Three nonprofit brokers of clean technology investment won an unequivocal, but temporary, gain in their tug-of-war with the U.S. Environmental Protection Agency (EPA) over whether the agency can claw back grants it previously issued them.
The biggest recipient among the nonprofit plaintiffs trying to block the EPA from withholding their clean energy grants said it now will seek an injunction to make the temporary action indefinite and to give them access to the funds as court action unfolds over coming months.
Climate United, and possibly the two other plaintiffs, will immediately seek the injunction on EPA action to move many solar and other clean energy projects forward out of federally induced limbo, said Brooke Durham, the agency’s communications director.
Its move would come in response to a court ruling Tuesday that kept $14 billion in funding for the nonprofits’ grants in Citibank accounts, though not within their grasp.
The EPA alleges the grants awarded to three climate groups under the Greenhouse Gas Reduction Fund were mishandled, and it has serious concerns about the program’s integrity, award process, fraud, waste and abuse.
In the restraining order issued against the EPA Tuesday, U.S. District Court Judge Tanya S. Chutkan said the EPA failed to back up its charges for terminating the grants. The judge is best-known for presiding over a now-dismissed case against President Donald Trump for his alleged role in trying to overturn the 2020 presidential election.
In her ruling, Chutkan dismissed the EPA’s charges as unpersuasively “vague and unsubstantiated assertions” and therefore unwarranted under the agency’s charter and bylaws.
“The government can’t just void contracts and void agreements and terminate things without following its own regulation,” the judge said during a hearing, according to The Washington Post.
The EPA froze the grant deposits on Feb. 18, then terminated the grants on March 12. The nonprofits said the moves not only jeopardized the projects’ public benefits, including jobs and clean energy, but also forced the nonprofits to juggle how to cover bills and pay staff.
Yet, in the wake of Chutkan’s decision, plaintiffs Climate United, Coalition for Green Capital and Power Forward Communities Inc.–which received about $7 billion, $5 billion and $2 billion grants, respectively–will continue to fight for the the program’s viability, but at least for now without access to the funds. The court ruling gives neither the grant recipients nor the federal government the power to withdraw or relocate money in the Citibank accounts.
The Greenhouse Gas Reduction Fund, commonly referred to as a “green bank” came to life through the Inflation Reduction Act of 2022. Congress allocated $27 billion for the fund, with which the EPA issued more than $20 billion in grants. The three plaintiffs have been awarded a total of $14 billion of that sum.
Beth Bafford, chief executive officer of Climate United, a coalition composed of the nonprofits Calvert Impact, Communication Preservation Corp. and Self-Help, issued a statement calling Chutkan’s ruling “a strong step in the right direction.”
“In the coming weeks,” Bafford said, “we will continue working towards a long-term solution that will allow us to invest in projects that deliver energy savings, create jobs, and boost American manufacturing in communities across the country.”
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