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- By Tribal Business News Staff
- Energy | Environment
A federal appeals court has left in place a court order that blocks stops the Environmental Protection Agency from canceling $20 billion in clean energy grants and taking back money that had already been distributed. The funding includes about $1.5 billion expected to support tribal and Native-serving projects.
The grants were awarded through the Greenhouse Gas Reduction Fund, a financing program created by the Inflation Reduction Act. The legal dispute stems from EPA’s decision to freeze the funding in early 2025 and later terminate the grants. That money has remained frozen while the case worked its way through the courts.
In a decision issued Tuesday, the U.S. Court of Appeals for the District of Columbia said EPA likely violated the Inflation Reduction Act by attempting to terminate the grants and claw back money based solely on a policy disagreement. Six judges agreed EPA had likely exceeded its authority, and the court said the agency had not shown it would refrain from taking the same actions if the injunction were lifted.
The ruling does not end the case. The judges were evenly split on broader legal questions, including whether the One Big Beautiful Bill Act changed the status of grants that had already been awarded before the law took effect. Because of that split, the remainder of the lower court's injunction stays in place while the lawsuit returns to federal district court.
Climate United, the lead plaintiff, said the ruling confirmed EPA acted unlawfully and pledged to continue seeking access to the frozen funds.
“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,” the organization wrote. “This program was designed to lower energy costs, create good jobs, and improve public health. We will continue to pursue every legal avenue available to us to unfreeze funds on behalf of the communities we serve.”
