Green Bank Litigation Update
There has been a recent uptick of activity in Green Bank litigation in the federal district courts and the U.S. District Court of Appeals for the DC Circuit. The DC Circuit Court of Appeals, like other circuit courts, hears appeals from the U.S. district courts. However, the DC Circuit Court of Appeals has a broader purview than other circuit courts because it has jurisdiction over a wide range of federal law, including numerous federal agency decisions.
Nothing in this summary should lead the reader to believe that a rapid resolution of Green Bank litigation is imminent. The Sabin Center for Climate Change Law at Columbia University is tracking seven major federal cases contesting the fate of $20 billion in funding for the National Clean Investment Fund (NCIF) and the Clean Communities Investment Accelerator (CCIA). See NCIF/CCIA Database Tracker Here. The Sabin Center is also following twenty-six federal cases involving disputes over $7 billion in Solar for All funding. See Solar for All Database Tracker Here.
Many legal observers anticipate that one or more of these cases will ultimately be decided by appeals to the U.S. Supreme Court. The purpose of this update is to highlight a small (hopefully, representative) set of recent federal district and appeals court activities and identify some emerging themes & arguments in the Green Bank court cases.
Background
In 2022, the United States Congress passed the Inflation Reduction Act (IRA), appropriating an unprecedented amount of money for climate spending programs. One of the IRA’s flagship investments was the Greenhouse Gas Reduction Fund, a $27 billion program comprised of the National Clean Investment Fund and the Clean Communities Investment Accelerator (combined $20 billion), and Solar for All (SFA) ($7 billion). The PA Energy Development Authority (PEDA) was awarded $156 million through the Solar for All program.
An over-summarized version of the competing arguments in the thirty-three federal Green Bank lawsuits might include the following issues:
- The Plaintiffs argue that the NCIF/CCIA/ SFA Green Banks should have access to funds and be allowed to operate because these programs were fully implemented by September 30, 2024, in full compliance with Congressional intent in the IRA.
- The Defendants maintain that the Green Banks were not implemented in an appropriate manner, and to the extent that there is a dispute about current funding – those are contract claims to be resolved at the U.S. Court of Claims. To the extent relevant, Congressional intent was conclusively expressed in the Big Beautiful Bill in July 2025 when it repealed authorization and funding for Green Banks.
For a less sanitized version of the Trump administration’s views, EPA’s official description of the Greenhouse Gas Reduction Fund can be found Here.
March-April 2026 – Court Hearings & Interim Orders
Continued Freeze of Green Bank Funds at Citibank:
Judge bars Trump’s EPA from taking back $20B in climate grants – for now – by Zack Colman – Politico – March 18, 2026 – U.S. District Judge Tanya Chutkan temporarily blocked the EPA’s attempt to recoup $20 billion in Biden-era climate grants. But rather than declare a winner, Tuesday’s decision was merely aimed at preserving the status quo, Chutkan said. Her order does not immediately restore access to the groups’ accounts, nor does it officially kill EPA’s right to press for contract terminations in the future.
Judges Order Federal Agencies to Unfreeze Climate Money – By Claire Brown and Karen Zraick – New York Times – April 16, 2025 – Two court rulings on Tuesday unfroze hundreds of millions of dollars in federal climate funds, a win for nonprofit groups that have been denied access to money they were promised under the Biden administration.
Appeals court temporarily halts disbursement of contested climate funds – by Rachel Frazin – The Hill – April 17, 2026 – An appeals court has temporarily halted a lower court’s order to release contested climate funds. Earlier this week, District Judge Tanya Chutkan blocked the EPA from clawing back billions of dollars in climate funds given to Green Banks during the Biden administration. Her order directed Citibank to release the funds to the Green Bank groups as soon as Thursday. However, late Wednesday a panel of appeals court judges ordered that the funds should neither be returned to the U.S. Treasury Department nor released to the climate organizations to allow time to consider the case.
