U.S. Secretary of Energy Chris Wright announced today the termination of 24 awards managed by the Office of Clean Energy Demonstrations (OCED), a move the Department of Energy (DOE) states will save over $3.6 billion in taxpayer funds. The cancelled projects, which amounted to over $3.7 billion in potential taxpayer-funded financial assistance, primarily focused on carbon capture and sequestration (CCS) and other decarbonization initiatives.
According to the DOE, an “individualized financial review” of each award determined that the projects “failed to advance the energy needs of the American people, were not economically viable and would not generate a positive return on investment of taxpayer dollars.”
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A significant point highlighted in the announcement is the timing of the original awards, with the DOE noting that nearly 70% (16 of the 24 projects) were signed between Election Day and January 20th of the previous administration.
“While the previous administration failed to conduct a thorough financial review before signing away billions of taxpayer dollars, the Trump administration is doing our due diligence to ensure we are utilizing taxpayer dollars to strengthen our national security, bolster affordable, reliable energy sources and advance projects that generate the highest possible return on investment,” stated Secretary Wright. “Today, we are acting in the best interest of the American people by cancelling these 24 awards.”
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The decision to terminate the awards follows a new departmental policy, “Ensuring Responsibility for Financial Assistance,” issued via a Secretarial Memorandum earlier this month. This memorandum outlined the DOE’s process for evaluating financial assistance on a case-by-case basis. The criteria for evaluation include identifying potential waste of taxpayer dollars, protecting U.S. national security, and advancing President Trump’s agenda to promote affordable, reliable, and secure energy.
The DOE confirmed that this review process was applied to each of the 24 now-cancelled awards, leading to the conclusion that they did not meet the economic, national security, or energy security standards required to justify continued DOE investment. The termination is expected to generate an immediate $3.6 billion in savings.
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