Michigan fights loss of $156M in low-income solar funding

LANSING, MI — Michigan and 20 other states are suing the Trump administration over its termination of a $7 billion federal program aimed at helping low-income households install rooftop solar panels.

The blue state coalition is suing the U.S. Environmental Protection Agency and administrator Lee Zeldin, whom they claim unlawfully canceled the Solar for All program in violation of the Administrative Procedures Act and the Constitution’s separation of powers.

A parallel lawsuit in the U.S. Court of Federal Claims seeks monetary damages for what the states call an illegal breach of grant contracts.

In August, the EPA rescinded a $156 million Michigan grant that was awarded under the Biden administration.

The lawsuits were announced Friday, Oct. 17.

Michigan Attorney General Dana Nessel called the grant rescission “deeply harmful” to Michigan residents.

“We’ve seen this playbook from the White House before,” Nessel said. “The administration has tried to pull the same stunt by canceling congressionally mandated programs, and we stopped them then,” she said. “We plan to do the same now to ensure the Trump administration cannot unlawfully strip away these important investments that lower energy costs and make clean energy more accessible to Michigan families.”

Congress created the Solar for All program under the Inflation Reduction Act of 2022, directing the EPA to distribute competitive grants to expand solar energy access in disadvantaged communities. The agency awarded all funds by August 2024.

The Trump administration terminated the entire program this summer, citing a new law — the One Big Beautiful Bill Act — as repealing the Inflation Reduction Act’s funding authority.

The rollback is part of a broader effort by the Trump White House to terminate previously approved federal grants that were meant to stimulate renewable energy generation and reduce energy production from climate-warming fossil fuels.

The Michigan Department of Environment, Great Lakes and Energy (EGLE) had already announced 13 pilot projects before the cutoff, including solar installations on senior housing, municipal facilities, and low-income homes from Detroit to the Upper Peninsula.

State officials said the program was expected to create about 700 jobs and save some households an average of $400 annually on electric bills.

“You’re both getting direct utility cost savings into the hands of low-income households, but you’re also helping to bolster a whole ecosystem of people that do this kind of work,” EGLE director Phill Roos said in August. “There’s a lot of multiplier benefits.”

Michigan moved forward with its Solar for All program this spring after the money was released from a sweeping freeze on federal grants in February. The first round of projects was announced in July and the second in August.

The EPA directed states to return any unobligated funds and said some allowable costs incurred to date could be reimbursed.

Plaintiff states include Arizona, California, Colorado, Connecticut, Hawaii, Illinois, Massachusetts, Maine, Maryland, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Rhode Island, Vermont and Washington. Also joining the complaint are the District of Columbia and governors of Kentucky and Pennsylvania, as well as the Wisconsin Economic Development Corporation.