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Here’s why Trump’s funding freeze created so much chaos.

A memo issued to federal agencies from the White House budget office on Monday landed like an atom bomb. The Trump administration ordered a pause on the obligation or disbursement of federal financial assistance. In laymen’s terms, that means an immediate freeze on payouts of federal grants — even those already awarded. The news sent a mushroom cloud of confusion and fear through state and local governments, schools, nonprofits, and companies that have set up programs and financed projects based on that funding.
Experts say the move is illegal and many groups moved quickly to sue. By Tuesday afternoon, a federal judge had temporarily blocked the funding freeze.
A 1974 law called the Impoundment Control Act prohibits the president from holding back congressionally appropriated funds indefinitely without permission from Congress. As Georgetown University law professor David Super explained in a blog post today, the law also prohibits presidents from deferring funds based on policy disagreements. The memo from the Office of Management and Budget makes Trump’s policy intent explicit — it specifically directs agency heads to pause activities that “may be implicated by the executive orders, including, but not limited to … DEI, woke gender ideology, and the green new deal.” It notes that the pause “will provide the Administration time to review agency programs and determine the best uses of the funding for those programs consistent with the law and the President’s priorities.”
Some have interpreted the memo as the first salvo in an attack on the separation of powers. But perhaps the most immediate reason the pause is so cataclysmic is because of the way federal grants work.
When an entity wins federal funds, be it $270 million to expand a copper recycling facility in Kentucky, or $1.2 billion to build a hydrogen hub on the Gulf Coast, or $149 million for the state of Wisconsin to set up home energy efficiency rebate programs, the awardee doesn’t just get the money transferred over to their bank account in a lump sum. Every federal grant program works slightly differently, but the majority of them are essentially pay-as-you-go.
The first thing that happens after an agency awards a grant to a given project is the two parties negotiate a contract, outlining the terms under which the award will be administered. What milestones does the project need to hit? What does the recipient need to report back to the agency? In the context of many Department of Energy programs, this contract is called a cooperative agreement, where federal staff continue to be involved in the project throughout its implementation.
After both parties sign the agreement, the money is considered “obligated,” which means the government has a legal duty to disburse those funds per the terms of the agreement. There might be some initial transfer of funds at this point to kickstart the project, depending on the program and contract. But the recipient may not get any money at all until they submit for reimbursement.
Yep, that’s right. If you win millions of dollars from the government, you still need to submit your receipts to get paid.
This is typically not a one-and-done process. A lot of grant programs fund years-long projects, and recipients regularly invoice the government for reimbursement throughout that time. In the case of the DOE, most programs also have a cost-share requirement, where the agency will reimburse a project developer for whatever portion of the expenses it has agreed to pay. For the Inflation Reduction Act’s Home Energy Rebates, where the funding is distributed to states to implement their own programs, the program is set up to transfer funds to state energy offices in four “tranches” as recipients hit certain benchmarks.
While some projects are fully obligated up front, meaning the grantee is entitled to the full amount, others are obligated in phases. For example, the Department of Energy has selected seven regional hydrogen hubs to receive up to $7 billion. But each of those seven hubs has only been awarded a portion of the funding for “phase 1,” which can be used to pay for “initial planning, design, and community and labor engagement activities.” When they are ready to move into phase 2, they’ll have to negotiate a new award for project development, permitting, and financing. Each advancement is subject to a go/no-go decision by the DOE.
Before Biden left office, his administration said it had obligated 85% of all grants from the Inflation Reduction Act. But as you can see, most of that money is not yet out the door.
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Congress is motivated to pass a bipartisan deal, but Democrats are demanding limits on executive power.
A big bipartisan permitting reform deal may be in the offing in Washington. But getting it done will require taking away one of Donald Trump’s favorite toys: The power to mess with solar and wind permits.
Last week the House Natural Resources Committee advanced the SPEED Act, a bill introduced by Republican committee chair Bruce Westerman, that would put the full weight of Congress behind the federal permitting process. There’s a lot in this bill for energy developers of all stripes to like — and a lot for environmental activists to loathe, including a 150-day statute of limitations on litigation, language enforcing shorter deadlines for reviews under the National Environmental Policy Act (also known as NEPA), and a requirement that final approvals be released within 30 days of said review’s completion.
