Judge Says EPA Must Show Evidence of Wrongdoing in $20 Billion Climate Program

The EPA notified grant recipients that they will no longer receive funding under the program.

EPA Administrator Lee Zeldin speaks to the press in Washington on Feb. 18, 2025. Kayla Bartkowski/Getty Images

A federal judge asked the Environmental Protection Agency (EPA) on March 12 to submit evidence justifying its decision to terminate a $20 billion climate funding program.

Judge Tanya Chutkan of the U.S. District Court for the District of Columbia said during a court hearing that she would order the administration to file a sworn statement by March 17 detailing the evidence it used as the basis for ending the grant.

“You can’t even tell me what the evidence of malfeasance is,” Chutkan told a lawyer for the Trump administration during the hearing.

The EPA confirmed earlier this month that it had canceled what it described as a $20 billion “gold bar” scheme introduced by the previous administration.

The program, formally known as the Greenhouse Gas Reduction Fund, is commonly called the “green bank.” It was approved under the 2022 Inflation Reduction Act, with the EPA awarding $20 billion in grants to eight entities to launch projects aimed at curbing pollution.

EPA Administrator Lee Zeldin announced in early February that the agency was working to claw back the funding, citing concerns about lack of oversight and transparency.

In a March 11 statement, Zeldin said the EPA had conducted a “comprehensive review” and identified “material deficiencies which pose an unacceptable risk to the lawful execution of these grants.”

As a result, the agency notified recipients of the grant that they would no longer receive funding, he said.

“The days of ’throwing gold bars off the Titanic' are over. The well documented incidents of misconduct, conflicts of interest, and potential fraud raise significant concerns and pose unacceptable risk,” Zeldin said. “I have taken action to terminate these grants riddled with self-dealing and wasteful spending. EPA will be an exceptional steward of taxpayer dollars dedicated to our core mission of protecting human health and the environment, not a frivolous spender in the name of ‘climate equity.’”

The EPA said it would work to “re-obligate lawfully appropriated funds” in the green bank program with “enhanced controls to ensure adequate governance, transparency, and accountability, consistent with statutory requirements.”

Climate Group Sues EPA, Citibank

Climate advocates and Democrats argued the move illegally seizes money allocated for clean energy and transportation for disadvantaged communities.

Chutkan’s demand for evidence came as part of a lawsuit filed over the weekend by the Climate United Fund advocacy group against the EPA and Citigroup’s Citibank for withholding the obligated funds.

The filing alleges the EPA acted illegally to prevent Citibank from dispersing funds, harming Climate United, its borrowers, and the communities they serve, and impacting its reputation as a lender.

According to the lawsuit, Climate United has no other committed sources of funding to replace the grant funds and will soon run out of cash to cover operating expenses, including employee salaries, rent, and payments to critical service providers and contractors, if it does not receive the funding.

Climate United asked the court to order Citibank to comply with its contractual obligations and to declare that the EPA’s suspension or termination of the grant violates the Administrative Procedure Act.

“This isn’t about politics; it’s about economics,” Climate United CEO Beth Bafford said in a statement announcing the lawsuit. “This program was designed to save money for hard-working Americans who are struggling to pay for groceries and keep the lights on. We’re going to court for the communities we serve—not because we want to, but because we have to.”

The EPA declined to comment when contacted by The Epoch Times, citing the pending litigation.

Reuters contributed to this report.