19 states sue EPA to reinstate $7 billion of Solar for All funding
The lawsuit alleges that EPA’s cancellation of Solar for All grants violated a federal law and a provision of the U.S. Constitution, and asks the court to reinstate the grants. A second lawsuit seeks reimbursement for damages sustained by grant awardees when the grants were canceled.
October 21, 2025 William Driscoll
Technicians working on a solar panel installation.
Image: Wikimedia Commons / Stephen Yang / The Solutions Project / CC SA 2.0
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Washington State and 18 other states have filed a lawsuit against the U.S. Environmental Protection Agency, seeking to restore $7 billion worth of Solar for All grants.
The grants were expected to support more than 4 GW of solar, serving 900,000 households in low-income and disadvantaged communities and reducing customer bills by at least 20%.
EPA competitively awarded Solar for All grants in August 2024 to 49 state-level agencies, six Native American tribes or tribal consortiums, and five multi-state applicants.
But two months ago, said the Washington State Attorney General’s Office in a statement, “EPA abruptly and unlawfully terminated the program and clawed back the vast majority of the money already awarded. That has left the plaintiffs without access to the funds to proceed” with solar deployment.
The lawsuit says that Congress passed the “One Big Beautiful Bill Act” in July rescinding unobligated funds for the program, but that EPA had obligated all of the $7 billion for the program nearly a year earlier.
The lawsuit alleges that the EPA “unlawfully” froze all Solar for All funds in violation of the Administrative Procedure Act and the U.S. Constitution’s Separation of Powers Doctrine.
In its statement, the Attorney General’s Office said that EPA “sent memos to all grant recipients, saying EPA no longer has a ‘statutory basis or dedicated funding’ for the program, even though Congress never directed EPA to cancel funds that had already been awarded. In fact, Congress did the opposite by only rescinding unobligated funds for Solar for All.”
The lawsuit was filed in the U.S. District Court for the Western District of Washington.
Second lawsuit
The California Public Utilities Commission and other plaintiffs including 15 states have filed a lawsuit against EPA, alleging that EPA, after signing contracts to issue the Solar for All grants, then breached those contracts.
That lawsuit alleges that EPA’s breach of the 60 Solar for All grant agreements caused each plaintiff to suffer damages, and asks the U.S. Court of Federal Claims to award monetary damages to the plaintiffs.
In response to both lawsuits, EPA commented that “in keeping with a longstanding practice, EPA does not comment on any current or pending litigation.”
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