Joseph Krist

Publisher

The Muni Credit News is taking next week off. The next issue will be dated April 20, 2026. Maybe by then there will be a NYS state budget. And that will enable much of the focus directed towards the New York City budget. One thing we know is that busses will not be free this year in the City. We expect that this is but one of several retreats we will see from campaign promises made by Mayor Mamdani as his aspirations collide with reality.

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PUERTO RICO SOLAR

Rooftop solar generating capacity in Puerto Rico totaled 1,456 megawatts (MW) at the end of 2025, 20% of the overall capacity mix. Rooftop solar capacity has increased faster than other sources over the past decade. Between 2016 and 2025 rooftop solar installations accounted for 81% of the new generating capacity in Puerto Rico. In 2025, rooftop solar became the second-largest capacity source, after petroleum liquids (oil) capacity (3,671 MW), and surpassed natural gas capacity (1,391 MW).

In addition to rooftop solar capacity, distributed battery storage has also increased in Puerto Rico. According to data from the Puerto Rico Energy Bureau (PREB), 171,372 households and businesses had a distributed battery storage system at the end of 2025, with a total energy capacity of 2,864 megawatt hours.

NUCLEAR

The Nuclear Regulatory Commission renewed Diablo Canyon’s license to operate, ensuring that California’s last remaining nuclear facility will continue to run through at least 2030. The license renewal from the commission allows the plant to remain running for 20 years, although extending it past 2030 would require additional action from the California Legislature. The plant was originally slated to close in 2025, but lawmakers extended the deadline by five years in 2022, citing ongoing need for power from a plant that provides more than 8% of the state’s electricity.

New Jersey has enacted legislation which had effectively prevented the development of new nuclear generating assets in the state. The bill eliminates the need for a permanent waste-disposal strategy to come before a new reactor can be built. Intermediate storage disposal has a three decade track record. Ironically,  many intermediate storage containers are produced in New Jersey, at manufacturer Holtec International’s factory in Camden.  

New Jersey is the second state- along with Illinois – to end moratoria on nuclear generation development this year. They joined Wisconsin, Kentucky, Montana, West Virginia in having done the same over the last decade.

FLORIDA CLIMATE DENIAL

HB 1217, all government entities are banned from pursuing any “resolution, ordinance, rule, code, or policy” to support a net-zero policy. That includes levying charges based on greenhouse gas emissions or implementing a cap-and-trade program, which states like California and Washington have used to curb emissions. The bill also bars local governments from paying “dues, membership fees, subscription fees, or charitable contributions” to any organization that has a net-zero policy.

The bill also prevents governments from procuring vehicles or equipment based solely on the type of fuel source used in order to advance net-zero goals. Miami-Dade County estimated that it’s electric bus procurement program — on which the county has already spent over $70 million on — could take a significant hit, though the county is still reviewing exact impacts of the bill.  If signed into law, the bill will go into effect July 1.

DATA CENTER VOTES

Voters in the Milwaukee, WI suburb of Port Washington approved a measure limiting the ability of local government to grant tax breaks by a roughly 2-to-1 margin. The Port Washington referendum requires city leaders to obtain voter approval before awarding developers lucrative tax incentives. The issues behind the vote: transparency, noise pollution, freshwater use and increased energy costs. The same issues driving opposition in Wisconsin are driving opposition across the country.

In New Mexico, Dona Ana County approved the issuance of $165 billion of bonds (not a typo) to finance development of a massive data center for Oracle. The project was the result of a range of negotiations about which information was limited. The perception that the County vote was a fait accompli after closed door negotiations drives legal efforts to stop the bond issue. The bond vote will be challenged in court.

In Maine, the House and Senate have both passed LD 307, a bill that would pause construction on new datacenters until November 1, 2027. It specifically targets datacenters of 20 megawatts or more and calls for the creation of a Maine Data Center Coordination Council to better plan and facilitate the massive construction projects. 

