Alex Padilla U.S. Senator for California

Senators: “Dissolving contracts, cancelling grants and loans, and reneging on loan guarantees without any intention to execute the laws is not only illegal, but is harmful to the public and energy consumers”

California’s ARCHES Hydrogen Hub among projects on list of potential cuts

WASHINGTON, D.C. — U.S. Senator Alex Padilla (D-Calif.) and 26 other Democratic Senators demanded that U.S. Department of Energy Secretary Christopher Wright uphold his commitment to honor existing legal agreements and deliver funds passed into law by Congress. The letter comes on the heels of recent reports that the Department of Energy is creating a “hit list” of awards, contracts, and projects — many of which have already began construction — it is considering canceling. These cuts would break existing agreements while leading to significant job losses and a reduction in growth of new energy resources. 

The Trump Administration’s proposed cuts include hydrogen hub projects funded by the Bipartisan Infrastructure Law, including California’s Alliance for Renewable Clean Hydrogen Energy Systems (ARCHES) hydrogen hub for which Senator Padilla secured up to $1.2 billion. Reportedly, the hubs under threat are all in Democratic-leaning states like California, while hydrogen hubs in Republican-leaning states would maintain funding.

This hit list is a stark reversal from Secretary Wright’s confirmation hearing, where he said legal agreements should be honored and that he would follow the law. The Senators expressed serious concerns about the reports and reasserted Congress’ authority over the programs they fund.

“Indiscriminately canceling program funding and executed contracts, and refusing to execute on the funding directives Congress enacted, neither honors existing agreements nor is consistent with the spending laws that have appropriated funding for specific purposes,” wrote the Senators.

“Dissolving contracts, cancelling grants and loans, and reneging on loan guarantees without any intention to execute the laws is not only illegal, but is harmful to the public and energy consumers. Your indiscriminate cancellations of spending will increase energy prices, make our grid less secure, and stop energy innovation,” continued the Senators. “If the Department has a policy disagreement and does not want to spend money on programs Congress has funded, the lawful response is to ask Congress to rescind that funding. The decision ultimately rests with Congress, not with the President, the Department of Energy, or the Department of Government Efficiency.”

The Senators concluded by demanding a detailed list and briefing that identifies which grants, loans, or loan guarantees Secretary Wright believes should be rescinded and why.

The letter was led by Senator Patty Murray (D-Wash.), Vice Chair of the U.S. Senate Committee on Appropriations, and Senator Martin Heinrich (D-N.M.), Ranking Member of the Senate Committee on Energy and Natural Resources. In addition to Senator Padilla, the letter was also signed by Senate Minority Leader Chuck Schumer (D-N.Y.) and Senators Richard Blumenthal (D-Conn.), Maria Cantwell (D-Wash.), Catherine Cortez Masto (D-Nev.), Dick Durbin (D-Ill.), Ruben Gallego (D-Ariz.), Kirsten Gillibrand (D-N.Y.), Mazie Hirono (D-Hawaii), Mark Kelly (D-Ariz.), Ben Ray Luján (D-N.M.), Jeff Merkley (D-Ore.), Gary Peters (D-Mich.), Jack Reed (D-R.I.), Jacky Rosen (D-Nev.), Brian Schatz (D-Hawaii), Adam Schiff (D-Calif.), Jeanne Shaheen (D-N.H.), Elissa Slotkin (D-Mich.), Tina Smith (D-Minn.), Chris Van Hollen (D-Md.), Mark Warner (D-Va.), Peter Welch (D-Vt.), Sheldon Whitehouse (D-R.I.), and Ron Wyden (D-Ore.).

Yesterday, Senator Padilla questioned President Trump’s nominee for Deputy Secretary of Energy on the hit list, highlighting the importance of the Regional Clean Hydrogen Hubs program to “jumpstart” the national hydrogen economy and urging him to protect vital funding for ARCHES.

Full text of the letter is available here and below:

Dear Mr. Secretary:

We are deeply troubled by recent news reports that the Department of Energy (Department) is creating a “hit list of clean energy projects” to “wipe out” for being inconsistent with the President’s priorities. This list reportedly includes hydrogen hubs and carbon capture, critical mineral, and battery storage projects that have already received grant and loan funding from the Inflation Reduction Act, the Bipartisan Infrastructure Law, and annual appropriations bills.

You assured us during your confirmation hearing that you believe that legal agreements should be honored (including managing the financial commitments you have inherited) and that you will follow the law. Indiscriminately canceling program funding and executed contracts, and refusing to execute on the funding directives Congress enacted, neither honors existing agreements nor is consistent with the spending laws that have appropriated funding for specific purposes.

Our Constitution gives Congress the power of the purse and exclusive power to appropriate funds. Once a law is properly enacted, the Constitution requires the President to “take Care that the Laws be faithfully executed.” The President cannot substitute his policy preferences for requirements in law, and that includes refusing to spend funds Congress requires the President to spend.

In this instance, where Congress has authorized and appropriated funds for programs that support clean energy projects, the Department must faithfully execute the law and expend the funds for the purposes provided. For example, programs authorized that have received federal appropriations under the Bipartisan Infrastructure Law have requirements on timing of expended funds, purposes, and contractual expectations. An internal Office of Management and Budget guidance document cannot hide the Department’s obligation to follow the enacted law.

Dissolving contracts, cancelling grants and loans, and reneging on loan guarantees without any intention to execute the laws is not only illegal, but is harmful to the public and energy consumers. Your indiscriminate cancellations of spending will increase energy prices, make our grid less secure, and stop energy innovation. If the Department has a policy disagreement and does not want to spend money on programs Congress has funded, the lawful response is to ask Congress to rescind that funding. The decision ultimately rests with Congress, not with the President, the Department of Energy, or the Department of Government Efficiency. Please provide us a detailed list and briefing that identifies which grants, loans, or loan guarantees you believe should be rescinded and why you think they should be rescinded.

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