Utilities await clarity on DOE loans as decisive court battle looms

The Trump administration will likely scrutinize funding for renewables and climate change mitigation, potentially affecting outlays for critical grid investments, experts say.

In the waning days of the Biden administration, the U.S. Department of Energy’s Loan Programs Office announced nearly $23 billion in conditional loan commitments for eight utility generation, transmission and grid modernization initiatives spanning 12 states.

Recipients of low-interest LPO loans “incur lower financing costs for their qualifying infrastructure projects than if they had used commercial capital markets [and] will pass along the savings to customers” while fulfilling LPO’s mandate to “make the clean energy transformation affordable and achievable for everyone,” DOE said on Jan. 16.

But these conditional commitments find themselves in limbo amid the Trump administration’s Jan. 20 pause of “green new deal” spending and a much broader Jan. 27 freeze — now temporarily on hold as lawsuits pile up in federal court — on virtually all discretionary federal spending. So do dozens of other conditional and finalized LPO commitments, along with tens of billions more in funding from other federal programs authorized by Biden-era energy and infrastructure legislation. On Jan. 28, the Environmental Protection Agency notified awardees of its $7 billion, IRA-authorized Solar for All program that it was pausing grants until further notice, and several awardees were unable to access its online portal, E&E News reported Thursday.

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For more utility related reading, check out the potential impact of the Supreme Court’s Chevron decision, TerraPower’s new reactor construction, and the demand for AI potentially driving more generation investment.

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