Residents in Monterey Park, California, will decide in June on a measure seeking to indefinitely ban new data center construction within city limits. In August, Augusta Township in rural Michigan will decide whether to override a local ordinance that cleared the way for a data center project. In November, Janesville, Wisconsin will vote on a measure that could scuttle plans to redevelop a former General Motors assembly plant into an AI factory. It was the closure of the GM plant that led to a chain of events leading to the ill-fated Foxconn development undertaken during Trump 1.0.

EVERYTHING IS BIGGER IN TEXAS

Texas legislators are indicating that tax breaks for data centers are proving too successful. Early in the last decade, Texas legislators approved tax breaks to support data centers. At the time, these facilities were smaller and required fewer resources. From 2014 to 2022, the exemption amounted to between $5 million and $30 million in lost state revenue per year. By 2023, that lost revenue amounted to more than $150 million. The AI stampede now sees that this year Texas is forgoing at least $1.3 billion based on state projections.

Texas is one of 37 states offering tax exemptions for data centers, most of which are sales tax exemptions tied to local economic growth requirements. There are currently 121 data centers receiving the sales tax break, according to a comptroller’s office database. Three years ago, the comptroller’s office projected the tax break would be valued at about $180 million in the 2027-2028 biennial budget. In 2025, the projection was revised upward to more than $3 billion.

Under existing law, qualifying data centers are exempted from paying the state’s 6.25% sales taxes on purchases related to building and maintaining the facility — including servers and other data storage hardware, software, office equipment, the cooling system, emergency generators and plumbing. Data centers are also exempted from paying state sales taxes on the cost of electricity. It is a significant benefit given the enormous energy demand of the facilities. 

A recent Quinnipiac poll found 65% of Americans oppose the construction of a data center in their community.

PUBLIC POWER SOLAR

Pasadena Water and Power is launching a pilot program offering new rebates for residential and commercial solar installations and battery storage. Eligible PWP residential electric customers can receive a rebate of $0.60 per watt for the purchase and installation of a new, permanent rooftop solar system, or for the expansion of an existing system. Customers enrolled in one of PWP’s income-qualified bill assistance programs are eligible for a rebate of $1.00 per watt. Battery energy storage incentives are also available and offer up to $550 per kilowatt-hour.

Qualifying commercial customers may receive rebates of up to $80,000 per meter for installing new, permanent rooftop solar systems or expanding existing systems. Tiered rebates for battery energy storage are also available up to $80,000 per meter. It is one possible response to changes in the State’s net metering scheme which effectively reduced the financial benefits to residential solar customers.

ENERGY IDEOLOGY AND REALITY

Over the course of March, the nation got more electricity from renewables than it did from natural gas, which is typically the single-largest source of energy on the U.S. grid. Emissions-free sources, a category that includes both renewables and nuclear, produced more than half of the nation’s electricity. Solar, batteries, and wind together will once again make up the overwhelming majority of new energy capacity added to the grid this year. 

Craig No. 1, the coal unit scheduled for retirement in December, 2025 is scheduled to resume operation as we go to press and possible several more days. The plant did not operate at all in 2026 prior to now even though it was ordered to do so by Energy Secretary Chris Wright. The resumption of electrical generation was not ordered by Sec. Wright, but instead by the Southwest Power Pool. SPP cited resources outages and load and intermittent resource uncertainty in telling Tri-State Generation and Transmission, the operator and part owner of the unit, to resume operation.

VW informed employees in Chattanooga and the United Auto Workers union that it will cease production of the electric ID.4 at its plant in Chattanooga, TN. It will instead produce the Atlas and the Atlas Cross Sport, gas powered vehicles. The ID.4 saw an increase in sales in 2025, rising from 17,000 in 2024 to 22,400. Those figures were skewed by buyers seeking to purchase an electric vehicle before federal tax credits for the automobiles expired Sept. 30. The impact of that policy change showed up in January of this year when the electric VW SUV was the slowest-selling vehicle in the United States. 

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