The Energy Department’s cancellation of $7.5 billion in Biden-era awards for clean energy projects is poised to cause significant job losses and disruptions, leaders of several states have said, even as internal documents suggest that the agency may be contemplating deeper cuts in the months ahead.
The agency’s termination of more than two dozen grants in New York State alone would threaten more than 1,000 jobs and nearly $500 million in investments in the state, according to figures compiled by the office of Gov. Kathy Hochul, a Democrat, and reviewed by The New York Times.
The New York figures represent the first official tally of how the funding cuts, which so far have largely targeted Democratic-led states, would affect the state and its growing clean energy sector. They come as President Trump appears to be seeking to maximize the pain of the government shutdown for his political opponents, including Senator Chuck Schumer of New York, the Democratic leader, and Representative Hakeem Jeffries of New York, the House minority leader.
At the same time, many lawmakers and companies fear that the Energy Department could soon cancel even more funding, including for projects in Republican-led states. An internal document circulating among lobbyists and lawmakers suggests that the agency is considering terminating an additional $12 billion in Biden-era awards, including funding for two large projects in Louisiana and Texas that aimed to remove carbon dioxide from the atmosphere.
Technology that removes carbon dioxide, a main driver of global warming, is supported by some oil and gas companies that want to use that captured gas to extract more crude from mature oil fields. One of the federal hubs would have been located in the Louisiana district of Representative Mike Johnson, the Republican House speaker.
The Energy Department said on Wednesday it had not made any final decisions beyond the initial $7.5 billion in cancellations announced last week.
“The department continues to conduct an individualized and thorough review of financial awards made by the previous administration,” Ben Dietderich, a spokesman for the Energy Department, wrote in an email. “No determinations have been made other than what has been previously announced. Any reporting suggesting otherwise is false.”
In New York, most of the canceled funding would have gone toward Democratic congressional districts. But some of the money would have benefited Republican districts in the blue state, including those of Representatives Nick Langworthy and Mike Lawler.
“By refusing to stand up to Trump, New York Republicans in Congress are stabbing their own constituents in the back,” Ms. Hochul said in a statement. “Instead of celebrating the opening of a local factory or congratulating a neighbor on their new six-figure job, these Congress members would rather stand idly by as Trump strips their communities of 21st century economic opportunity.”
The Energy Department had awarded more than $26 million to two companies in Mr. Lawler’s Hudson Valley district, including a company developing advanced batteries. “I’m in New York and I’m a Republican, and obviously this project cancellation impacts my district, so it’s not just Democrats getting impacted,” Mr. Lawler told CNN.
A spokesman for Mr. Lawler, Ciro Riccardi, blamed Democrats for the shutdown. “None of this would be happening if Senator Schumer and his caucus hadn’t shut down the government at the behest of Hakeem Jeffries,” he wrote in an email.
In the Central New York district of Representative John Mannion, a Democrat, a factory that makes parts for electric heat pumps may no longer pursue a $25 million expansion after the Energy Department canceled a $5 million grant to help pay for the project. The expansion of the Bitzer Scroll plant would have added a new assembly line, initially creating 20 jobs.
“The whole thing of Trump bringing jobs back to America is completely running in reverse for us,” John Allcott, vice president of North American operations for Bitzer Scroll, told the local media outlet Syracuse.com. “It’s just killing us.”
For months, political appointees at the Energy Department have been reviewing billions of dollars worth of climate and infrastructure spending that had been awarded by the Biden administration, claiming that the money was rushed out the door but providing few details about specific problems.
In recent weeks, the Energy Department sent the White House’s Office of Management and Budget a list of roughly $23 billion in funding that it had marked for potential termination, according to two people familiar with the matter who requested anonymity to describe internal documents.
The Trump administration initially chose to slash a subset of those funds, about $7.5 billion, that were largely concentrated in blue states. The cuts underscored the administration’s strategy of putting pressure on Democrats to accept a Republican budget bill and reopen the government.
“Nearly $8 billion in Green New Scam funding to fuel the Left’s climate agenda is being canceled,” Russell T. Vought, the White House budget director, wrote in a social media post last week.
Those projects include major upgrades to electrical grids in California, Minnesota and Oregon; efforts to reduce methane leaks from oil and gas operations in Colorado; and large hubs to produce clean-burning hydrogen fuels in California and the Pacific Northwest.
This week, however, a leaked list marking an additional $12 billion in potential terminations has been circulating in Washington. It indicated that funding could be canceled for dozens of projects in Republican-led states as well.
That larger list of potentially affected projects includes the five remaining clean hydrogen hubs in places like Appalachia, the Gulf Coast, the Midwest and Texas, many of which aimed to produce hydrogen from natural gas. It would also include a variety of grants for retooling automotive factories to produce electric vehicles or to recycle lithium-ion batteries.
The list of expanded targets also suggests that the Energy Department is considering axing up to $1.2 billion in awards for so-called direct air capture hubs in Louisiana and Texas. Those hubs, authorized by the 2021 bipartisan infrastructure law, aimed to test and scale up technology to remove carbon dioxide from the atmosphere.
It is uncertain whether or when the Energy Department might go through with this additional wave of cuts, and the leaked list has set off a furious lobbying battle in Washington to save projects. Some companies that would be directly affected by the cuts said they had not heard of any final decisions.
“We aren’t aware of a decision from D.O.E. and continue to productively engage with the administration in a project review,” said Vikrum Aiyer, head of global policy at Heirloom, a company working on carbon dioxide removal and a main participant in Louisiana’s direct air capture hub.
Companies or universities that receive federal awards typically sign a legally binding agreement and then spend their own money, on the expectation that they will be reimbursed by the government. Any recipients that have their funding axed could potentially sue the Energy Department, just as recipients from the Environmental Protection Agency have sued after the Trump administration canceled their grants.