The Trump administration has announced plans to terminate dozens of clean energy projects and freeze billions of dollars for major projects in New York, intensifying a stand-off with Democrats over a United States government shutdown.
US media outlets described the moves announced by the energy and transportation departments as part of the administration’s efforts to pressure Democrats in Congress to agree on a deal to end the shutdown.
US President Donald Trump had raced to enact hard-right policies even before the shutdown began after midnight on Tuesday, threatening mass firings and to slash government departments, and blaming Democrats for Congress’ failure to resolve a funding stand-off.
The Department of Energy announced on Thursday “the termination of 321 financial awards supporting 223 projects, resulting in a savings of approximately $7.56 billion for American taxpayers”. It said in a statement that those projects — overseen by the Office of Clean Energy Demonstrations, the Office of Energy Efficiency and Renewable Energy and other bodies — “did not adequately advance the nation’s energy needs … and would not provide a positive return on investment of taxpayer dollars”.
However, recipients of federal funding have 30 days to appeal against a termination decision, and some have already begun the process, the statement said.
It did not list the projects in question.
In a post on social media platform X, Russell Vought, who heads the powerful Office of Management and Budget, called the slashed projects “Green New Scam funding” that was used to advance “the Left’s climate agenda”.
He listed the states affected by the decision. They include California, New York and 14 others — all blue states where Trump failed to win in the 2024 presidential elections.
California Governor Gavin Newsom said the Trump administration had decided to cancel “up to $1.2bn” slated for a major hydrogen energy project, threatening tens of thousands of jobs.
“In Trump’s America, energy policy is set by the highest bidder, economics and common sense be damned,” Newsom said in a statement, vowing to keep pursuing a “clean energy strategy… no matter what DC tries to dictate.”
In New York — the home state of top Senate Democrat Chuck Schumer and House Minority Leader Hakeem Jeffries — the Department of Transportation (USDOT) announced on Wednesday it was freezing nearly $18bn in federal funding for two major infrastructure projects, the Second Avenue subway and Hudson Tunnel.
The move takes aim at diversity, equity and inclusion policies, according to the department’s statement, saying that subsidising projects with “race- and sex-based contracting requirements … is unconstitutional, counter to civil rights laws, and a waste of taxpayer resources”.
The funds would be frozen until a “quick administrative review is complete”, it said.
“Thanks to the Chuck Schumer and Hakeem Jeffries shutdown, however, USDOT’s review of New York’s unconstitutional practices will take more time,” it added, saying that the department “has been forced to furlough the civil rights staff responsible for conducting this review”.
New York Governor Kathy Hochul, a Democrat, said in a statement that halting funding for “critical infrastructure projects” was “political payback and an attack on New York”.
“Donald Trump has been clear: he is intent on using his reckless government shutdown to hurt the American people,” she said.
