Currents Ep334: Renewables Development in a Demand-Driven Market
Host: Todd Alexander (Norton Rose Fulbright)
Guest: Jim Spencer (President & CEO, Excess Renewables North America)
Date: February 12, 2026
Episode Overview
This episode centers on the shifting landscape for renewable energy development in the US, focusing primarily on how increasing demand—particularly from data centers and digital infrastructure—is outpacing regulatory support as the chief driver of the market. Jim Spencer shares insights from Excess Renewables' recent $400 million corporate debt facility closing, discusses evolving funding structures, grid and supply chain challenges, and the pivotal role of batteries and hybrid projects. The discussion offers a candid look at both the opportunities and constraints renewable developers face today.
Key Discussion Points & Insights
1. Success of Excess Renewables' Corporate Debt Raise
[00:36 – 01:45]
- Deal Details:
- Initial target: $250 million; closed at $400 million.
- Deal included a lead lender group and two junior lenders with no significant syndication risk.
- Market Sentiment:
- The transaction was "very, very successful," indicating strong lender confidence despite sector headwinds.
Notable quote:
“We went out hoping to raise 250 million. We ended up raising 400 million…from our perspective, it was a very, very successful transaction.”
— Jim Spencer, [01:08]
2. Shift Toward Corporate-Level Debt Facilities
[01:45 – 03:04]
- Structure Rationale:
- Facility included letters of credit, working capital, and equipment financing for projects not yet mature enough for traditional project financing.
- Used to fund “grandfathered equipment” and projects early in their development cycle.
- Market Trend:
- Such facilities are increasingly common but available mostly to strong developers with proven track records.
3. Demand Now Outpaces Regulation as Market Driver
[03:04 – 04:34]
- Fundamental Change:
- Demand—especially from utility-scale wind, solar, and storage—is unprecedented, “replacing any lack of regulatory support.”
- Transition from regulation-driven market to demand-driven market, especially due to digital infrastructure needs.
Notable quote:
“Demand has replaced any lack of regulatory support that we may have seen in the past. In my world, I’d much rather have our business being demand driven than…by regulatory factors.”
— Jim Spencer, [03:50]
4. Surging Power Demand & Grid Challenges
[04:34 – 07:27]
- Concentrated Large Loads:
- Spike in power demand driven by data centers, not evenly spread but concentrated in specific regions.
- Existing regulatory planning models (RTOs) are ill-equipped for these sudden, geographically concentrated surges.
- Supply-Demand Mismatch:
- The industry cannot meet all demand at present, leading to possible delayed retirements of conventional power assets and reconsideration of recommissioning some nuclear plants.
5. Strategies to Reduce Bottlenecks and Adapt
[07:27 – 09:08]
- Grid Connection:
- Growing interest in “bring your own load” solutions—building behind-the-meter generation to serve large users until the grid can accommodate.
- Behind-the-meter generation is particularly appealing for data centers desiring grid backup but facing grid interconnection limits.
6. Renewables' Evolving Role in the Mix
[09:08 – 11:53]
- Hybrid Solutions:
- Purely renewable solutions currently can’t meet 24/7 high-reliability needs of data centers alone; most behind-the-meter setups will require a mix of renewables, batteries, and often natural gas.
- Development Approach:
- Site selection now considers proximity to gas infrastructure—a shift from previous all-renewable paradigms.
Notable quote:
“…Today, when we’re developing a site…Is there gas nearby that we can also bring onto the site and supplement the renewable energy…? That’s going to be a trend that is going to be pursued by ourselves and most of our competitors.”
— Jim Spencer, [10:53]
7. Role & Integration of Battery Energy Storage
[11:53 – 13:24]
- Growth Area:
- Batteries are “playing an increasingly large role” in firming renewable supply for high-demand users.
- Every new solar project Excess develops considers integration of battery storage; similar strategy for wind projects in the near future.
Notable quote:
“We are providing that we have the ability to add storage because we think it’s going to be…a part of almost every project going forward.”
— Jim Spencer, [12:27]
8. Future Prospects for Wind vs. Solar
[13:24 – 15:57]
- Wind Prospects:
- Plans for new wind developments and “repowering”—upgrading old wind farms to double efficiency and capacity without major new land disturbance.
- Solar vs. Wind:
- Solar is easier to develop; wind offers greater scale. Repowering existing wind facilities is one of the fastest ways to increase capacity.
9. Rising Power Prices & Input Costs
[15:57 – 20:09]
- Significant Increases:
- Wholesale prices have risen by 30–35% in 12–18 months, due to tariffs, supply chain bottlenecks, grid infrastructure underinvestment, and increased natural gas prices.
- Concentrated Demand:
- Underinvestment in grid exacerbated by the intense, localized loads from data centers.
- Grid Upgrades:
- Recent capital improvements have often targeted disaster mitigation, not expansion, straining capacity further.
10. Today's Top Challenges vs. Past
[20:09 – 23:51]
- Biggest Current Hurdles:
- Grid connection and power evacuation are “as difficult as it’s ever been.”
- Supply chain issues leading to long waits for key components (100–150 weeks for major gear).
- US capacity and supply constraints push up costs and delay projects.
- Regulatory headwinds (“anti-renewable sentiment”) are a lesser challenge thanks to high demand.
Notable quote:
“…The grid is more problematic. I would put the grid and getting the ability to evacuate…power into the system as probably as difficult as it’s ever been…Supply chain is also a problem…”
— Jim Spencer, [20:39]
11. Growth Plans Enabled by New Capital
[23:51 – 25:34]
- Aggressive Pipeline:
- Excess plans to build 12 projects next year (“a lot for a company our size”) and expects to upsize their debt facility again soon.
- New capital will enable 1–1.2 GW of new capacity and help cycle project debt as developments come online.
Notable quote:
“We have a huge pipeline. We…are attempting to build 12 projects next year, which for a company our size is a lot…the demand…isn’t letting up.”
— Jim Spencer, [24:15]
Memorable Quotes
-
On market transformation:
“In my world, I’d much rather have our business being demand driven than being driven by regulatory factors, which was really…the situation with renewables for a long time.”
— Jim Spencer, [03:50] -
On challenges and optimism:
“…One would think that it’s kind of an anti renewable sentiment in Washington…your biggest concern? Quite frankly it isn’t…The renewal sentiment is probably fourth on my list anyway of problems confronting us. And the reason for that is demand.”
— Jim Spencer, [22:46] -
On industry growth:
“It’s a good position to be in. We’re pretty happy with the results…It’s been a really good development for the company.”
— Jim Spencer, [25:25]
Key Timestamps
- Debt Facility Overview: [00:36 – 01:45]
- Why Corporate Debt vs. Project Debt: [01:45 – 03:04]
- Demand Beats Regulatory Support: [03:04 – 04:34]
- New Demand Drivers, Data Centers: [04:34 – 07:27]
- Easing Grid Constraints and 'Bring Your Own Load': [07:27 – 09:08]
- Behind vs. In Front of the Meter for Data Centers: [09:08 – 11:53]
- Battery Storage Role: [11:53 – 13:24]
- Outlook for Wind/Solar and Repowering: [13:24 – 15:57]
- Rising Power Prices/Costs: [15:57 – 20:09]
- Top Challenges Today vs. 15 Years Ago: [20:09 – 23:51]
- Impact of New Capital & Growth Pipeline: [23:51 – 25:34]
Tone and Style
The conversation is candid, businesslike, and analytical, peppered with technical details yet accessible to listeners interested in the strategic realities of energy infrastructure development. Jim’s insights reflect optimism bolstered by market opportunities, while remaining clear-eyed about operational constraints and industry headwinds.