DOE Floats New Cuts To Hundreds Of Clean Energy Grants

The Department of Energy is proposing major new cuts to hydrogen and air capture hubs.

The Department of Energy is planning to cancel hundreds of additional clean energy grants authorized in the Biden administration, including the five remaining federally funded hydrogen hubs and two direct air capture projects, according to a list obtained by POLITICO’s E&E News that is circulating among lobbyists and Capitol Hill staff.

The compendium marks more than 600 grants totaling more than $20 billion as “terminate.” It appears to include all of the more than 300 grants canceled last week.

“I understand this is the full list that was sent to Office of Management and Budget a few weeks ago,” said an energy lobbyist granted anonymity to speak freely. “Last week, they basically just pulled out most, if not all, the blue state projects, and that’s what they announced as cuts.”

“It shows the much bigger list, which will definitely impact a lot more states, … a lot more red states and red districts,” the lobbyist said.

Seven people familiar with internal operations at DOE confirmed the authenticity of the list, which also includes two dozen grants canceled earlier in the year.

DOE has not confirmed the list, and it’s unclear if the cancellations are final.

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“The Department continues to conduct an individualized and thorough review of financial awards made by the previous administration,” DOE spokesperson Ben Dietderich said in a statement. “No determinations have been made other than what has been previously announced.”

Last week, spurred on by an announcement from OMB Director Russ Vought, DOE scrapped $7.56 billion in financial awards, including for two hydrogen hubs on the West Coast and nearly half of the direct air capture awards approved by the Biden administration. Vought’s announcement noted states where the projects were located, all of which voted for Democratic candidate Kamala Harris in last year’s presidential election.

The new list includes more than $4.5 billion in canceled funding for the other five hydrogen hubs authorized by DOE under Biden. Those are the HyVelocity hub in the Gulf Coast; the Midwestern and mid-Atlantic hubs; an Appalachian hub known as ARCH2; and the Heartland hub in the Dakotas, Montana, Wisconsin and Minnesota, which had backing from Interior Secretary Doug Burgum when he was governor of North Dakota before joining the Trump administration.

The hubs were intended to demonstrate production and transport of clean fuel around the country with funding from the 2021 Bipartisan Infrastructure Law.

Unlike the nixed funding last week, the cancellations on the new list include hydrogen projects focused on natural gas tied to carbon capture that were backed by some Republicans. The Appalachian hub, for example, is backed by Sen. Shelley Moore Capito (R-W.Va.).

Most of the hubs did not respond to requests for comment, but the Midwest hub — which was allocated $1 billion — said it has not received a notice of canceled funding.

The hydrogen developments were funded by DOE’s Office of Clean Energy Demonstrations, a new branch of the department that was launched by the 2021 bipartisan infrastructure law and has since drawn the ire of Republicans.

The new terminations list also includes both of the largest direct air capture hub awards. The potential loss of some $500 million in matching funds for each hub could put at risk the developments by Occidental Petroleum in Texas and a Battelle-led consortium in the Louisiana congressional district of Republican House Speaker Mike Johnson.

Occidental and Battelle didn’t immediately respond to requests for comment.

The $3.5 billion direct air capture hub program was intended to jump-start a domestic industry capable of vacuuming carbon dioxide from the sky. To avoid the worst impacts of climate change, scientists have concluded that the world will need to massively increase the deployment of direct air capture and other carbon removal technologies while also rapidly reducing new emissions from oil, gas and coal.

Trade associations representing the carbon removal industry slammed the Trump administration’s potential move to cut off funding for the Texas and Louisiana hubs, which would each be the world’s largest direct air capture projects.

The apparent decision would enable “other countries to take up leadership of the industry, and claim the job creation and economic benefits of carbon removal,” the Carbon Business Council and Carbon Removal Alliance said in a joint statement.

Following the cancellations last week, Wright said more would be coming.

“As this fall goes on, you’ll see cancellations in red and blue states,” he told CNN. “We’ve got to save Americans money.”

The cuts last week targeted Democratic states but also hit some Republican House districts. The more expansive list would make major cuts to Republican states and districts, including through the hydrogen hub cancellations.

“The question is whether or not those red state projects are ‘safe,’ or if they’re just delaying killing the red state projects until after the budget fight is over,” said one energy lobbyist, granted anonymity to speak freely.

The Southern States Energy Board, which is composed largely of Republican states, would get hit with $100 million in grant cancellations, according to the list.

The new list also includes dozens of new cancellations for grants issued by the Grid Deployment Office, which aims to boost the U.S. electricity grid, and the Office of Manufacturing and Energy Supply Chains, which funds new mineral projects. Grid expansion