Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy

Politics

Trump’s Other Funding Freeze Attacks Environmental Justice

Companies, states, cities, and other entities with Energy Department contracts that had community benefit plans embedded in them have been ordered to stop all work.

Donald Trump.
Heatmap Illustration/Getty Images

Amidst the chaos surrounding President Trump’s pause on infrastructure and climate spending, another federal funding freeze is going very much under the radar, undermining energy and resilience projects across the U.S. and its territories.

Days after Trump took office, acting Energy Secretary Ingrid Kolb reportedly told DOE in a memo to suspend any work “requiring, using, or enforcing Community Benefit Plans, and requiring, using, or enforcing Justice40 requirements, conditions, or principles” in any loan or loan guarantee, any grant, any cost-sharing agreement or any “contracts, contract awards, or any other source of financial assistance.” The memo stipulated this would apply to “existing” awards, grants, contracts and other financial assistance, according to E&E News’ Hannah Northey, who first reported the document’s existence.

Justice40 was Biden’s signature environmental justice initiative. Community benefit plans were often used by Biden’s DOE to strengthen the potential benefits that projects could have on surrounding local economies and were seen as a vehicle for environmental justice. When we say often, we mean it: some high profile examples of these plans include those used for the Holtec Palisades nuclear plant restart in Michigan and the agency’s battery materials processing and recycling awards.

After Kolb’s edict went out, companies, states, cities, and other entities with DOE contracts that had community benefit plans embedded in them were ordered to stop all work, according to multiple letters to contract recipients reviewed by Heatmap News. “Recipients and subrecipients must cease any activities, including contracted activities, and stop incurring costs associated with DEI and CBP activities effective as of the date of this letter,” one letter reads, adding: “Costs incurred after the date of this letter will not be reimbursed.”

One such letter was posted by the University of Michigan research department in an advisory notice. The department’s website summarizes the letter as “directing the suspension” of all work tied to “any source of DOE funding” if it in any way involved “diversity, equity, and inclusion (DEI) programs,” as well as Justice40 requirements and community benefits plans.

These letters state companies and other entities with community benefit plans in their contracts or otherwise involved in their funding awards would be contacted by DOE to make “modifications” to their contracts. They only cite President Trump’s executive orders that purportedly address Diversity, Equity and Inclusion practices; they do not cite a much-debated Office of Management and Budget memo freezing all infrastructure law and Inflation Reduction Act spending, which has been challenged in federal court. It is altogether unclear if any outcome of the OMB memo litigation is even relevant to this other freeze.

We reached out to the Energy Department about these letters for comment on how many entities may be impacted and why they targeted community benefit plans. We will update this story if we hear back.

A lot is still murky about this situation. It is unclear how many entities have been impacted and the totality of the impacts may be unknown for a while, because a lot of these entities supposed to get money may want to keep fighting privately to, well, still get their money. It’s also hazy if all entities that received these letters are continuing to do any construction or preparatory work or other labor connected to their funding not tied to the community benefit planning, or just halting the funded labor altogether.

The blast radius from this freeze is hard to parse, said Matthew Tejada, a former EPA staffer who most recently served as the agency’s deputy assistant administrator for environmental justice under the Biden administration. Tejada, who now works for the advocacy group NRDC and remains connected to advocates in the environmental justice space, said he was very much aware of this separate freeze when he was first reached by Heatmap. But “unless you’re able to really have a network of information bottom up from the recipients, it’s a bit of a black box we’re operating around because we’re not going to get transparency and information from the administration.“

“Part of their obvious strategy here is to create enough confusion as possible to make defending as difficult as possible. But I’m fairly certain the community and various others here -- local governments, tribes -- will have plenty to say about cutting through that chaos to make sure the will of Congress and the outcomes of these programs and projects are delivered upon.” He believes that any attempts to modify these contract awards “on the pretext of canceling the contract[s] will in all likelihood meet a legal challenge.”

