U.S. to Scrap $13 Billion in Green Energy Funds, Sparks Backlash

The U.S. Department of Energy announced Wednesday it plans to cancel more than $13 billion in subsidies pledged under the Biden administration to support wind, solar, battery storage, and electric vehicles. Officials framed the move as a return of taxpayer dollars, saying it reflects the Trump administration’s focus on “affordable, reliable, and secure” domestic energy production.

The decision drew immediate criticism, most notably from California Governor Gavin Newsom, who warned the U.S. was ceding clean energy leadership to China. “President Xi … I think he’s going to give Trump a bear hug when he arrives,” Newsom quipped at a climate event.

The announcement came just a day after President Trump dismissed climate change at the United Nations as “the greatest con job,” while touting record oil and gas production. Energy Secretary Chris Wright defended the cuts, arguing climate spending has produced “very little positive impact.”

The rollback comes despite data showing U.S. clean energy jobs grew three times faster than the broader workforce in 2024. Critics warn the funding cuts could stall this momentum and weaken U.S. competitiveness in renewable technologies.

The $13 billion rescission is significant not just for its immediate scale but for the signal it sends to project developers, manufacturers and their financiers about the reliability of federal clean-energy commitments. Cancellations of committed grants create real cash-flow gaps for projects in development and undermine investment cases that were built on the assumption of stable federal support.

The tension between federal rollback and continued underlying market fundamentals - solar-plus-storage supplying 82 percent of new capacity, clean-energy jobs growing three times faster than the broader workforce - reflects a persistent US pattern of state and market forces continuing to drive transition even where federal policy shifts against it. But the drag on pace, cost and international competitiveness is real, particularly against Chinese manufacturing and deployment scale.

For US-focused clean-energy developers, manufacturers, investors and their international competitors, Cognitud's market intelligence, responsible investment and climate action teams help clients build scenario-based strategy across federal-policy trajectories, structure portfolios that reflect the resilience of state-level economics, and prepare disclosures that translate a volatile US policy environment into decision-useful risk narratives for lenders and capital providers.