Trump's energy grant audit

Today's newsletter looks at President Donald Trump's plan to turn up the scrutiny on billions of dollars in grants meant to help upgrade power grids and energy technology manufacturing. You can read and share the full story on Bloomberg.com. For unlimited access to climate and energy news, please subscribe.

A fresh wave of scrutiny

By Jennifer A Dlouhy

President Donald Trump's administration is deepening its review of more than $15 billion in grants and other support awarded by its predecessor for upgrading power grids and manufacturing energy technology.

Energy Secretary Chris Wright is ordering the stepped-up scrutiny, with a plan for case-by-case reviews to ensure projects that won funding under former President Joe Biden are financially sound, aligned with US economic and security interests and consistent with the Trump administration's policies, according to documents seen by Bloomberg News.

The reviews will cover projects for modernizing the power grid, making batteries in the US and building other energy technology domestically. Financial support for those that don't meet the new standards could be modified or terminated, according to a new policy statement.

Trump has been a sharp critic of what he calls the "Green New Scam," referring to hundreds of billions of dollars in government subsidies for low- and zero-emission technology. He's also trained heavy fire on policies buttressing offshore wind and electric vehicles, while cheering on the use of oil, gas and coal. And Trump allies have complained that Biden's team rushed funding out the door in its final weeks.

Energy Secretary Chris Wright. Photographer: Pete Kiehart/Bloomberg

An initial review is focused on 179 projects that have won financial assistance from Energy Department offices focused on power grids and domestic manufacturing. But the plan also sets the stage for potentially more audits of tens of billions in additional support awarded to auto companies, power utilities, biofuel producers and other ventures.

The effort, compelling companies to supply new documentation on demand — with the risk of cancellation for not swiftly complying within 30 days — could be a powerful tool to pull back support from projects that run counter to Trump's policy priorities.

Not only could the Energy Department withdraw funding for projects that fall short of the new standards, it is also threatening to terminate grants where recipients fail "to respond to follow-up questions in a timely manner" or provide "incomplete responses." In those instances, the department may treat "the recipient's refusal to cooperate as grounds for termination of the award or the withholding of funding," the policy says.

The new policy is "essential to identifying and avoiding fraud, waste and abuse," according to the energy secretary's order.

To learn more about the new round of audits and how they could impact the energy industry, read the full story.

An even bigger target

$400 billion

Roughly the amount the Energy Department's green bank has in lending authority, thanks to an infusion of IRA funds. The program has come under fire from the Trump administration.

Potential legal issues

"If it's been dispersed, I don't know how you can claw it back. It seems like that's very difficult."

Kevin Book

Managing director, ClearView Energy Partners

While it would be possible, any attempt to claw back money would likely be met with legal challenges.

Basel resists pressure to downplay climate

By Alastair Marsh and Laura Noonan

US efforts to rein in the Basel Committee's focus on climate risks were met with a rare show of resistance this week, according to people familiar with the matter.

At a closed-door meeting that took place on Monday, the heads of the central banks and regulators that make up the Basel Committee on Banking Supervision rejected a proposal to dissolve the taskforce overseeing climate work, said the people, who asked not to be identified disclosing confidential conversations.

The upshot is that the Task Force on Climate-related Financial Risks (TFCR) won't be disbanded, the people said. However, its long-term fate remains unclear, as TFCR now risks becoming a bargaining chip in future talks with the US on Basel III implementation, they added. The US has yet to adopt the final package of Basel III bank reforms, which other countries agreed to implement back in 2023.

Fed Chair Jerome Powell. Photographer: Tierney L. Cross/Bloomberg

It's the latest standoff amid ongoing disagreements within the Basel Committee on how to treat climate risk. While the European Central Bank continues to stress the importance of addressing the financial dangers posed by the fallout of a hotter planet, US regulators led by the Federal Reserve have pushed back on efforts to make climate risk a focus of global financial rules.

The future of the Basel Committee's climate work was discussed at Monday's meeting by its oversight body, the so-called Group of Central Bank Governors and Heads of Supervision, or GHOS, which is chaired by Bank of Canada Governor Tiff Macklem. GHOS looked at several proposals on a new approach for climate work put forward by Erik Thedéen, chair of the Basel Committee.

To learn more about the Basel Committee's work on climate risk, read the full story.

More from Green

Chinese solar companies will continue their expansion into emerging overseas markets during a 90-day tariff truce between the US and China that brings a more stable trade environment, company executives said at online investor briefings.

Barclays' global head of debt capital markets said the British bank has made an effort to focus more on environmental, social and corporate governance issues as many lenders it competes with have moved in the opposite direction.

The European Union will work on setting minimum performance standards to curb water usage in data centers as the continent confronts potential shortages over the coming decades.

Worth a listen

Low-carbon tech investments reached $2.1 trillion last year. But with the whole world trying to work out how to navigate US President Donald Trump's unpredictable policy agenda, is 2025 still a good time to invest in climate tech? This week on Zero Akshat Rathi interviews Greg Wasserman, head of private company climate investment at Wellington Management, which oversees more than $1 trillion in assets. Wasserman has to make investment decisions here and now about companies and technologies — weighing risks and opportunities in a volatile market. Listen now, and subscribe on Apple, Spotify, or YouTube to get new episodes of Zero every Thursday.