But the ripple effects of this other freeze are starting to surface in local news accounts.

According to the Erie Times-News, the city of Erie, Pennsylvania currently cannot access funding for a city-wide audit for home energy efficiency. And a big road improvement project in the Mariana Islands – a U.S. territory – was nearly derailed by the freeze, according to the news outlet Mariana’s Variety, which reported project developers are just going to try and move forward without the remaining money provided under contract.

We’ll have to wait and see the breadth of the impacts here and whether this freeze will produce its own legal or regulatory rollercoaster. Hang on tight.

Green

You’re out of free articles.

Subscribe to access Heatmap’s expert analysis of energy, climate change, and sustainability, including coverage of our regular survey research. Save $57 on an annual subscription, just $156 $99/year.
To continue reading
Create a free account or sign in to unlock more free articles.
or
Please enter an email address
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Energy

Scoop: Trump to Permit Largest-Ever Gas Project in Just 7 Months

The facility will power OpenAI’s 10-gigawatt data center in Pike County, Ohio.

Donald Trump and rubber stamps.
Heatmap Illustration/Getty Images, Library of Congress

The Trump administration aims to complete its environmental review of what would be the biggest fossil fuel power project in the country in just a few months, Heatmap has learned.

This news follows Monday’s announcement from OpenAI that it intends to lease a new 10-gigawatt data center under development in Pike County, Ohio, financed by a mixture of money from a SoftBank subsidiary and the chip company Nvidia. This AI hyperscale facility — known as the PORTS-Pike project — is expected to draw power from the largest gas power facility ever built in the United States, a 9.2-gigawatt facility sited on federal lands that would be built and owned by the Energy Department.

Keep reading...Show less
Spotlight

Data Center Moratoria Are ‘Unconstitutional,’ Lawsuits Claim

A new front opens in the data center wars.

An anti-data-center sign.
Heatmap Illustration/Getty Images

A series of lawsuits filed in federal court asks a big question – are data center moratoria constitutional?

In early August, data center developer DC Blox sued the city of Nashville in federal court to overturn a zoning moratorium stopping them from building a hyperscale facility adjacent to the city zoo. “The Data Center Moratorium, moreover, is a targeted attack against DC BLOX, in violation of federal constitutional protections,” the suit argued, claiming that it defied the corporation’s due process and equal protection rights.

Keep reading...Show less
Yellow
Hotspots

Local Permitting Fights Take Over National Politics

And more on this week’s conflicts around project development.

The United States.
Heatmap Illustration/Getty Images

1. Montgomery County, Pennsylvania – We reached a new normal in the data center backlash, and it all seems to have started in King of Prussia.

  • On Tuesday, Pennsylvania Gov. Josh Shapiro announced his state – one once coveted by the AI industry for hyperscale construction – will no longer permit projects without local support. It was a step change from posture taken mere months earlier, when he announced voluntary standards for data center development that I found may have been vetted by representatives of the industry, including Amazon.
  • Tucked in Shapiro’s speech was what I can only imagine was his last straw: developer Brian O’Neill’s efforts to construct data center buildings in the King of Prussia community, close to where he grew up himself. Without calling him out by name, the governor said he was “stoking fear in the community, even though he has no realistic path to getting power at the sites any time soon.”
  • “Here’s something else he has no realistic path to getting: my support,” the governor said.
  • As the climate news outlet DeSmog wrote earlier this month, O’Neill had closely collaborated with members of Shapiro’s administration for more than a year before this speech happened, including on securing energy. But the real estate magnate’s projects kept facing local rejections; people really don’t seem to want what he’s been selling.
  • Now Shapiro is turning on O’Neill, transforming him into what he described as a type of “speculative” developer his government wishes to discourage from building projects in his state.

2. Columbia County, Wisconsin – The gubernatorial race in this state is transforming local fights over wind projects into must-watch popcorn fodder for anyone obsessed with the state of the energy transition, or national politics for that matter.

Keep reading...Show less
Yellow