Appeals Court Allows Trump’s EPA to Cut $20bn in Climate Grants

The US Environmental Protection Agency (EPA) terminated Biden-era grant agreements worth $20 billion in March, on the basis that the program did not align with the agency’s priorities under the new administration.

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A US appeals court has ruled against non-profit environmental groups that had some $16 billion in climate grants frozen by the Trump administration.

The US Environmental Protection Agency (EPA) terminated grant agreements worth $20 billion back in March, on the basis that the program did not align with the agency’s priorities under the new administration. Since taking office in January, Trump has been delivering on his campaign pledge to “drill, baby drill,” undoing much of his predecessor’s environmental legacy, and steering the US away from international climate commitments.

The grant money was made available through the $27-billion Greenhouse Gas Reduction Fund created under former president Joe Biden’s Inflation Reduction Act. It was awarded in April 2024 to eight organizations, which were tasked with financing “tens of thousands” of projects ranging from home energy retrofitting to air pollution reduction.

The three-judge panel at the US Court of Appeals for the District of Columbia Circuit on Thursday overturned a lower court’s injunction temporarily requiring the EPA to resume payments. It ruled that most of the plaintiffs’ claims were contract disputes to be discussed exclusively in the Court of Federal Claims. Should the case move to the Court of Federal Claims, the five organizations that brought the case will lose any chance to reinstate the grants and will only be able to sue for damages. However, they can still appeal Tuesday’s decision, Heatmap reported.

In a statement on Tuesday, Climate United CEO Beth Baffor said she was “disappointed” by the ruling, reiterating the unlawfulness of the EPA’s decision. But he vowed to “continue to press on for communities across the country that stand to benefit from clean, abundant, and affordable energy.”

The EPA celebrated the judges’ decision, saying, “It’s fantastic to see reason prevail in the court system.”

‘Politicized’ Move

The Environmental Protection Network (EPN), a group of more than 600 former EPA employees that was formed in 2017 to protect the agency’s integrity, in March called the freeze “a significant setback” in the US’s fight against climate change and promotion of environmental justice and a deviation from the agency’s “core mission to protect human health and the environment.”

Matthew S. Tejada, EPN volunteer and former Deputy Assistant Administrator for Environmental Justice in EPA’s Office of Environmental Justice and External Civil Rights, said at the time that the grants were meant to make communities “safer, healthier and more prosperous.”

Among the eight non-profits the money was awarded to was Opportunity Finance Network (OFN), an organization that focuses on community development investment. In a statement in March, OFN said the EPA’s decision to freeze the fund impacts the “planned announcement” of over $228 million in initial grants to 26 organizations to fund housing, distributed energy, and transportation infrastructure initiatives across over 30 states.

OFN also said the EPA’s decision is based on “inaccurate and politicized claims” that are “baseless and undermine a critical effort to drive American energy independence, local resilience, and job creation in communities.”

Other grantees included the Coalition for Green Capital, Climate United Fund, Power Forward Communities, Opportunity Finance Network, Inclusiv and the Justice Climate Fund.

“Those who have already paid the highest price for pollution, through their health and their children’s future, are the first to be sacrificed by Trump’s EPA. But, they will not be the last. Every American should be concerned about what this means for our future,” said Tejada.

Featured image: Wikimedia Commons.

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