Judge temporarily bars EPA from clawing back $14B in green bank grants

A federal judge in Washington, D.C., has temporarily barred the Environmental Protection Agency (EPA) from clawing back billions of dollars given out under the Biden administration to help finance climate friendly projects.

The Trump administration sought to end the grants, which are part of a $20 billion climate program, claiming “waste, fraud and abuse.”

But Judge Tanya Chutkan, an appointee of former President Obama, found that the agency was unable to provide evidence of wrongdoing.

Specifically, she said officials offered “no specific information about such investigations, factual support for the decision, or an individualized explanation for each Plaintiff.”

“This is insufficient,” the judge added.

Chutkan ordered that the EPA’s decision to terminate the grants cannot take effect and that the agency and Citibank, which is holding the funds, can’t transfer them elsewhere. 

In a statement on the ruling posted to the social platform X, EPA Administrator Lee Zeldin vowed to continue to fight to get the money back.

“I will not rest until these hard-earned taxpayer dollars are returned to the U.S. Treasury,” he wrote.

Meanwhile, Climate United Fund, one of the groups suing for the reinstatement of its grants, called the decision a step in the “right direction.”

“Today’s decision is a strong step in the right direction. In the coming weeks, we will continue working towards a long-term solution that will allow us to invest in projects that deliver energy savings, create jobs, and boost American manufacturing in communities across the country,” CEO Beth Bafford said in a statement.

Through the 2022 Inflation Reduction Act, Congress gave the EPA $20 billion to make grants to financial institutions to help them give out cash to deploy climate-friendly projects. 

The Biden administration gave that $20 billion out to eight institutions that are tasked with dispersing it to finance projects that aim to mitigate climate change.

For weeks, Zeldin has railed against the program and said he would work with the Department of Justice (DOJ). Court filings indicate that DOJ and the FBI have launched criminal probes. 

Last week, the EPA issued contract termination notices to the eight grantees, which the judge halted late Tuesday. 

Zach Schonfeld contributed.

Updated at 12:35 p.m. EDT