US Cancels 24 Clean Energy Projects Valued $3.7 Billion

US Secretary of Energy Chris Wright has announced the termination of 24 awards issued by the Office of Clean Energy Demonstrations (OCED) totalling over $3.7 billion in taxpayer-funded financial assistance.

After a thorough and individualised financial review of each award, Department of Energy (DOE) found that these projects failed to advance the energy needs of the American people, and were not economically viable and would not generate a positive return on investment of taxpayer dollars.

Of the 24 awards cancelled, nearly 70% (16 of the 24 projects) were signed between last year’s Election Day and January 20 of this year. The projects primarily include funding for carbon capture and sequestration (CCS) and decarbonisation initiatives. By terminating these awards, DOE is generating an immediate $3.6 billion in savings for the American people.

According to a Bloomberg report, the list of terminated awards includes $331 million previously allocated to Exxon Mobil Corp. for a hydrogen initiative at its Baytown, Texas refinery; $170 million intended for Kraft Heinz Co. (KHC) to support multiple clean energy developments; and $500 million designated for Heidelberg Materials AG to fund a low-carbon cement project.

Additional awards revoked include $375 million for Eastman Chemical Co. (EMN)’s molecular recycling facility in Longview, Texas, and two separate $270 million grants to Calpine Corp. subsidiaries for carbon capture projects in Baytown, Texas, and near Yuba City, California, the report said.

Following Due Diligence

Wright said that while the previous administration failed to conduct a thorough financial review before signing away billions of taxpayer dollars, the Trump administration is doing due diligence to ensure the government is utilising taxpayer dollars to strengthen national security, bolster affordable, reliable energy sources and advance projects that generate the highest possible return on investment.

He added: “Today, we are acting in the best interest of the American people by cancelling these 24 awards.”

It may be recalled that DOE has issued a Secretarial Memorandum entitled, “Ensuring Responsibility for Financial Assistance,” a fortnight ago which outlined DOE’s policy for evaluating financial assistance on a case-by-case basis to identity waste of taxpayer dollars, protect America’s national security and advance President Trump’s commitment to unleash affordable, reliable and secure energy for the American people.

DOE utilised this review process to evaluate each of these 24 awards and determined that they did not meet the economic, national security or energy security standards necessary to sustain DOE’s investment.