Illustration: Sarah Grillo / Axios
Many state legislatures are wrapping up their work, with some advancing fossil fuel–friendly and nuclear bills to meet soaring energy demand.
Why it matters: States will be a proving ground for GOP efforts to build out gas and nuclear plants to help data center development — as well as Democrats' moves to counter Trump administration federal policy rollbacks.
Here's a rundown of what we're tracking…
Texas: The GOP-dominated legislature is still considering a bill that would create a "dispatchable" generation credit trading program. It passed the state Senate in late March.
- It would effectively require half of new power capacity to come from nuclear, coal or — most likely — natural gas.
- "In our view, the legislation could materially slow renewable power buildout in the current largest market for new solar and wind capacity," ClearView Energy Partners wrote.
Arizona: Democratic Gov. Katie Hobbs vetoed multiple bills from the GOP-controlled legislature that would have similarly prioritized deployment of "dispatchable" fossil fuel and nuclear plants over renewables.
- One bill would have prevented Arizona's utility regulator from authorizing power retirements unless there is a new source of generation of "equal or greater size" and directed it to prioritize "dispatchable sources."
- "Bills like this one that seek to disincentivize, deprioritize, or otherwise limit new renewable energy projects directly threaten Arizona's energy workforce growth and the associated potential for lowered energy bills, while at the same time putting our grid reliability at risk," Hobbs wrote in a letter vetoing the legislation.
New Mexico: Democratic Gov. Michelle Lujan Grisham signed legislation that will raise the oil and gas royalty rate on state land from 20% to 25%.
- State officials estimate it will generate more than $1 billion in additional revenue for New Mexico in the coming decades. That also matches what operators pay in the Permian basin in neighboring Texas.
- She also signed legislation to create a Strategic Water Supply program promoting the treatment of brackish water for industrial uses, though it omitted proposals to use oil and gas wastewater.
Colorado: Democratic Gov. Jared Polis signed legislation last month to add nuclear energy to the state's formal definition of a "clean energy resource."
- That makes it eligible for state and local financing and lets utilities use nuclear to meet Colorado's 2050 clean energy target.
- Polis had also been pushing legislation to update the state's clean energy target to 100% by 2040, but it faced pushback from utilities and business groups and likely won't move this year, per Colorado Public Radio.
California: Democratic Gov. Gavin Newsom signed a bill to offer $170 million for vegetation and forest management after the wildfire that devastated Los Angeles this year.
- The state continues to seek federal aid for those fires.
West Virginia: The legislature passed a bill this month that would aim to speed data center development on microgrids.
- GOP Gov. Patrick Morrisey called it his "landmark policy proposal" for the 2025 session.
- But Democrats and environmental groups oppose it. They worry it would bolster fossil fuel development to power data centers and lead to heavy development near wilderness areas.
- Lawmakers have also passed legislation that would allow state natural resource managers to lease space under state parks for CO2 storage after EPA granted West Virginia authority to permit injection wells this year.
Ohio: Both chambers of the legislature have passed bills that would repeal infamous subsidies for two coal plants in the state that became the center of a bribery scandal.
- The bailouts have cost Ohio ratepayers nearly $670 million, according to the Ohio Manufacturers' Association.
- State Rep. Josh Williams, a Republican, said the legislation would "eliminate the last pillar of the largest bribery scandal in Ohio history."
- The House and Senate still have to reconcile their respective versions of the bill.
What we're watching: Multiple blue-state legislatures, including Maryland and New Jersey, are eyeing legislation to codify climate and 100% clean energy targets.
- Minnesota is debating a measure that would sunset the state's community solar program and reduce the financial benefits of onsite solar for utility customers in small towns and rural areas. Environmental groups have criticized the proposal.
- And Illinois is considering bills that would build out new transmission and energy storage.
In North Carolina, meanwhile, the GOP-controlled General Assembly is considering legislation to nix its interim 2030 carbon emissions reduction target. Democratic Gov. Josh Stein has criticized the legislation.
