On October 1, 2025, the Trump administration delivered a seismic jolt to the American clean energy sector, abruptly cancelling billions of dollars in federal funding for hundreds of green projects across the country. The move, announced on the first day of a partial government shutdown, sent shockwaves through the Pacific Northwest and beyond, as local governments, industry leaders, and environmental advocates scrambled to assess the fallout.
At the heart of the controversy lies the Pacific Northwest Hydrogen Hub, a tri-state initiative launched just last year with the promise of funneling up to $1 billion in federal taxpayer money to kickstart zero-emissions hydrogen fuel production. The hub’s backers—spanning private industry, truck manufacturers, transit agencies, and seaport authorities—had pledged to match those dollars with significant investments of their own over the next decade. But with a single stroke, the Trump administration has put the entire enterprise on ice.
According to the Washington State Standard, the Energy Department’s decision was part of a broader rollback, targeting 223 clean energy projects in 16 states and amounting to nearly $8 billion in rescinded funding. The vast majority of these projects were located in states that voted for Democratic nominee Kamala Harris in the 2024 presidential election. The administration’s rationale? As Energy Secretary Chris Wright stated in a news release, the projects “did not adequately advance the nation’s energy needs, were not economically viable, and would not provide a positive return on investment of taxpayer dollars.”
Russell Vought, Director of the White House Office of Management and Budget, celebrated the move on social media, describing it as the cancellation of “Green New Scam funding to fuel the Left’s climate agenda.” Yet the political overtones of the decision were impossible to ignore. Democratic officials from Oregon and Washington immediately decried what they called an “illegal” clawback of Congressionally-directed spending, vowing to challenge the administration’s actions in court.
“This administration has had plans in the works for months to cancel critical energy projects, and now, they are illegally taking action to kill jobs and raise people’s energy bills,” Washington Senator Patty Murray declared in a statement. “This is a blatant attempt to punish the political opposition, but this won’t just hurt Democrats—it’ll hurt regular people just trying to get by, in red districts and blue districts alike.”
Ironically, as CNBC pointed out, much of the planned hydrogen infrastructure was set to be built in counties that had voted for Trump, such as Benton and Lewis counties in Washington, and Baker and Morrow counties in Oregon. Nevertheless, the cancellations hit hardest in Democratic-led states, a fact not lost on local leaders. Washington Governor Bob Ferguson said his office was working with the state Attorney General to “fight this illegal action.”
The list of casualties is long and varied. In addition to the Pacific Northwest Hydrogen Hub, the administration also cancelled funding for California’s ARCHES hydrogen hub—a $1.2 billion blow to the state’s clean energy ambitions. Other projects axed included a $250 million power transmission line upgrade on the Warm Springs Reservation in central Oregon, nearly $10 million in solar and vehicle technology grants to Washington State University, a $68 million award to Bellevue-based truck maker PACCAR for cleaner semi truck development, and a $10 million grant to CleanFiber to build a recycled cardboard insulation factory in Chehalis, Washington.
The Department of Energy, for its part, has given affected project sponsors 30 days to appeal the cancellations. Some have already begun the appeal process, but the uncertainty is palpable. “We are, of course, very disappointed in that,” said Chris Green, president of the Pacific Hydrogen Association, in an interview with CNBC. “Can we still do this project now that we’ve lost 20% of our planned revenue? It remains to be seen if some of these projects can persevere.”
The stakes are high. The Pacific Northwest Hydrogen Hub alone was expected to create thousands of jobs, with private companies providing about 80% of the committed funds. The largest component of the hub was to be a $1.5 billion green fertilizer factory near Richland, Washington, developed by Switzerland-based Atlas Agro. Another major project, led by Calgary-based AltaGas, aimed to redevelop the shuttered Intalco aluminum smelter near Ferndale, Washington, into a climate-friendly hydrogen facility. Both ventures are now in limbo, with corporate boards postponing final investment decisions due to the sudden withdrawal of federal support.
Other states are feeling the pain as well. Colorado lost more than 30 grants totaling over $500 million, targeting everything from methane reduction to grid resilience and utility programs for low-income communities. In New Mexico, over $135 million in Energy Department funding vanished, including $42.7 million earmarked for a storage hub in the San Juan basin. “This clearly politically motivated targeting of grants by the Administration will balloon energy costs, threaten grid reliability, increase pollution, and create instability in our business community,” the Colorado Energy Office said in a statement.
Critics argue that the cuts are not only politically motivated but also self-defeating. “There would have been significant emissions reductions from these projects,” said Ian Wells, a senior advocate at the National Resources Defense Council, to CNBC. “Not only greenhouse emissions, but things that would lead to cleaner air and water.” Senate Minority Leader Chuck Schumer echoed those concerns, stating, “This goes beyond targeting blue states. It’s taking a wrecking ball to working families’ lives: putting construction workers out of a job and raising families’ electric bills for political gain.”
The administration, however, insists it is acting in the nation’s best interest. Energy Secretary Wright defended the cancellations as the result of “a thorough, individualized financial review,” asserting that many of the awards were “rushed through in the final months of the Biden administration with inadequate documentation by any reasonable business standard.” The department noted that 26% of the terminated awards were issued between Election Day and Inauguration Day, representing more than $3.1 billion in commitments.
Yet, the lack of transparency has only fueled further suspicion. According to CNBC, the Energy Department has not publicly released a full list of the cancelled projects, and Democratic lawmakers have questioned both the legality and the process behind the terminations. “These programs were enshrined into law by bipartisan majorities and they represent the will of Congress. You have no legal authority to sabotage them,” wrote Senator Martin Heinrich of New Mexico and other Democrats in a letter to Secretary Wright.
Even before this week’s announcement, the Pacific Northwest Hydrogen Hub had been facing headwinds. Several major energy developers—including Fortescue, Portland General Electric, Mitsubishi Power, First Mode, and Puget Sound Energy—had already withdrawn from the project due to slower-than-expected demand for hydrogen fuel and the high cost of production. The challenge of finding affordable renewable electricity to power hydrogen production loomed large, and now, with federal support evaporating, the future of the region’s clean energy ambitions is more uncertain than ever.
Still, some project leaders are striving to find hope amid the turmoil. In a message to partners, Pacific Northwest Hydrogen Hub President Chris Green wrote, “Whether or not this grant funding remains, I’m encouraged that the trail is now blazed for more development and projects to be delivered in this market and that there will be a bright future for H2 as a highly successful and lucrative energy product in the future in our region.”
The coming weeks will be crucial, as affected states and companies weigh their legal options and the clean energy sector grapples with the loss of federal support. For now, the abrupt funding cuts have left a trail of uncertainty, dashed hopes, and a fierce debate over the future of America’s energy landscape.
