Divided federal appeals court says Trump administration was wrong to terminate climate funds

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🗞️ Driving the news: A divided U.S. federal appeals court has ruled that the Trump administration improperly terminated billions of dollars in funding for clean energy projects through the Greenhouse Gas Reduction Fund (GGRF), also known as the “green bank”
• The decision is a major legal setback for the administration’s efforts to dismantle Biden-era climate programmes
• However, the ruling is temporarily paused, allowing the Environmental Protection Agency (EPA) time to seek Supreme Court intervention

🔭 The context: The GGRF was created under the 2022 Inflation Reduction Act and allocated $20 billion to nonprofit organisations that would provide financing for clean energy initiatives, including energy-efficient buildings, transportation projects and smaller renewable energy investments
• The Trump administration froze funds held for the programme and terminated grants awarded to groups including Climate United Fund, alleging mismanagement and potential fraud
• The nonprofits denied wrongdoing and argued that the administration unlawfully blocked funds already authorised by Congress
• The full U.S. Court of Appeals for the District of Columbia Circuit reversed an earlier decision by a three-judge panel, with six of ten judges finding that the EPA likely violated federal law by cancelling grants based on a policy disagreement rather than proven misconduct

🌍 Why it matters for the planet: The case highlights the legal and political uncertainty surrounding U.S. climate investment
• The GGRF was designed to channel public capital into projects that could accelerate decarbonisation, particularly for communities and businesses that struggle to access traditional financing
• A reversal of the programme could slow deployment of clean energy projects, building efficiency upgrades and low-carbon infrastructure
• The case could establish important limits on how future administrations can reverse congressionally approved climate spending

⏭️ What’s next: The EPA is expected to ask the Supreme Court to review the decision
• The final outcome could determine whether billions of dollars in clean energy financing remain available and clarify the extent of executive power over previously approved federal grants

💬 One quote: “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.” — Climate United Fund

📈 One stat: The Greenhouse Gas Reduction Fund was authorised at $20 billion under the Inflation Reduction Act to finance clean energy and climate-related projects

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