Solmar Insights
US energy and digital infrastructure markets ended the week with headline deal activity, driven by surging demand from hyperscale data centers and a string of grid and interconnection reforms. Mega-acquisitions, strategic PPAs, and large corporate financings unfolded against a backdrop of grid constraints, new policies, and the race to secure firm power and transmission for next-generation workloads.
Key figures
$1.05 billion Avantus credit facility for 24 GW solar and storage
$489 million DOE loan for Puerto Rico battery storage
17 GW Southern Company data center load commitments
8,000 miles of new Zayo fiber with Nvidia as anchor
Mega-deals, M&A, and capital raise targets grid flexibility
The week opened with a round of major deal headlines reflecting investor willingness to back US grid flexibility and distributed energy. Avantus closed a $1.05 billion upsized credit facility to advance its 24 GW US pipeline in solar and storage, demonstrating scale financing appetite for renewables in California and the Desert Southwest. M&A momentum remained strong, as Goldman Sachs Alternatives entered agreement to acquire RWE Americas’ distributed clean energy assets, 348 MWdc operating and 1.2 GW in the pipeline across 16 states, sharp evidence investors are targeting distributed power platforms for grid agility and long-term contracted returns. On the digital infrastructure side, Zayo will construct 8,000 miles of long-haul fiber for AI data workloads, anchored by Nvidia, signaling growing convergence with power transmission priorities. State and federal commitments paralleled these corporate moves, with Ohio earmarking $20 million for new middle-mile fiber to accelerate connectivity across 15 counties.
Data center power demand shapes resource competition and siting
Relentless data center load growth emerged as a central theme, sharpening competition for dispatchable power and driving utility commitments to record levels. Southern Company reported contracted large load surging to 17 GW, including a 3.2 GW commitment to OpenAI, while introducing innovative demand response to address regional capacity strain. In Texas, the scale of demand forced a bold halt: Governor Abbott ordered a pause on new data center grid connections as the state’s interconnection queue ballooned to 474 GW, prompting a system-wide audit due to reliability concerns. Developers continue to backstop grid constraints with on-site generation; behind-the-meter natural gas generation is increasingly being deployed by hyperscale data centers, competing directly with utilities and LNG projects for fuel supply. At the same time, LS Power expanded its ERCOT fleet with the acquisition of the 606 MW Brazos Valley gas plant, further underscoring the pivot back to firm thermal resources amidst capacity uncertainty.
Hybridization, on-site renewables, and storage scale accelerate
Combined deployments of solar and storage gained momentum as both large utilities and hyperscalers hedge interconnection risk and stabilize variable loads. We Energies broke ground on three major hybrid power sites in Wisconsin blending solar, wind, and batteries for improved reliability. Across the country, a surge of on-site solar and battery installations at data centers signals developers’ push to offset grid delays and localize resilient capacity. Electrovaya’s launch of a high-power, sub-30-minute discharge battery platform added further optionality for data center operators seeking rapid backup solutions as AI-driven loads surge. The momentum also showed in the federal sector, with the DOE finalizing a $489 million loan for Puerto Rico battery storage, projects serving over 100,000 customers in Arecibo and Santa Isabel, highlighting the growing role of batteries for both resiliency and grid balancing in islanded and mainland grids.
PPAs, interconnection, and policy drive new pathways for capacity
Underlying these project surges, new contract structures and regulatory orientation emerged as flashpoints. PSEG’s entry into PJM’s bilateral market for data center supply signaled potential for tailored, market-based contracting for large loads in New Jersey and the Mid-Atlantic. Google’s 15-year PPA with RWE for the 155 MW Crooked Creek Solar project in Oklahoma drew attention as a model for supply certainty amid interconnection backlogs. Meanwhile, PJM Interconnection accepted over 700 new generation projects totaling 200 GW for study in its first reformed cycle, while separately filing a one-time reliability auction plan at FERC to cover a 6.8 GW capacity gap driven by hyperscale demand, aiming to bring new supply online by late 2028. At the national level, a pivotal policy win came as a federal appeals court upheld FERC Order 2023, affirming authority to accelerate clean energy project interconnections across the country’s transmission grid and targeting persistent queue delays.
What this means for buyers
A week defined by mega-deals, capacity commitments, and forceful grid reforms underscored the intensifying race for reliable power and transmission access. Buyers and developers face a more dynamic procurement landscape, with bilateral markets, hybrid resource portfolios, and new FERC-backed interconnection pathways creating alternatives in congested regions. All eyes remain on Texas and Mid-Atlantic policy as capacity auctions and siting audits ripple through development timelines. Utility and data center buyers should prioritize optionality for firm power, scalable storage, and flexible contracting as grid stress and queue reform shape US dealmaking for 2026 to 2028.