But this bill will mean nothing for the renewables industry if the Trump administration continues to dawdle on the kinds of routine governmental actions necessary to move any infrastructure project forward.
Since the start of Trump’s latest turn in office, officials have woven a paralytic web of bureaucratic hold-ups that make it next to impossible for a solar or wind energy project to get federal permits for construction activities. Meanwhile the SPEED Act, like NEPA, is essentially a process statute at this point — it deals with the boundaries within which environmental reviews are conducted. Without requiring the government to process any project regardless of whether it’s a renewable energy project or a new coal plant, Trump officials could easily produce endless delays and remain inside the letter of the law.
This is why Representative Jared Golden, a retiring moderate Democrat from Maine, pushed to add language to the SPEED Act that blocks any president from rescinding a permit after its approval. In theory, this would insulate offshore wind projects from losing even more permits (see: SouthCoast Wind, Atlantic Shores).
The bill — including the restriction on executive power — passed the House Natural Resources Committee on a bipartisan 25 to 18 vote, though only two Democrats voted in favor.
For lawmakers on both sides of the aisle, energy bill inflation and data center drama have created serious momentum for getting bipartisan permitting legislation done ahead of the 2026 midterm elections. The SPEED Act would more easily serve that need with stronger language addressing executive permitting powers, according to numerous interviews with Democratic lawmakers, D.C. policy wonks, and energy lobbyists.
“Any deal hinges on the Trump administration providing assurances they’re not going to kill every single clean energy project in existence,” Representative Mike Levin told me on Tuesday.
Levin, a California Democrat who is involved in permitting talks, said that an ideal fix for Democrats would be a proposal he co-authored with Democratic Representative Sean Casten that would require “parity” in the permitting process between fossil and non-fossil projects of all kinds. This language would explicitly require the Interior Secretary to ensure that project applications, authorizations, and approvals needed for wind, solar, battery storage, and transmission projects are “not subject to more restrictive or burdensome procedural requirements than those applied to oil, gas or coal projects.” It would also mandate that the department rescind any existing policies that violate this “parity” requirement.
“We’re going to need language in any bill that would provide certainty that all these projects permitted would be allowed to proceed, that permits will be honored, that in the future more permits will be granted. And I do not trust this administration to honor that without concrete language in the bill,” Levin told me.
Levin’s colleagues in the House echoed those sentiments. House Natural Resources Committee ranking member Jared Huffman told me that he’s hearing from representatives of the clean power sector who are “actually aligned” with environmentalists that “all of this is completely academic if you don’t release the hostage.” Representative Paul Tonko, ranking member on the House Energy and Commerce environment subcommittee, told me in a statement that “for any permitting reform negotiations to move forward, the least we need are guarantees that whatever comes of an agreement will have the force of law and will be followed by this Administration.”
Public reactions to the SPEED Act from the renewable industry have ranged from warily cheerful to notably silent, in a way that rings somewhat political, in a way that has discernible political undertones. American Clean Power, a major energy sector trade association, and the American Council on Renewable Energy, otherwise known as ACORE, have carefully applauded the bill’s advancement while also emphasizing the need for bipartisan compromise. The Solar Energy Industries Association has yet to endorse the bill, and Rachel Skaar, a spokesperson for the group, told me it is “currently reviewing the language that passed out of committee.”
These complaints won’t mean much in the full House — Republicans can pass this bill without any votes from the opposing party. But this degree of party-wide consternation almost always translates to a filibuster in the Senate. It’s hard to imagine Senators Martin Heinrich and Sheldon Whitehouse, the top Democrats on the two main Senate committees overseeing permits, trying to roll this solid bloc of colleagues. And while enough Senate Democrats broke with the party leadership to break the filibuster and reopen the government earlier this month, two of those were Senators Catherine Cortez-Masto and Jacky Rosen of Nevada, where Big Solar wields a lot of sway.
“Its going to be a big factor in these talks,” said a senior Democratic congressional aide familiar with the bill, referring to the bureaucratic holdups facing renewables permits. The aide, who requested anonymity to discuss sensitive internal deliberations, said that lawmakers are racking their brains to find the “perfect language” to keep Trump in check. “Everything now has to be explicitly and clearly defined by Congress because there’s a track record of the federal government using any daylight where they can navigate the system to their advantage,” the aide told me.
