The White House issued an emergency Executive Order last week declaring that the U.S. bulk-power system faces an "unusual and extraordinary threat" from foreign supply of electric equipment. The order prohibits the acquisition, importation, transfer, or installation of equipment that could be subverted for grid sabotage. It applies to transactions initiated after August 26, 2026, and covers transformers, inverters, battery energy storage systems, backup generators, turbines, circuit breakers, and measurement tools that interact with transmission at 69 kV or higher. Distributed energy facilities that contact only local power lines are excluded.
China is the central concern among the 24 countries designated as Covered Foreign Entities. China exported $37.4 billion worth of power equipment in 2025, including $9.3 billion in transformers alone. The U.S. still imported at least $3.5 billion in grid equipment from China last year, and closer to $10 billion when including all of Southeast Asia. No equipment is specifically prohibited until the Department of Energy determines it poses a risk to the U.S. electricity grid or national security. The DOE has until Christmas Eve to make those determinations and recommend how to isolate, monitor, or replace affected equipment.
Separately, NVIDIA-backed Emerald AI raised $150 million in an oversubscribed Series A at a $1.05 billion valuation to scale commercial deployment with AI companies, data center operators, and electric utilities. Clean energy owner and operator Avantus secured a $300 million tax equity commitment from Truist Bank for a project in Kern County, California, following more than $525 million in construction financing. The brief also notes an Aspen Power ITC deal on up to 30 projects and an EPC overcoming weather challenges at two community solar sites.
What remains unknown is whether this executive order will have more teeth than the previous, never-implemented 2020 attempt. Lenders and tax equity investors have previously drafted clauses requiring developers to cover replacement costs for equipment later deemed a threat, and many such provisions remain. The DOE's forthcoming index of pre-approved gear or licensing process could shift risk onto project stakeholders already facing disappearing tax credits, tariffs, and unclear foreign entity of concern guidance.