on in the Northeast, for the most part.
At a moment when there is copious debate over how, and how much, to strengthen and expand the New England electric grid, this past weekend functioned as a sort of stress test for the system, highlighting both its strengths and its shortcomings. A closer look at how the grid managed to keep us watching football games and charging our phones offers a few key lessons.
The climate challenges posed by Winter Storm Fern cropped up just a week after the long-awaited New England Clean Energy Connect transmission line started sending hydropower from Quebec into the Northeast U.S. Its purpose: to supply more than 1 gigawatt of power to customers in Massachusetts, providing clean energy and cost savings to the state, which has struck a long-term procurement deal with Canadian energy giant Hydro-Québec.
Last Friday and early Saturday, power flowed as expected. But from Saturday afternoon until Monday afternoon, the exports stopped for all but a few hours on Sunday. Quebec, also experiencing bitter cold, needed the power for its own heating systems. In fact, demand in the province was so high that New England began sending it electricity via a transmission line usually used to bring Canadian power into the U.S.
“There was an expectation that there was a higher quantity and more consistent flows than what happened in practice,” said Dan Dolan, president of the trade group New England Power Generators Association. “The timing of this is certainly drawing a lot of attention, just a week into the commissioning of the project.”
Hydro-Québec didn’t do anything illegal or unethical, Dolan said, and its CEO has indicated the company is prepared to pay the penalties outlined in its contract with Massachusetts for not sending power as obligated. Still, this weekend makes clear that the much-vaunted new transmission line might not do as much to alleviate the region’s energy concerns as had been hoped.
As Canadian hydropower stopped coming, New England also had to cope with constrained natural gas supplies. People throughout the region needed the fossil fuel to warm their houses, limiting the supply that was available to power plants and spiking prices. As a result, usually expensive oil generation became the more economical option. Rarely used oil-burning power plants were called into action, producing more than a third of the power flowing onto the grid for some periods. For a sense of scale: Oil-fired generation provided roughly 1% of the region’s power in 2025.
The sudden dependence on one of the dirtiest forms of power supply makes it clear that the region needs to generate more electricity from a wider range of resources, grid experts say. The grid will be more reliable and more economical if it doesn’t have to put so many of its eggs in an expensive, high-emissions basket like oil.
“The cold temperatures and the storm really, really highlight the importance of a portfolio approach,” said Valessa Souter-Kline, managing director of the industry association Advanced Energy United.
Planning for a future of more abundant power supply is all well and good, but the cost and high emissions of burning oil for electricity highlight the need to do more with the grid we have now, said Phelps Turner, director of clean grid for environmental advocacy group the Conservation Law Foundation.
The region needs to expand demand-response programs, he said. These initiatives compensate consumers for scaling back their energy use at times of particularly high demand, freeing up electrons for other customers. Commercial operations might power down some machines or use an on-site generator for a time, while residential customers might hold off on running their dishwashers for a couple of hours or charge their EVs overnight rather than in the early evening.
“We have to be more proactive about managing demand for electricity,” Phelps said. “Those programs aren’t going to solve all of our problems, but they are a tool that needs to be used in situations like this.”
Much of the conversation about the weekend’s grid performance has focused on the lack of power along the new transmission line and the spike in oil-fired generation. However, wind also made solid contributions to the stability of the system. Overnight Friday, into Saturday, more than 1.5 gigawatts of wind power — roughly 10% of New England’s total load — was flowing onto the grid.
Data from grid operator ISO New England does not break out the contributions of onshore and offshore wind. Energy insiders, however, are confident that Vineyard Wind — the nearly completed development off the coast of Massachusetts that’s already sending some power to the grid — played a significant role in wind’s strong performance.
The numbers suggest that offshore wind could live up to its promise of providing a robust power supply, particularly in the winter. That could go a long way in addressing the region’s energy affordability woes: An analysis released in 2025 concludes that Massachusetts utility customers would’ve saved as much as $212 million during the winter of 2024–25 if the region had had 3.5 GW of offshore wind capacity online.
Of course, this potential only matters if offshore wind developments can actually get built. Federal judges have allowed work to resume on four of the five under-construction projects stopped last month by the Trump administration, but federal policies and challenging economic conditions have stalled or scuttled at least three others in development.
This past weekend, however, made a strong case for the value that offshore wind can bring, experts said.
“Here in New England, low temperatures and strong winds tend to travel together,” Turner said. “Offshore wind can be an incredibly important and valuable resource during cold snaps like this one.”
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