Trump Targets Billions in Energy Grants for New Round of Audits

President Donald Trump’s administration is deepening its review of more than $15 billion in grants and other support awarded by its predecessor for upgrading power grids and manufacturing energy technology.

Energy Secretary Chris Wright is ordering the stepped-up scrutiny, with a plan for case-by-case reviews to ensure projects that won funding under former President Joe Biden are financially sound, aligned with US economic and security interests and consistent with the Trump administration’s policies, according to documents seen by Bloomberg News.

The reviews will cover projects for modernizing the power grid, making batteries in the US and building other energy technology domestically. Financial support for those that don’t meet the new standards could be modified or terminated, according to a new policy statement.

Trump has been a sharp critic of what he calls the “Green New Scam,” referring to hundreds of billions of dollars in government subsidies for low- and zero-emission technology. He’s also trained heavy fire on policies buttressing offshore wind and electrical vehicles, while cheering on the use of oil, gas and coal. And Trump allies have complained that Biden’s team rushed funding out the door in its final weeks.

An initial review is focused on 179 projects that have won financial assistance from Energy Department offices focused on power grids and domestic manufacturing. But the plan also sets the stage for potentially more audits of tens of billions in additional support awarded to auto companies, power utilities, biofuel producers and other ventures.

The effort, compelling companies to supply new documentation on demand — with the risk of cancellation for not swiftly complying within 30 days — could be a powerful tool to pull back support from projects that run counter to Trump’s policy priorities.

Not only could the Energy Department withdraw funding for projects that fall short of the new standards, it is also threatening to terminate grants where recipients fail “to respond to follow-up questions in a timely manner” or provide “incomplete responses.” In those instances, the department may treat “the recipient’s refusal to cooperate as grounds for termination of the award or the withholding of funding,” the policy says.

The new policy is “essential to identifying and avoiding fraud, waste and abuse,” according to the energy secretary’s order.

“With this process, the Department will ensure we are doing our due diligence, utilizing taxpayer dollars to generate the largest possible benefit to the American people and safeguarding our national security,” Wright said in a statement.

IRA Funds

The Energy Department has already been reviewing grants, loan guarantees and other financial contracts awarded under Biden, including billions supplied by the climate-focused Inflation Reduction Act and bipartisan infrastructure law.

After Trump was elected, the Biden administration intensified efforts to ink conditional awards and get money out the door, including billions of dollars worth of loan guarantees for hydrogen developer Plug Power Inc., electric truck maker Rivian Automotive Inc., utility PG&E Corp., and other companies.

Some Republican lawmakers also have questioned support for battery and solar manufacturing ventures with ties to China, which could trigger national security scrutiny under the new standards. Budget legislation advancing in the House of Representatives would limit projects with ties to China and others designated “foreign entities of concern” from receiving clean energy manufacturing tax credits.

Trump administration officials and Republican allies derided the Biden administration’s race to cut checks, saying it may have short-circuited routine financial reviews and assessments, steering support to undeserving companies.

Biden administration officials had defended their efforts, saying awards were made after normal financial assessments and scrutiny. Project developers argue that yanking previously issued or contracted funding creates uncertainty that could scare off investors.

The new Energy Department effort will effectively increase scrutiny, with requests for additional information meant to inform analysis of whether projects meet the newly specified standards. “Large, complex awards” and groups of homogeneous awards are most likely to be singled out for assessment, according to the policy statement.

The initial review will focus on 102 awards worth $8.4 billion from the Energy Department’s Grid Deployment Office and another 77 projects that secured $7.3 billion in support from the agency’s Office of Manufacturing and Energy Supply Chains.

More than $9 billion of the funds set for review under the initiative were awarded between Election Day in November and Trump’s inauguration on Jan. 20.

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