Federal judge questions whether EPA move to rapidly cancel ‘green bank’ grants was legal – by MICHAEL PHILLIS – Associated Press – April 2, 2025 – A federal judge on Wednesday pressed an attorney for the EPA about whether the agency broke the law when it swiftly terminated $20 billion worth of grants awarded to nonprofits for a green bank by allegedly bulldozing past proper rules and raising flimsy accusations of waste and fraud. Chutkan noted that EPA allegedly demanded Citibank stop providing funds that had already been awarded without letting the nonprofits know – “Is that lawful?” she asked.
DC Circuit Court of Appeals – Full Panel Hearing on EPA’s Termination of Grants
Full DC Circuit grills DOJ over effort to claw back billions in green energy funds – by Ryan Knappenberger – Courthouse News Service – February 24, 2026 – The full D.C. Circuit appeared split on Tuesday over whether it should vacate a preliminary injunction finding the Trump administration wrongfully gutted a Biden-era program meant to fund smaller climate projects by setting up intermediary investment funds. The En Banc panel was called back to the case, after a smaller panel indicated the Trump administration could claw back nearly $16 billion in grants, by a group of “green banks” who argued that the EPA had unlawfully gutted the Greenhouse Gas Reduction Fund without proper explanation.
Order entered March 9, 2026 – Argued at the DC Court of Appeals on March 20, 2026 – “The parties are directed to submit supplemental briefs addressing whether, in light of Section 60002 of the One Big Beautiful Bill Act, Pub. L. No. 119-21(2025), that [Green Bank] claims continue to provide a valid basis to affirm all or part of the preliminary injunction.” The Full Panel of the DC Court of Appeals has not yet issued a final decision in the Climate United case (more details are provided below).
Analysis: Can the DC Court of Appeals Revive a Grant Program?
One Year After Green Bank’s Demise, Court Mulls Future of Grant Based Climate Policy by Marianne Lavelle – Inside Climate News – March 11, 2026 – After years of failed efforts to get a greenhouse gas emissions plan through Congress, Democrats during the administration passed climate legislation in 2022 based entirely on government incentives – carrots, not sticks. The Green Bank case will likely decide whether any future Congress can effectively use federal grants to jump-start the clean energy economy, in a nation where it has proven so difficult to garner political support for policy that would place direct limits on the use or production of fossil fuels. “The Inflation Reduction Act was an interesting and innovative statute that sought to achieve big policy goals through the use of fiscal incentives,” said William Buzbee, environmental law professor at Georgetown University Law School. “If, in the end, the law allows the government to demolish regulation via grants, then this kind of strategy doesn’t have a long shelf life.”
Green Bank Litigation: Two Deeper Dives on the Arguments & Issues
Two excellent summaries of the state of play of the thirty-three Green Bank cases
Uncertain Remedies for Frozen Federal Climate Funding – by Vincent Colette & Romany Webb – Columbia Sabin Center for Climate Change Law – March 6, 2026.
This blog discusses the factual and litigation background of Climate United & examines three possible outcomes the panel discussed during oral arguments.
On February 24, 2026, the U.S. Court of Appeals for the District of Columbia Circuit held oral arguments in the case Climate United Fund v. Citibank to consider the future of almost $20 billion in climate funding appropriated under the Inflation Reduction Act (IRA). Now before the full court of appeals, at issue is whether to affirm the preliminary injunction that the District Court granted in April 2025. That injunction barred EPA from effectuating grant terminations and required the disbursement of frozen funds for two of the three programs within the IRA’s Greenhouse Gas Reduction Fund (GGRF): (1) the National Clean Investment Fund (NCIF) and (2) the Clean Communities Investment Accelerator (CCIA).
With this backdrop, on February 24, 2026, the parties participated in an oral argument that lasted almost three hours. In appeals like this, the D.C. Circuit reviews the district court’s preliminary injunction “for abuse of discretion, its underlying legal conclusions de novo, and its findings of fact for clear error.” Huisha-Huisha v. Mayorkas, 27 F.4th 718, 726 (D.C. Cir. 2022).
