Green Energy — News & Analysis

Appeals court blocks EPA from canceling $20B climate grant program (August 5, 2026)

Tribal Business News reports that a federal appeals court has left standing a lower-court order barring the Environmental Protection Agency from canceling $20 billion in clean energy grants or reclaiming money already disbursed. Roughly $1.5 billion of that total was expected to support tribal and Native-serving projects. The awards were made through the Greenhouse Gas Reduction Fund, a financing program established by the Inflation Reduction Act. EPA froze the funding in early 2025 and subsequently moved to terminate the grants outright; the money has stayed frozen as the litigation proceeded. In a decision issued Tuesday, the U.S. Court of Appeals for the District of Columbia Circuit found that EPA had likely violated the Inflation Reduction Act by terminating the awards and attempting a clawback grounded solely in a policy disagreement. Six judges concluded the agency had likely exceeded its authority, and the court observed that EPA had not demonstrated it would refrain from repeating those actions were the injunction lifted.

The ruling resolves the injunction question without resolving the case. The judges divided evenly on the broader legal issues, among them whether the One Big Beautiful Bill Act altered the status of grants that had already been awarded before that law took effect. That split leaves the remainder of the district court's injunction intact while the suit returns to federal district court for further proceedings. Climate United, the lead plaintiff, said the decision confirms that EPA acted unlawfully, maintaining that no legal basis exists for terminating its award or recovering funds already deposited in its accounts, and describing the program as designed to reduce energy costs, generate jobs and improve public health. The organization said it would keep pursuing every available avenue to unfreeze the money on behalf of the communities it serves.

Court document: U.S. Court of Appeals for the D.C. Circuit, No. 25-5122, judgment (PDF)