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Green technology

States Sue Federal Energy Officials Over New Policy Capping Funding for Sustainable Energy Projects

Strategic Insights

— 2 min read

Oregon Attorney General Dan Rayfield, joined by the attorneys general and governors of 18 other states, has filed a lawsuit against the U.S. Department of Energy and its leader, Chris Wright, over a new policy that caps funding for staff who work on sustainable energy and energy efficiency projects. The policy, which mandates that "indirect" and "fringe" costs for State Energy Program projects cannot exceed 10% of overall project costs, is deemed arbitrary and against the law by the states. The policy is expected to lead to needless job losses and project terminations, as states rely on federal grants to fund essential energy projects.

Key Takeaways:

  • The states are suing the U.S. Department of Energy over a new policy that caps funding for staff who work on sustainable energy and energy efficiency projects at 10% of overall project costs.
  • The policy is deemed arbitrary and against the law by the states, which rely on federal grants to fund essential energy projects.
  • Oregon received about $786,000 in federal grants through the State Energy Program last year, with nearly half ($333,000) going to indirect and fringe costs such as staff salaries and benefits.
  • The cap on funding for indirect and fringe costs will lead to staffing cuts across several teams in states such as Colorado, Minnesota, and Kentucky, resulting in budget constraints that will impact the states' ability to meet their statutory energy efficiency and renewable energy objectives.
  • The states that have joined the lawsuit include Oregon, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Michigan, Minnesota, Nevada, New Mexico, New York, North Carolina, Washington, Wisconsin, and the District of Columbia, as well as Kentucky and Pennsylvania.

Statistics:

  • Oregon received about $786,000 in federal grants through the State Energy Program last year.
  • Nearly half (about $333,000) of the grant went to indirect and fringe costs such as staff salaries and benefits.
  • Colorado's energy agency stands to lose about $367,000 in expected funding if the 10% cap on indirect and fringe funding isn't lifted.
  • Minnesota stands to lose about $290,000 in the next year if the cap is not lifted.
  • Kentucky stands to lose $230,000 per year if the cap is not lifted.

Sources:

  • Complaint filed by Oregon Attorney General Dan Rayfield and the attorneys general of other states against the U.S. Department of Energy and its leader, Chris Wright.
  • Federal Register: State Energy Program and Energy Efficiency and Renewable Energy.
  • Afdc.energy.gov/laws/317: 42 U.S.C. § 6244 - State Energy Program.
  • Datawrapper.dwcdn.net/Vg6lL/4: Multi-state lawsuits Oregon's joined since Trump took office.
  • Oregoncapitalchronicle.com/subscribe: GET THE MORNING HEADLINES. SUBSCRIBE.

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