The court considers the same preliminary injunction factors that the district court applied, which requires the plaintiffs to establish that “they are likely to succeed on the merits, that they are likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in their favor, and that an injunction is in the public interest.” Winter v. NRDC, 555 U.S. 7, 20 (2008) (cleaned up).
It appeared that the judges broadly converged around three possible outcomes to decide the rehearing: (1) Plaintiffs’ claims are really contract disputes that belong in the Court of Claims; (2) EPA’s actions violated the separation of powers doctrine but the Court’s ability to grant relief may be affected by the enactment of the Big Beautiful Bill; or (3) EPA’s actions violated the Administrative Procedures Act but the Court’s ability to grant relief may be affected by the enactment of the OBBA. The range of possible outcomes underscores both the novelty and complexity of the case.
Four Solar for All Lawsuits: Two Distinct Forums and Legal Theories – by Vincent Nolette – Columbia Sabin Center for Climate Change Law – October 31, 2025
This blog discusses the factual & litigation background of state-based arguments as to why EPA’s efforts to dismantle the Solar for All program are unlawful.
In 2022, the U.S. Congress passed the Inflation Reduction Act (IRA), appropriating an unprecedented amount of money for climate spending programs. As part of the IRA – Solar for All was a $7 billion program intended to expand access to greenhouse gas-reducing technologies – primarily distributed and community solar—to low-income and disadvantaged communities. If fully implemented, the EPA projected that SFA would reduce energy bills for more than 900,000 households, while also improving local air quality and helping to mitigate climate change, among other benefits.
State AGs Bring Breach of Contract Claims in the Court of Federal Claims – In Maryland Clean Energy Center, et al. v. United States, Docket No. 25-cv-1738 (filed October 15, 2025), a coalition of 22 state attorneys general and the District of Columbia are arguing that EPA unilaterally terminated competitive SFA grants in breach of contract, and are seeking money damages. The U.S. is the named defendant in this case because the Court of Federal Claims is the court that has jurisdiction over contract disputes against the federal government seeking monetary damages. Under the Tucker Act, the Court of Federal Claims cannot provide injunctive relief in general breach of contract cases. Note: The PA Energy Development Authority is a Plaintiff in the Maryland Clean Energy Center case.
District Court Lawsuits – Unlike Court of Federal Claims lawsuits, which seek compensation for breach of contract, the district court Plaintiffs challenge EPA’s action under the Administrative Procedures Act (APA) and the Constitution.
One example of an APA/constitutional law case is Rhode Island AFL CIO, et al. v. EPA, et al., (filed October 6, 2025, District of RI). In this case, the plaintiffs are several intended beneficiaries of SFA (i.e., groups that would have been able to take advantage of the financial & technical assistance programs developed by SFA awardees). The plaintiffs are challenging EPA’s termination of the SFA program under (1) the Administrative Procedure Act claims, alleging that EPA’s action was in excess of statutory authority and arbitrary and capricious; and (2) the Constitution, arguing that EPA violated the separation of powers doctrine and the Presentment Clause. The plaintiffs also filed a petition for review in the D.C. Circuit as a protective measure in case that court is deemed the proper venue. Note: Solar United Neighbors is a Plaintiff in this case.
Conclusion: While states and others have made strong arguments as to why EPA’s efforts to dismantle the program are unlawful, it remains to be seen how the courts will view those arguments. And even if they are ultimately receptive to plaintiffs’ arguments, significant damage has already been done in the meantime. Although judicial relief would be a second-rate outcome, it is now the best that can be hoped for.
An Unrelated Case Before the US Supreme Court May Turn on Similar Procedural Issues That Green Banks Have Argued in Federal Courts
I Almost Never Predict Supreme Court Outcomes. Trump Will Lose This Case – by Linda Greenhouse – April 16, 2026 – New York Times – Trump v. Miot and Mullin v. Doe have been consolidated for a single argument on April 29, 2026 and the Haitian and Syrian Plaintiffs remain protected against deportation, free to work legally and live openly….Decades of writing about the Supreme Court have taught me that it’s foolish to predict the outcome of cases, and I have rarely done so. My prediction here rests on one word: procedure.
