The Energy Department announced on Friday that it was terminating $3.7 billion in Biden-era awards to companies trying to demonstrate technologies that might one day help tackle global warming.
Some of the 24 canceled awards would have gone to industrial companies that were aiming to reduce emissions from cement, iron, glass and chemicals production. Others had been awarded to fossil fuel and cement companies attempting to trap and bury carbon dioxide from their smokestacks before the gas escapes into the atmosphere and heats the planet.
Two of the terminated awards, worth $540 million in all, would have gone to Calpine, one of the nation’s largest producers of electricity, which was trying to capture and store the carbon from two large natural gas power plants in Yuba City, Calif., and Baytown, Texas.
Also on the chopping block was a $331 million award to the oil giant Exxon Mobil, which had been planning to replace natural gas with lower-emissions hydrogen at a chemical facility in Baytown, Texas.
In announcing the cuts, the Energy Department said in a statement that the projects “failed to advance the energy needs of the American people, were not economically viable and would not generate a positive return on investment of taxpayer dollars.”
“Today, we are acting in the best interest of the American people by canceling these 24 awards,” Energy Secretary Chris Wright said. He said that the previous administration had “failed to conduct a thorough financial review” of the spending and suggested the process had been rushed, noting that 16 of the awards had been made between Election Day and President Trump’s inauguration on Jan. 20.
Congress had approved tens of billions of dollars for trials of novel energy technologies as part of the 2021 bipartisan infrastructure law. The goal was to demonstrate promising techniques for cutting emissions so that companies would later invest in them.
The Biden administration had worked to award most of those funds before President Trump came into office, including $6 billion for technologies to cut industrial emissions. Many of the awards were legally binding, but they often had conditions attached to them and most of the money has yet to be spent.
At a Senate hearing last week, Mr. Wright said he wanted to review all Biden-era awards closely. The Trump administration has sought to drastically scale back the federal role in addressing climate change.
This month, the Energy Department announced that it would scrutinize a separate batch of 179 awards worth $15 billion, including funding to upgrade electric grids and promote domestic battery manufacturing. The agency said it would demand extensive information from awardees and warned that failure to respond adequately could be used as grounds for termination. The agency has not announced the results of that review.
Some experts said that canceling efforts to test novel technologies would leave the United States at a competitive disadvantage.
“Many of these projects involve new ways to make cement or chemicals, and they’re things that China and other countries are already investing in,” said Evan Chapman, senior director of policy at Clean Tomorrow, a nonprofit organization focused on technological innovation in energy. “If we’re not making these investments, we’ll be losing the race to develop and demonstrate and deploy these advanced technologies.”
Mr. Chapman pointed out that China has recently announced more than 100 energy demonstration projects, which included new ways to make clean-burning hydrogen fuels or low-carbon steel.
Other awards canceled by the Energy Department on Friday include: $500 million to Heidelberg Materials, a cement manufacturer that aims to capture and bury the carbon dioxide emissions from a large cement plant in Indiana; $189 million to Brimstone, a company trying to reduce emissions from cement by changing the ingredients, using carbon-free silicate rock instead of limestone; and $170.9 million to Kraft Heinz, a food manufacturer, which had planned to install electric boilers and heat pumps to generate the large amounts of heat needed for things like drying macaroni without directly burning fossil fuels.
The Energy Department still oversees tens of billions of dollars that it has obligated for a wide variety of other energy projects, including hubs to produce hydrogen fuels and to pull carbon dioxide out of the atmosphere. The agency’s Loan Programs Office has also awarded more than $100 billion in loans and loan guarantees to mining companies, electric vehicle makers and other companies trying to bring nascent technologies to market.
But some of that funding has also started to be pulled back. This week, the Energy Department canceled a partial loan guarantee worth $2.92 billion to Sunnova Energy, a residential solar panel installer that was experimenting with a novel way to link home solar and battery systems.
In that case, the loan cancellation came after Sunnova said that it didn’t intend to use the funds “for the foreseeable future.” Sunnova’s business had been running into trouble even before the Trump administration came into office, partly because of high interest rates and reduced state incentives.
Brad Plumer is a Times reporter who covers technology and policy efforts to address global warming.
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