Attorney General James Sues to Block Politically-Motivated Energy Funding Cuts

Trump Administration Targeted Blue States During Shutdown, Unlawfully Terminating $8 Billion in Critical Energy Grants

AG James Seeks to Restore Funding to Reduce New Yorkers’ Utility Bills, Create Jobs, and Alleviate Strain on Overburdened Energy Grid

February 18, 2026

NEW YORK – New York Attorney General Letitia James today joined a coalition of 12 other attorneys general in suing the Trump administration for unlawfully terminating billions of dollars in congressionally approved federal funding for energy and infrastructure projects across the country. In October 2025, Office of Management and Budget (OMB) Director Russ Vought tweeted that the administration was canceling “nearly $8 billion in Green New Scam funding to fuel the Left’s climate agenda.” Within days, the U.S. Department of Energy (DOE) eliminated hundreds of federal awards created and funded by Congress under the Bipartisan Infrastructure Bill and the Inflation Reduction Act. Attorney General James and the coalition argue that the administration cannot simply eliminate programs it dislikes by freezing already obligated funds and issuing sweeping, arbitrary grant terminations. They are asking the court to reverse the cuts and release the funding that states are relying on to meet rising energy needs nationwide.

“Americans from coast to coast are feeling the impacts of rising utility bills and strained energy grids,” said Attorney General James. “Instead of lowering costs and strengthening our infrastructure, this administration is actively sabotaging investments in our communities. As much as this administration may want to punish states it disagrees with, Congress holds the power of the purse. New Yorkers and all Americans deserve relief from crushing costs and confidence that their jobs will not be eliminated on a political whim.”

The Bipartisan Infrastructure Bill and Inflation Reduction Act, enacted in 2021 and 2022, respectively, included billions of dollars in funding for clean energy initiatives. Upon entering office, the Trump administration immediately began taking steps to eliminate this funding, including by creating a “kill list” of DOE grant programs it wanted to terminate. On September 30, as a federal government shutdown loomed, the president told reporters he could “do things during the shutdown that are irreversible” to strike back at Democrats, including “cutting programs that they like.” By October 3, three days into the federal government shutdown and two days after Director Vought’s tweet, the DOE had officially terminated or abandoned more than 300 awards totaling more than $7.5 billion, all in states with Democratic leadership.

The terminated grants were designed to strengthen energy infrastructure and lower consumers’ energy costs by modernizing the electric grid and improving building energy efficiency. The projects were set to create and support good-paying jobs and reduce pollution by advancing clean energy research and reducing harmful emissions. By abruptly terminating or abandoning these grants, the administration has now halted construction and research midstream, forced layoffs, and left states unable to move forward with critical infrastructure projects. In New York, DOE terminated multiple projects focused on energy efficiency, impacting efforts to improve the reliability of New York’s energy grid.

Attorney General James and the coalition allege that the White House leveraged the shutdown to punish states and make the cuts more difficult to reverse. They argue that DOE relied on a vague and opaque internal policy to justify terminating awards, and in some cases, the federal government simply stopped communicating with awardees altogether, leaving projects frozen and states unable to plan or proceed. The attorneys general argue that the administration’s actions, therefore, violate the Administrative Procedure Act and the U.S. Constitution’s separation of powers.

Attorney General James and the coalition are asking the court to halt the unlawful terminations and restore access to the funding Congress lawfully appropriated.

Joining Attorney General James in this lawsuit are the attorneys general of California, Colorado, Connecticut, Illinois, Maryland, Massachusetts, New Jersey, Oregon, Rhode Island, Vermont, Washington, and Wisconsin.