Trump is freezing money for clean energy. Red states have the most to lose.

Boston Globe

10-02-2025

So far, Republican-voting communities have benefited the most from that law. In the nearly three years since it was passed, private companies chasing the law's tax breaks have announced plans to spend $165.8 billion to build factories that make solar panels, wind turbines, electric vehicles, and more, according to new data from Atlas Public Policy, a research firm. Roughly 80 percent of those investments are in Republican congressional districts, where they are creating a once-in-a-generation manufacturing boom.
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The Inflation Reduction Act, along with a separate 2021 bipartisan infrastructure law, also provided tens of billions of dollars in grants that have since been awarded by the federal government to private companies, states, and nonprofit organizations. These are legally binding obligations that have allowed companies to make investments, sign leases, and hire workers, with the expectation that they would be reimbursed by the government.
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Two federal judges have ordered the Trump administration to end its freeze and release money from programs authorized by Congress, but there is evidence that several agencies are still blocking funding.
The uncertainty is delaying projects and halting investments in areas that voted for Trump. In Montana, a biofuels plant did not receive on time a $782 million payment it was owed, the first part of a $1.67 billion federal loan guarantee. In Georgia, $1 billion in projects to modernize the power grid are on hold. In Nevada, a half-dozen large solar projects on federal lands are caught in a permitting freeze.
The upheaval has put Republicans in the tricky position of defending a White House that deems money for clean energy a 'waste of taxpayer dollars' while working behind the scenes to protect their towns from the loss of new manufacturing jobs.
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'This is where we get a test of whether the Republican Party is a real political party serving its constituents, or a personality cult,' said Jason Walsh, executive director of the BlueGreen Alliance, a coalition of labor unions and environmental advocacy groups.
'I expect thousands of people to be laid off, I expect workers to be furloughed, and I expect construction projects to halt,' Walsh said.
The political turmoil could put planned manufacturing projects at risk, analysts said. Of the nearly $30 billion in clean technology factories that were scheduled to come online in 2025 — including manufacturing facilities for solar, wind, batteries, and electric vehicles — more than half are now predicted to face delays or cancellations, according to a new report by BloombergNEF, a research firm.
That's not solely because of Trump. Some factories were already struggling with weaker-than-expected demand for electric vehicles, rising costs, or foreign competition.
But many manufacturers now face 'significant political uncertainty' on top of that, as companies wonder whether the Trump administration will repeal or modify federal loans and tax incentives, said Antoine Vagneur-Jones, head of trade and supply chains at BloombergNEF.
'Bringing a lot of this manufacturing back to the United States would be tricky even in the best case,' Vagneur-Jones said. 'You need massive amounts of political determination and policy clarity to pull this off. And when that's lacking, things start to get very messy.'
At the Environmental Protection Agency, programs funded through the Inflation Reduction Act remain paused despite the recent court orders, according to internal emails. That included grants to states for reducing air pollution at ports and schools, monitoring pollution levels in neighborhoods next to industrial facilities, and installing solar panels in low-income communities. And at the Energy Department, employees said money for various grants and awards was still frozen.
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The Interior Department has stopped permitting for solar and wind projects on public lands and waters for at least 60 days, saying it was conducting a review. At the Army Corps of Engineers, permitting for 168 renewable energy projects was paused last week. On Thursday that pause was lifted, but not for wind power projects, said Doug Garman, an agency spokesperson.
The White House declined to comment. Neither the EPA nor the Department of Energy responded to requests to explain why they halted legally binding contracts despite the judge's order.
The uncertainty over whether Republicans might repeal major clean-energy incentives to pay for Trump's tax cuts and immigration policies is also making investors nervous.
In the Northeast, offshore wind companies are pulling back plans for multibillion-dollar investments after Trump issued an executive order halting approvals for turbines in the ocean. On Monday, New Jersey abandoned plans to award new offshore wind contracts after Shell withdrew from the most promising project.
While many planned offshore wind farms would be in Democratic-led states such as New York and Massachusetts, the projects themselves support a $25 billion supply chain that includes steel mills, shipbuilders, and other manufacturers across 40 states, including Ohio, Louisiana, and Texas, according to a report by the Oceanic Network, a nonprofit group that represents the offshore wind industry and its suppliers.
'When a big, multibillion dollar project doesn't move forward, there are so many downstream investments that are affected,' said Stephanie Francoeur, a spokesperson for Oceantic.
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The freeze has put Democrats in the unusual position of insisting that money continue to flow to their political rivals.
'It is illegal and we're not going to stand for it,' said Representative Kathy Castor, a Florida Democrat. 'We're going to fight back to make sure that these dollars get to where they are supposed to go.'
Republicans whose districts have projects that are now on the chopping block have refrained from publicly criticizing Trump's actions.
'There might be some things in there that are worth saving,' said Representative Michael Rulli, an Ohio Republican whose district has $415 million in private investment spurred by federal incentives, including a $230 million auto parts manufacturing facility in Dover that is expected to create 650 new jobs. 'That's going to take a little time to figure out.'
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