The U.S. Department of Energy on Wednesday said it intends to cancel more than $13 billion in funds that had been pledged under the Biden administration to support wind, solar, battery development, and electric vehicles.
The announcement, made by Energy Secretary Chris Wright at a press conference in New York, underscores the Trump administration’s sharp pivot away from renewable subsidies in favor of maximizing oil and gas output, which has already reached record levels since Trump’s return to office in January.
“By returning these funds to the American taxpayer, the Trump administration is affirming its commitment to advancing more affordable, reliable, and secure American energy and being more responsible stewards of taxpayer dollars,” the department said in a statement.
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The decision comes just a day after President Donald Trump told world leaders at the United Nations General Assembly that climate change was “the greatest con job” in history, a declaration that doubled down on his long-standing skepticism of international environmental initiatives and multilateral agreements.
California Governor Gavin Newsom swiftly condemned the move, warning that the U.S. was ceding ground to global competitors. “(Chinese) President Xi, I don’t know what else he’s got to applaud. … I think he’s going to give (President Donald) Trump a bear hug when he arrives,” Newsom said during an appearance at a New York Times climate event.
He stressed that California, which has some of the most ambitious clean energy and emissions targets in the world, could see its progress undermined by Washington’s retreat.
The Department of Energy has not disclosed which specific programs will lose funding, raising uncertainty among states and private companies that had already begun planning projects under Biden-era commitments.
The cancellation lands at a time when the renewable sector has been outpacing other parts of the U.S. economy. Jobs in wind, solar, and other clean technologies grew three times faster than the overall U.S. workforce in 2024, according to a study by advocacy group E2. Analysts warn that Trump’s reversal could stall or even reverse that growth, with ripple effects across supply chains and investment flows.
Wright defended the administration’s stance, arguing that climate change has been “wildly exaggerated” into the world’s greatest threat, spurring “massive amounts of spending with very little positive impact.” He added that he has no plans to attend the UN climate talks in Brazil later this year, though he said he remains open to “conversations with people who see things differently.”
However, the political optics extend beyond domestic debate. With Trump expected to meet Chinese President Xi Jinping in the coming weeks, analysts say the funding reversal hands Beijing an opportunity to cement its global dominance in clean energy technologies, from solar panels to batteries—sectors where Chinese firms already control a commanding share of production.
China and the European Union are moving in the opposite direction of the U.S. — scaling up clean-energy capacity and investment at a pace. The International Energy Agency and Reuters reporting show China investing very large sums in renewables (hundreds of billions annually) and accelerating wind and solar rollouts, while the EU is set to add record renewable capacity this year, driven by policy support and grid upgrades.
Those programs are underpinning manufacturing and supply chains that global companies now rely on. The U.S. rollback, therefore, risks leaving American firms and workers behind in factories and markets where scale and manufacturing leadership matter.
For many industry leaders, the shift raises questions not just about jobs and investment, but about the future of U.S. competitiveness in a global energy transition that is accelerating even as Washington retreats.
Industry leaders say cancelling funds will depress private investment plans that had banked on federal support. At a basic level, capital allocators respond to policy clarity and scale — long-term, predictable incentives that reduce technology risk.
China’s enormous state-guided build-out and the EU’s coordinated market signals are already pulling supply chains, factory capacity, and R&D spending toward those regions. That creates a self-reinforcing advantage: as China and Europe scale up, their firms lower costs and gain market share, making it harder for U.S. suppliers to compete later.
Global clean-technology markets are entering a scale-up phase where first-mover industrial advantage matters. Capacity additions in China and the EU are already reshaping price curves for panels, wind turbines, and battery cells. The U.S. decision to rescind pledged funds, therefore, comes at a moment when predictable public backing is often the tipping point for major factory builds.