Climate Nonprofit Sues Trump EPA Over $7 Billion Grant Freeze \ Newslooks \ Washington DC \ Mary Sidiqi \ Evening Edition \ A climate nonprofit awarded $7 billion under Biden’s EPA has sued Trump’s Environmental Protection Agency (EPA) for improperly freezing legally awarded funds. The Climate United Fund, part of the Greenhouse Gas Reduction Fund (GGRF), claims the EPA and Citibank blocked access to its account, preventing clean energy financing. The lawsuit follows EPA Administrator Lee Zeldin’s accusations of waste and fraud, which critics call a politically motivated crackdown on climate investments.
Trump Administration’s EPA and Green Bank Lawsuit Quick Looks
- $7 Billion Grant Frozen: Climate United Fund says the EPA unlawfully blocked funds for clean energy projects.
- Trump’s EPA Crackdown: Administrator Lee Zeldin accuses the Greenhouse Gas Reduction Fund (GGRF) of waste.
- Citibank Named in Lawsuit: Climate United claims the bank cut off account access without explanation.
- Second Lawsuit Filed: The Coalition for Green Capital, awarded $5 billion, also sued Citibank.
- Democrats Call It Political Retaliation: Lawmakers denounce the funding freeze as baseless and harmful.
- Legal Battle Ahead: A hearing is set for Wednesday in U.S. District Court in Washington, D.C.
Deep Look
Green Bank Funds Frozen: Climate Groups Take Legal Action
The Trump administration’s Environmental Protection Agency (EPA) is facing a major legal challenge after allegedly freezing billions of dollars in clean energy funding that had been awarded under Biden’s Greenhouse Gas Reduction Fund (GGRF).
The Climate United Fund, a nonprofit coalition that received nearly $7 billion, has sued the EPA and Citibank, claiming that the agency illegally blocked access to its funds, preventing it from issuing loans and paying employees.
In a separate lawsuit, the Coalition for Green Capital, which was awarded $5 billion, also sued Citibank for allegedly breaching its contract by refusing to release the grant funds.
Both lawsuits argue that the funding freeze violates congressional mandates and is part of a politically motivated effort by the Trump administration to dismantle climate programs.
“The combined actions of Citibank and the EPA effectively nullify a congressionally mandated and funded program,” Climate United said in its Monday court filing.
Trump’s EPA Takes Aim at the Green Bank
The Greenhouse Gas Reduction Fund (GGRF), also known as the “green bank,” was created in 2022 through the Inflation Reduction Act, a bipartisan effort to finance clean energy and climate-focused projects.
While favored by Democrats, the $20 billion program has been heavily criticized by Republicans, with some calling it an unaccountable “slush fund.”
Lee Zeldin, who was confirmed as Trump’s EPA Administrator in January, has been one of the green bank’s fiercest critics.
- In a video posted on X (formerly Twitter), Zeldin declared that the EPA would revoke contracts for the program.
- He cited an undercover video recorded by a conservative journalist, in which a former EPA employee allegedly said the agency was “throwing gold bars off the Titanic”—a phrase Zeldin has since used to describe climate fund spending.
- Zeldin has repeatedly accused GGRF recipients of misconduct, waste, and possible fraud, though no formal evidence of wrongdoing has been presented.
According to Climate United’s lawsuit, Citibank cut off access to its account on February 18, without explanation, shortly after Zeldin publicly attacked the program.
Democratic Lawmakers Condemn Funding Freeze
The EPA’s actions have drawn strong criticism from Democratic lawmakers, who argue that Trump’s administration is deliberately obstructing climate investments.
Senator Chris Van Hollen (MD), Senator Ed Markey (MA), and Representative Debbie Dingell (MI)—three lawmakers who helped create the green bank—issued a joint statement Monday, condemning the funding freeze.
“The Trump administration’s baseless attacks on these investments will only cost jobs, increase prices, and harm our communities.”
They labeled Zeldin’s investigation into the green bank a political sham, intended to undermine clean energy funding.
Citibank Under Fire for Blocking Funds
Citibank, which managed the federal funds as a financial agent, is also at the center of the controversy.
In a statement, Citibank said it was reviewing Climate United’s lawsuit and insisted that it was cooperating with the federal government.
“Our role as financial agent does not involve discretion over which organizations receive grant funds. Citi will, of course, comply with any judicial decision.”
However, legal experts say the bank’s involvement raises questions, particularly because it withheld funds without an official directive from a court or Congress.
High-Profile Resignation Over the Funding Freeze
Climate United’s lawsuit also revealed new details about internal government pressure to halt green bank funding.
- Denise Cheung, a senior prosecutor at the U.S. Attorney’s Office in Washington, D.C., resigned after refusing to comply with Trump administration demands to freeze the climate groups’ assets.
- Cheung’s resignation letter suggested political interference in federal funding decisions, a claim that could play a key role in the lawsuit.
Trump Singles Out Stacey Abrams’ Ties to Green Bank
In a speech to Congress last week, Trump personally attacked former Georgia gubernatorial candidate Stacey Abrams, pointing to her affiliation with one of the green bank recipients as evidence of Democratic corruption.
- Zeldin echoed those concerns, questioning whether some climate fund recipients had political ties to the Biden administration.
- The EPA is now investigating the fund’s allocation process, further delaying the release of the money.
What’s Next? Legal Battle Over Climate Funding Intensifies
The lawsuit over the EPA’s decision to freeze $7 billion in clean energy grants could set a major legal precedent for how future administrations handle congressionally approved funding.
A hearing is scheduled for Wednesday in U.S. District Court in Washington, D.C., where the judge will decide whether the funds must be released immediately or remain blocked pending further investigation.
Climate finance experts warn that the Trump administration’s actions could undermine long-term investments in clean energy, potentially derailing thousands of renewable energy projects.
“The resources have already been spent, which means they’re trying to come up with pretexts to do something the government is not supposed to do—which is claw back resources Congress has already allocated,” said Ilmi Granoff, a climate finance expert at Columbia University.
The case could also set the stage for broader legal battles over Trump’s aggressive efforts to dismantle Biden-era climate policies.
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