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By EPN Staff

At least three federal judges have ruled billions in federal funds awarded to energy companies and nonprofits through grant programs authorized by the Inflation Reduction Act cannot be legally blocked by the Trump administration.

The rulings affect nearly $3.2 billion in grants and loans to rural electric cooperatives and other companies that had been put on hold pending review since Jan. 27, 2025, when the Office of Budget and Management issued a memorandum.

The recent decisions build on a prior restraining order issued by U.S. District Chief Judge John J. McConnell, Jr., who concluded the pause "fundamentally undermines the distinct constitutional roles of each branch of our government." U.S. District Judge Loren Ali Khan issued a restraining order in late February.

Why it matters

The awards were made in September 2024 by the U.S. Department of Agriculture's Rural Utilities Service as part of the Empowering Rural America initiative in the Inflation Reduction Act, passed under the Biden Administration. Each was designed to facilitate the companies’ transition to renewable energy sources. Examples in the Mountain West include:

  • Westminster-based Tri-State, which provides wholesale power to 41 cooperatives in four states, received $2.5 billion in grants and low-interest loans. The award is to help close coal-fired plants in Arizona, Colorado, and New Mexico by enabling Tri-State to purchase solar and wind power and battery storage in Colorado, Nebraska, New Mexico and Wyoming.
  • Colorado’s largest co-op, CORE Electric Cooperative, serving more than 375,000 residents in parts of 11 counties from east of Denver west to Colorado Springs was awarded $225 million for purchase agreements involving renewable resources.
  • Brighton-based United Power, the No. 2 co-op in Colorado, received $262 million for purchase agreements involving renewable resources.
  • Granby-based Mountain Parks Electric received $9.7 million and an agreement to receive $100 million over the next two decades to support power purchase agreements involving renewable resources.
  • Steamboat Springs-based Yampa Valley Electric was awarded $50 million to purchase solar power and battery storage.
Additional context

In its Jan. 27, 2025 OMB memo, the administration stated it wanted all federal agencies to pause all activities related to the obligation or disbursement of all federal financial assistance including, but not limited to, "foreign aid, nongovernmental organizations, DEI, woke gender ideology, and the green new deal" to ensure they are consistent with the president's memoranda since taking office.

The memo stated all awards must be consistent with executive memos such as:

It also assigned each financial assistance program a senior political appointee to ensure the program complies with memoranda, is performing at the expected level, and has addressed any identified issues.

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