A federal appeals court ruled that the Environmental Protection Agency cannot suspend $20 billion in clean energy grants issued to green groups during the Biden administration.
The U.S. Court of Appeals in Washington, D.C., on Tuesday issued a decision to restore District Judge Tanya Chutkan’s April 2025 preliminary injunction that prevented the EPA from “unlawfully suspending or terminating” billions of dollars in grants from the Greenhouse Gas Reduction Fund.
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The Greenhouse Gas Reduction Fund distributed $20 billion of those funds to eight nonprofit organizations for clean energy projects across the country. The fund was established through the Biden administration’s Inflation Reduction Act.
Last year, the EPA froze the grants and attempted to terminate them, arguing that the Biden administration improperly distributed them by routing them through Citibank. The agency was quickly met with litigation from three climate grantees: Climate United, Coalition for Green Capital, and Power Forward Communities.
“Today, the DC Circuit Court judges affirmed what we have always known: EPA took actions to unlawfully freeze and dismantle the National Clean Investment Fund grant program,” Climate United said in a statement.
“Despite efforts to harm the awardees with false allegations and misinformation, there remains no legal basis for terminating our grant award and clawing back funds that were already disbursed in our bank accounts,” they wrote.
EPA Administrator Lee Zeldin has called the funds “gold bars,” referencing a video filmed last year in which a former EPA employee said the Biden administration was attempting to disburse funds as quickly as possible before the end of the term. “It truly feels like we’re on the Titanic, and we’re throwing like gold bars off the edge,” the former employee says in the video.
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Six of the 10 panel judges agreed that the EPA likely violated the law when it sought to terminate the grants and claw back funds that were already distributed “based solely on a policy disagreement.”
The EPA could appeal to the Supreme Court.
The Greenhouse Gas Reduction Fund was given a total of $27 billion but divided the funds into three programs, which distributed $7 billion to Solar for All, $14 billion to the National Clean Investment Fund, and $6 billion to the Clean Communities Investment Accelerator. The EPA has also sought to cut funding for the Solar for All program.
