Facing $32 million in federal cuts, Austin looks to self-fund rooftop solar

AUSTIN, Texas — With the Trump administration entering its second year, U.S. energy policy looks completely different than it did 13 months ago. In a departure from his predecessor’s priorities, President Donald Trump has pulled grant funding from state and local governments that would have funded renewable energy and environmental projects. 

In April 2024, the Environmental Protection Agency awarded $250 million in solar grant funding to Texas municipalities, including a $32 million promise to Austin, as part of the agency’s $7 billion Solar for All program. It didn’t last long: In August 2025, the EPA announced all $7 billion in funding would be rescinded, along with another $20 billion for the EPA’s larger Greenhouse Gas Reduction fund. 

At the Department of Energy, officials have also axed $7.6 billion in projects benefitting states that voted for former vice president Kamala Harris in the 2024 presidential election, and had Democratic governors at the time. The DOE also terminated $3.7 billion in energy grants last May. 

In total, the Trump administration has attempted to cancel around $40 billion in federal grants. For cities such as Austin, Texas, cancellations threw a wrench into plans to expand access to solar power for local communities. 

Now, Austin officials are finding ways to continue pursuing energy projects without depending on federal funds. At a time when federal support for renewables is on a downward spiral, Austin has managed to invest in rooftop solar for publicly-owned buildings and incentivize commercial landowners to invest in panels. 

What’s the justification for cancelling grants? 

Federal officials have said cancelling grants is about fiscal responsibility and aligning spending with new policy priorities. 

EPA administrator Lee Zeldin criticized the Biden administration’s grant selections for “instances of self-dealing and conflicts of interest, unqualified recipients and intentionally reduced agency oversight.” 

A Justice Department investigation of Biden’s EPA did not find evidence of criminal activity. Nevertheless, the perception of improperly handling funds has persisted, driven largely by a 2024 video of an EPA staffer comparing the agency’s work to being “on the Titanic and we’re throwing gold bars off the edge.”

The video, secretly recorded during what the EPA staffer, Brent Efron, thought was a first date, was published by right-wing activist group Project Veritas. Efron later told the New York Times he regretted his choice of words. 

In an October announcement cancelling projects in 16 blue states, Energy Secretary Chris Wright said the $7.6 billion in projects were “rushed through in the final months of the Biden administration with inadequate documentation by any reasonable business standard.”

How did losing grant funding impact Austin? 

The city of Austin planned to use Solar for All funding to help 3,000 low-income families access rooftop solar. 

“Having that grant canceled was like getting the rug pulled out from you,” Vanessa Fuentes, an Austin City Council member representing the predominantly Latino District 2, told Straight Arrow News. 

While Austin’s city council seats are technically nonpartisan, each of the 11 current members is a Democrat or progressive. Many have previously held partisan office or run for office as Democrats, and others are former staffers for Democrats. 

“A lot of time and effort was put into” the grant, Fuentes told SAN. Multiple jurisdictions collaborated on the grant application; when funding was awarded, staff worked to determine which households could qualify and how to get the word out to communities to apply. 

Council Member Ryan Alter, representing central south Austin’s District 5, said with the combination of lost grant funding and rollbacks to tax credits, the impact is “worse than we thought.” 

“This was solar capacity locally that we were planning on, we thought we were going to have,” Alter told SAN. “So we now have to find a way to bridge that gap. That costs money.” 

What are the reactions to funding cancellations? 

Pennsylvania showed early on that lawsuits could work when the state won back over $2 billion in funding originally allocated under the 2022 Inflation Reduction Act. Other grant recipients followed — and filed — suit.

More recently, the city of Saint Paul, Minnesota led a lawsuit winning back nearly $30 million in energy funds rescinded last October. The win indicated that other jurisdictions affected by the October cancellation could see funding restored. The judge found that the DOE did not provide adequate justification for rescinding money from some projects while comparable ones in states that voted for Trump continued to receive funding. 

Harris County is currently suing the EPA over the $250 million award for Solar for All. 

John Quigley, a senior fellow at the University of Pennsylvania’s Kleinman Center for Energy Policy, said the loss of federal energy grants is “devastating” for states and cities that “by and large, haven’t moved to replace that funding.” 

Quigley, who previously served as a cabinet official for two democratic governors in Pennsylvania, said the Biden administration’s push to fund renewable energy and domestic manufacturing was “exactly what was needed, and really had immense potential benefit for the country and fully cementing U.S. leadership in the world.”

Now, he is worried about the loss of jobs that federal funds would have helped create, and he’s especially concerned that the U.S. has ceded energy leadership to China. 

“China is deploying more clean energy annually than the U.S. has cumulatively, and they are exporting more of that technology to other countries,” Quigley said. 

Even among Republicans, a group of lawmakers fought last summer to keep some energy tax credits in the spending and taxation bill. Nevertheless, conservatives are generally supportive of the Trump administration’s shift in federal spending priorities.

Travis Fisher, director of energy and environmental policy studies at the Cato Institute, said when the $370 billion Inflation Reduction Act passed he was “alarmed about the massive amount of spending.” A reversal was “bound to happen,” he said. 

Fisher, who embraces a free-market approach to energy policy, said it is “unfortunate” for cities that were counting on federal funding, but he said repeal was the right choice because of the high cost of subsidies and his view that a partisan “one-size-fits-all federal policy” is less effective than local solutions. 

“If you prefer to keep those [energy] programs and you want them to be stable, either they should come from a bipartisan act of Congress or keep it at the state and county level,” Fisher said. 

What is the city doing to keep pursuing clean energy goals? 

Austin’s Climate Equity Plan calls for 100% of its electricity to come from “carbon-free generation” by 2035. That would require city-owned utility Austin Energy to ditch its stake in a nearby coal plant, abandon gas power and pivot to nuclear, batteries and renewable energy sources such as wind and solar. 

“Environmental stewardship, and really just a commitment to addressing climate change, is a quintessential Austin value,” Fuentes said. “It’s deeply embedded in how policymakers get elected and how we govern our city.”

Last May, the city council voted to build 25 megawatts of rooftop solar on city-owned buildings. That’s enough electricity for 3,600 homes, according to planning documents. From city government buildings, to libraries, recreation centers and police and fire stations, the city has identified about 140 properties as potential rooftop solar sites. 

That project is almost ready to get off the ground. City staff are currently reviewing proposals from 16 private solar companies to take on the project, and the council is expected to conduct a final vote this spring.

Austin Energy has also rolled out a new program to increase rooftop solar on commercial buildings. Known as the solar standard offer, the program makes it easier for commercial building owners to partner with solar developers. 

“The building owner gets a little money, the solar provider gets a little money, and the city gets more cheap electricity right here in our load zone,” Alter said.

Austin Energy already has a higher share of solar than other utility companies on the Texas grid, and it has inked a deal to build 125 megawatts of battery storage by 2027 to complement renewable energy. 

“You can’t replace billions of dollars of federal funding,” Quigley said, but “at the end of the day, local leadership can make a big difference.”

The post Facing $32 million in federal cuts, Austin looks to self-fund rooftop solar appeared first on Straight Arrow News.

Ella Rae Greene, Editor In Chief