Based on all my conversations, the House will likely vote to pass the SPEED Act, along with probably a slate of other permitting bills, maybe as soon as December. This will probably kickstart momentum in the Senate to produce something more bipartisan, which would in turn produce more pressure to address Trump’s permitting freeze head on.
There will be challenges with crafting language that makes all sides happy without creating unforeseen policy issues around executive powers in the future. “This issue of project certainty, as this subset of permitting talks has been called, is really tricky,” said Xan Fishman of the Bipartisan Policy Center. “How you actualize that into law is tough.” But if the Schoolhouse Rock of it all can be overcome, House Speaker Mike Johnson and Senate Majority Leader John Thune would be able to present a ready-made deal to the president.
Whether Trump would actually sign such a deal, however, is another ball of wax.
“The $64,000 question is, as this becomes even more real, will the White House start to intervene?” asked Josh Freed, senior vice president at Third Way’s climate and energy program.
There’s definitely outside momentum toward dealing with Trump’s permitting freeze under the valence of tech neutrality — whatever is good for the renewables goose would be good for the energy sector gander, so to speak. Mike Sommers, CEO of the American Petroleum Institute, said in a recent interview with Politico that addressing this freeze would help stop a future Democratic president from using the same trick on pipelines and drill sites. And Congressional Republicans appear to be negotiating in good faith with Democrats on the SPEED Act.
One D.C. energy lobbyist involved in the talks, however, confessed to me that the appearance of movement is “a lot of kabuki” unless Congress addresses the underlying issues around renewables permitting.
“It’s going to have to have teeth,” said the lobbyist, who requested anonymity because they did not have clearance to speak publicly. “The administration’s going to do whatever it wants.” And even with the language on executive power, the bill can only protect processes that fall under the federal government’s purview — that is, it won’t do anything with the litany of municipal and county restrictions that more frequently undermine renewable energy development.
When asked whether the White House was providing input on the SPEED Act, a spokesperson for Natural Resources Republicans told me that staff had “received technical assistance” from “relevant agencies.” The White House did not respond to requests for comment.
On California solar eating gas, China’s newest reactor, and GOP vs. CCS
Current conditions: Snow is blanketing parts of the Mountain West and Upper Midwest, making travel difficult in Montana, North Dakota, and Minnesota • Winds of up to 40 miles per hour could disrupt some air travel through Chicago and Detroit • A cold snap in China is set to drop temperatures by double digit degrees Fahrenheit in northern areas.
In just the last three months, Georgia Power has removed 6 gigawatts of projected demand from its 2030s forecasts — enough to serve every household in the Atlanta metropolitan area more than three times over, according to a filing Friday with the Georgia Public Service Commission. The cause: canceled or postponed data center developments. Projects totaling nearly 6 gigawatts of projected demand by the mid 2030s fell off the books. Of the 28 large power user projects the Southern Company-owned utility disclosed in its report to regulators, 18 have broken ground and 10 are pending constructions. That indicates that the developers are pushing to make sure they advance, and suggests the dip in the last quarter may not extend. In the report, Utility Dive noted, Georgia Power said the “majority of new generation” the company wanted approval for was “not backed by” contracts with large power users.
The adjustment comes as Georgia Power pushes regulators to approve a large new buildout of power plants that could raise monthly bills by $20, the Atlanta Journal-Constitution reported. Voters ousted long-time Republicans from the Public Service Commission, electing two Democrats who campaigned on slashing rising rates, Heatmap’s Emily Pontecorvo reported earlier this month. Data centers, however, are proliferating elsewhere. Just last night, Amazon unveiled plans to invest $15 billion in data center complexes in northern Indiana.

Over the last three years, California generated steadily more electricity from utility-scale solar farms while generation from natural gas-fired plants dropped. Gas still dominates the state’s power generation, but industrial solar generation more than doubled in the first eight months of 2025 compared to the same period in 2020, new analysis from the federal Energy Information Administration found. Between January and August of this year, natural gas supplied 18% less power than during the same months five years ago. Gas-fired generation spiked in 2021 to compensate for droughts reducing hydroelectric output, and has fallen since. But the largest year-over-year drop occurred this year.
