California Sues Over $1.2 Billion Clean Energy Federal Fund Cuts

California Attorney General Rob Bonta (D) sued the Trump administration Wednesday over its decision to cut $1.2 billion in federal funding for the state’s clean energy hydrogen projects hub.

The lawsuit filed in the US District Court for the Northern District of California said the Department of Energy is illegally cutting funds that were appropriated by Congress in 2021 and 2022.

Colorado Attorney General Phil Weiser (D) and Washington Attorney General Nicholas Brown (D) are co-leads on the lawsuit, which was joined by another 10 state attorneys general in challenging the cuts.

The lawsuit said that soon after President Donald Trump took office last year, the DOE compiled a “hit list” of energy and infrastructure funds to eliminate in accordance with his directives for “Terminating the Green New Deal.” The agency largely targeted Democratic-leaning states, the suit said, and announced the cuts last fall.

The $1.2 billion in federal funding for California went toward the Alliance for Renewable Clean Hydrogen Energy Systems, known as ARCHES, a public-private partnership hub that sought to replace fossil fuels with clean hydrogen in utilities, public transit, and port operations. The cuts would result in over 200,000 union jobs being lost, the lawsuit said.

“The President is cherry-picking this funding at the expense of hardworking Americans and stifling innovation and the economy for the sake of partisan retribution,” Bonta said in a press released. The suit marks his 58th against the administration since Trump took office in January 2025.

The complaint said the DOE’s elimination of the funds, which were granted by Congress under the 2021 Bipartisan Infrastructure Act and the 2022 Inflation Reduction Act, violates the separation of powers and the Administrative Procedure Act.

The case is State of California v. Wright, N.D. Cal., No. 3:26-cv-01417, 2/18/26.