California Attorney General Rob Bonta announced Wednesday a lawsuit against the Trump administration, challenging the cancellation of approximately $2.7 billion in federal funding for clean energy projects initially awarded under the Biden administration. This marks California’s 58th lawsuit against the current president since he took office last year, according to state officials.
The lawsuit, filed in the U.S. District Court for the Northern District of California, names the U.S. Department of Energy and the Office of Management and Budget as defendants. It alleges the administration illegally terminated funding allocated through the Inflation Reduction Act and the Bipartisan Infrastructure Law, with a disproportionate impact on states that did not support Trump in the 2024 presidential election.
A significant portion of the contested funding – $1.2 billion – was earmarked for California’s Alliance for Renewable Clean Hydrogen Energy Systems (ARCHES), a major initiative to develop clean hydrogen technology. An additional $4 million intended for energy-efficient building upgrades within the state was also rescinded. Governor Gavin Newsom stated the cuts would eliminate an estimated $3 billion in annual health cost savings related to improved air quality.
Attorney General Bonta characterized the funding cuts as “partisan retribution,” asserting they would result in the loss of over 200,000 union jobs, increased energy costs, and worsened pollution in California. “These aren’t optional programs — these are investments approved by bipartisan majorities in Congress, and the President doesn’t get to cancel them simply because he disagrees with them,” Bonta told reporters.
The lawsuit contends the administration’s actions violate the constitutional separation of powers, as Congress had already approved and appropriated the funds. It also cites violations of the Administrative Procedure Act, which mandates fair and transparent procedures for government agency decisions. The state is seeking a court order declaring the administration’s actions unlawful and preventing further interference with the programs.
The Office of Management and Budget, under Director Russell Vought, announced in late September the termination of “nearly $8 billion in Green New Scam funding” across 16 states, according to a post on X. The Department of Energy followed with a series of termination letters to grant recipients, citing concerns that the projects did not “adequately advance the nation’s energy needs” or offer a sufficient return on investment.
The cuts impacted over 300 financial awards for 223 projects nationwide. The ARCHES hub, intended to foster the adoption of clean hydrogen in sectors like public transit and port operations, was forced to cease operations and lay off its entire staff. According to a tracker maintained by the nonprofit Climate Power, more than 165,000 jobs in the clean energy sector have been lost or delayed since Trump’s election.
Alongside California, the lawsuit is joined by the attorneys general of Washington and Colorado, as well as Connecticut, Illinois, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island, Vermont, and Wisconsin.
The Energy Department and Office of Management and Budget have not yet issued a public response to the lawsuit. The administration has previously signaled its opposition to initiatives promoting renewable energy, with the president issuing executive orders on his first day in office declaring a “national energy emergency” and calling for the conclude of the Green New Deal.
Data from the U.S. Energy Information Administration indicates that residential electric bills nationwide rose approximately 12% in 2025, increasing from 15.9 cents per kilowatt hour in January to 17.8 cents by the end of November.
