Trump is funding climate projects in red states but canceling them in California, lawsuit charges

The Trump administration is withholding billions of dollars in federal funds for energy-saving programs in blue states while funding similar projects in red states, California and other Democratic-led states charged in a lawsuit Wednesday.

The suit, filed in federal court in San Francisco, cited an announcement last October by President Donald Trump’s budget director, Russell Vought, that the government was cutting off “Green New Scam funding to fuel the Left’s climate agenda” for more than a dozen states, none of which had voted for Trump in 2024.

This was “an unlawful decision to terminate congressionally mandated clean energy funding, approved by bipartisan majorities,” California Attorney General Rob Bonta said at a news conference announcing the lawsuit. 

Congress is constitutionally authorized to approve federal funding, Bonta said, and the president has no authority to cancel appropriations to states “just because he disagrees with them.” And the result, he said, will be lower paychecks, higher energy bills and “toxic air.”

Or as Colorado Attorney General Phil Weiser said at the news conference, “Who you voted for in a presidential election is not a basis to withhold money.”

The suit challenges cancellation of $2.7 billion in federal grants to 13 states, including $1.2 billion to California for development of clean hydrogen as an alternative to oil and gas for public transportation, heavy-duty trucking and seaport operations.

The White House did not immediately respond to a request for comment.

The funds to California would have triggered $9.3 billion in private matching funds and another $1.7 billion in state and local funding, the suit said. Because of the cutoff, it said, a California public-private program called Alliance for Renewable Clean Hydrogen Energy Systems, or ARCHES, had to lay off its staff, who are now working as volunteers.

Trump has promoted oil and gas production and rejected efforts to limit global warming by increasing the use of windmills and solar power. The lawsuit cited those policies while also asserting that the administration has acknowledged political motives.

In a previous case, Trump’s Justice Department “conceded that the political identity of a terminated grantee’s state, including the fact that the state supported Vice President Kamala Harris in the 2024 election, played a preponderant role in (Vought’s) October 2025 grant termination decisions,” wrote California Deputy Attorney General Christopher Kissel, lead attorney for the 13 states. He did not describe the previous case.

But the only explanation received by any recipients of the withdrawn energy funds was that federal regulations allow “the termination of awards that no longer serve ‘program goals’ or ‘agency priorities,’” the suit said, and some were given no explanation at all.

“The Administration’s actions defy any authority given to the Executive Branch in statute and in the Constitution and unlawfully encroach on powers reserved to Congress alone,” wrote Kissel, who asked a federal judge to declare the orders illegal and restore the funding.

The other 11 states in the lawsuit are Connecticut, Illinois, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island, Vermont, Washington and Wisconsin.

This is the 58th lawsuit California has filed against Trump since the start of his second term in January 2025, and the state has recovered more than $200 billion, Bonta said. Weiser said it’s the 54th such suit for Colorado.