You can count on one hand the number of new nuclear reactors built in the United States and Europe in recent memory. And while the Trump administration is taking major steps toward spurring new reactor projects in the U.S., the long-trumpeted nuclear renaissance has scarcely led to any new power plants with the promise of producing electrons anytime soon. That’s certainly not the case in China. Friday’s newsletter included China’s latest approval of two new reactors to begin construction. Today’s newsletter includes the update that China has officially patched yet another reactor onto the grid. China National Nuclear Corporation, one of the two major state-owned atomic power utilities in the country, announced that Unit 2 of its Zhangzhou nuclear plant is officially hooked up to the grid, World Nuclear News reported. It’s the second of six planned reactors, based on the Chinese-designed Hualong One model, at the same location in Fujian province.
It’s that capacity to build even the most complex of clean-energy infrastructure that has flattened out China’s emissions in recent years, as I wrote earlier this month. To go deeper on China’s grid, you should listen to the episode of Heatmap’s Shift Key podcast that includes UC San Diego export Michael Davidson.
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The Environmental Protection Agency has granted certain states the power to permit so-called Class VI wells to store captured carbon dioxide. Now many of those Republican-led states want to use that authority to reject carbon wells, E&E News reported. In Texas, the colorful energy regulator Wayne Christian called his agency’s decision to permit a major carbon removal and storage project “a danger.” In Florida, Governor Ron DeSantis called carbon storage a “scam” in a video posted on Facebook in March. In Louisiana, Governor Jeff Landry issued an executive order in October slapping a moratorium on new applications for Class VI permits until the state could “put into place a well-thought-out and methodical approach to application review and permitting.” And in Alabama, GOP state lawmaker Matthew Hammett prefiled a bill that would ban CO2 wells in the state’s southern county of Covington.
Arguably the biggest problem facing carbon capture technology is where to put that captured carbon and how to get it there. CO2 pipelines come with some risks, and mounting pushback. Until there’s somewhere for those pipelines to go, such as a well, it’s hard to justify the investment. No wells and no pipelines mean capturing carbon emissions before they enter the atmosphere will likely remain an unaffordable luxury.
The Trump administration has granted polluters waivers from Clean Air Act rules as part of its effort to revive heavy industry. But until recently, regulators appointed by President Donald Trump said such a pass wasn’t needed for the coking industry, which distills coal into fuel for a blast furnace. On Friday, Trump issued a proclamation granting a dozen coke manufacturing plants a two-year extension on fully meeting hazardous air pollutant rules, E&E News reported.
The move isn’t entirely unexpected. Trump has tried to revive coal-fired power generation, but keeps coming up against broken equipment that shuts down stations anyway, as Heatmap’s Matthew Zeitlin reported. But as Matthew wrote in July, global coal demand is rising, and the U.S. wants in on it.
As recently as 2022, when Cameco bought its 49% share of Westinghouse, the Canadian uranium producer doubted the company had a future in reactors. Cameco was primarily interested in Westinghouse’s fuel fabrication and maintenance service businesses. “We just assumed there wouldn’t be anything new,” Grant Isaac, Cameco’s president and chief operating officer, told The Wall Street Journal. Now, the Trump administration putting up $80 billion to fund at least 10 new Westinghouse AP1000, each with the capacity to power 1 million American homes.
Automakers aren’t sure what to do with their EVs in the age of Trump.
The Los Angeles Auto Show over the years has been the launchpad for lots of new electric vehicles and a place for carmakers to declare their EV ambitions. It’s a fitting stage given California’s status not only as the home of American car culture, but also as the United States’ biggest EV market by far.
At the 2025 show, which had its media day on Thursday, electrification was more off to the side than front-and-center, however. The new breed of affordable models that could give many more drivers access to the electric car market — such as the Nissan Leaf and Chevy Bolt revivals and the upcoming Toyota C-HR electric — could be found on the show floor, waiting to be discovered by the car fans who would descend on the L.A. Convention Center in the days to come.
