Trump Administration Terminates Clean Energy Projects and Freezes New York Infrastructure Funding Amid Government Shutdown

US President Donald Trump's administration has unveiled plans to cancel numerous clean energy initiatives and suspend billions in funding for major New York infrastructure projects, escalating tensions with Democrats amid the ongoing government shutdown.

Multiple US media sources have characterized these announcements from the energy and transportation departments as strategic moves to pressure congressional Democrats into reaching a shutdown resolution.

President Trump had already begun implementing conservative policy changes before the shutdown commenced Tuesday at midnight, threatening widespread dismissals and departmental cuts while attributing the funding impasse to Democratic opposition.

On Thursday, the Department of Energy revealed "the termination of 321 financial awards supporting 223 projects, resulting in a savings of approximately $7.56 billion for American taxpayers."

The department stated that these projects—managed by the Office of Clean Energy Demonstrations, the Office of Energy Efficiency and Renewable Energy, and other agencies—"did not adequately advance the nation's energy needs... and would not provide a positive return on investment of taxpayer dollars."

The statement noted that federal funding recipients have 30 days to challenge termination decisions, with some already initiating appeals. Specific projects were not identified in the announcement.

Russell Vought, director of the Office of Management and Budget, described the eliminated projects on X as "Green New Scam funding" used to promote "the Left's climate agenda."

Vought listed affected states including California, New York, and 14 others—all Democratic-leaning states that Trump failed to win in the 2024 presidential election.

California Governor Gavin Newsom stated that the Trump administration had decided to cancel "up to $1.2 billion" allocated for a major hydrogen energy project, endangering tens of thousands of jobs.

"In Trump's America, energy policy is set by the highest bidder, economics and common sense be damned," Newsom declared, pledging to maintain California's "clean energy strategy... no matter what DC tries to dictate."

In New York—home to Senate Democratic leader Chuck Schumer and House Minority Leader Hakeem Jeffries—the Department of Transportation announced Wednesday it was suspending nearly $18 billion in federal funding for two major infrastructure projects: the Second Avenue subway and Hudson Tunnel.

The department's statement targeted diversity, equity, and inclusion policies, claiming that subsidizing projects with "race- and sex-based contracting requirements... is unconstitutional, counter to civil rights laws, and a waste of taxpayer resources."

The funds will remain frozen until a "quick administrative review is complete," with the statement adding: "Thanks to the Chuck Schumer and Hakeem Jeffries shutdown, however, USDOT's review of New York's unconstitutional practices will take more time," noting that the department "has been forced to furlough the civil rights staff responsible for conducting this review."

New York Governor Kathy Hochul, a Democrat, condemned the funding suspension for "critical infrastructure projects" as "political payback and an attack on New York."

"Donald Trump has been clear: he is intent on using his reckless government shutdown to hurt the American people," she stated.