Key facts
- A U.S. appeals court ruled the EPA cannot block $20 billion in clean energy grants.
- The funds were awarded during the Biden administration and frozen early in President Trump's second term.
- The Trump administration's attempt to claw back disbursed funds was deemed unlawful by the court.
- The Greenhouse Gas Reduction Fund, a $20 billion program, was intended to spur clean energy development.
- Nonprofits involved have faced significant cuts while their accounts were frozen.
A divided federal appeals court has ruled that the Trump administration improperly terminated billions of dollars in funds designated for clean energy projects, handing a victory to a coalition of nonprofits selected to manage the Biden-era initiative. The funds, totaling $20 billion, have been frozen since early in President Trump's second term.
The Greenhouse Gas Reduction Fund, often called a "green bank," is a congressionally authorized program designed to provide money to nonprofits. These organizations would then make loans and invest in small energy projects, energy-efficient buildings, and transportation.
EPA Administrator Lee Zeldin had accused the Climate United Fund and other selected nonprofits of mismanagement and potential fraud, leading him to freeze billions already placed in a Citibank account and subsequently terminate their grants. The groups denied any wrongdoing and initiated legal action, asserting that the Trump administration had violated the law and the Constitution by failing to disburse funds authorized by Congress.
The court's decision by the full U.S. Court of Appeals for the District of Columbia is a setback for the Trump administration's efforts to dismantle President Joe Biden's climate agenda. The ruling will be put on hold for several days, allowing the Environmental Protection Agency an opportunity to seek intervention from the Supreme Court.