But fanfare over the electric future was decidedly tamped down. The atmosphere reflected the uneasy state of EVs in America in this first year of the new Trump administration. During Kia’s press conference to start the day, for example, the EV9 three-row electric crossover lingered at the edge of the stage while brand bigwigs revealed a redesign of its petroleum-powered cousin, the best-selling Telluride, whose climate credentials go only as far as a 30-miles-per-gallon hybrid version.
Hyundai has been perhaps the most successful brand outside of Tesla in selling America on EVs, but its L.A. presentation pushed battery power into niche corners of the car world, the racetrack and the trail. One of its two attractions was the North American reveal of the limited-edition Ioniq 6N, the powered-up sports car version of the Ioniq 6 electric sedan, which the brand revealed at this very show three years ago.
This 641-horsepower battery-powered beast was an inevitability, given that Hyundai’s high-performance “N” division has built limited-edition racing versions of many of the carmakers’ stock vehicles, and its muscular version of the Ioniq 5 hatchback has been one of the best-regarded performance-focused EVs yet to hit the car market. Like its predecessor, Ioniq 6N is a test case in how to make electric power appeal to car enthusiasts who crave stick shifts and snarling V8s, so Hyundai built in simulated gear shifts and sounds to simulate the sensations of pushing a combustion car to its limits.
More compelling — and curious — was the Crater, the kind of otherworldly angular tank that Tesla’s Cybertruck wishes it were. A concept car rather than a vehicle ready to go into real production, the Crater is meant to signify the vision of Hyundai’s XRT sub-brand that makes off-roading versions of the brand’s vehicles, combustion ones included.
Although Hyundai barely said the “e” word during its presentation, Crater is meant to at least suggest an all-electric version of a supremely rugged vehicle that would compete with the likes of the Jeep Wrangler and Ford Bronco. The concept has no tailpipe or engine, and the pixelated lights are taken from those used on the Ioniq series. Yet even this is uncertain: Having been burned by the back-and-forth of regime change in America, with Biden-era EV incentives disappearing just as the Korean brands were adjusting their production lines to meet the rules, the carmakers are wondering how hard to push battery power here.
Even the all-electric car brands didn’t arrive with sound and fury to show off all-new cars that would invigorate the EV market. Instead, they are doing the slow and steady work that legacy car companies have been doing for years, hoping to build long-term stability by filling out their vehicle lineups with more subtly different versions at more price points.
The Rivian R2 sat at the edge of the brand’s small display, giving many people their first in-person look at what could be the make-or-break vehicle for the EV startup. Its quiet presence was a subtle reminder that the smaller SUV is coming next year at a promised price of around $45,000, which would provide a (more) affordable option for drivers who’ve lusted after the brand’s $70,000-plus initial slate of electric SUVs and pickup trucks.
Likewise, Lucid took the mic after Hyundai to introduce a somewhat more attainable version of its electric SUV. The Gravity Touring edition brings the vehicle’s starting price from six figures down to $80,000, thanks in part to a smaller battery pack that still delivers more than 300 miles of range thanks to the carmaker’s hyper-focus on aerodynamics and efficiency. The price is still high, but this is a compelling vehicle: Gravity is a spacious three-row vehicle that goes 0 to 60 miles per hour in four seconds and recharges its battery at blazing speed thanks to 1,000-volt architecture that can add a claimed 200 miles in 15 minutes.
Car show stories come with a big caveat: These events don’t have the status they did in the heyday of old media, when new vehicles greeted the world for the first time in front of the assembled reporters. Tesla has always hosted its own vehicle events rather than share the stage, and these days, lots of brands have followed suit. Rivan revealed the R2 and R3 on its own turn last year, which is why the R2 could loom, unheralded, in a quiet corner of the show floor in Los Angeles.
Yet what the car industry chooses to show and say in front of the car media is still a telling indicator. What the companies said and didn’t say on Thursday suggests an industry that’s clearly struggling to navigate the electrification transition in America. Kia has been at the forefront of building great EVs for the States; its trumpeting of a hybrid Telluride is welcome, but 10 years out of date. The absence of EV hype in press events reveals an industry putting the brakes on the big talking points and preparing to lean back toward fossil fuels to maintain their profitability through this era of American EV limbo.