The US Department of Energy (DOE) has revoked $3.7 billion in previously announced funding for carbon capture and clean energy demonstration projects, impacting several major energy companies including Calpine, Ørsted, Exxon Mobil, and PPL Corp.
Among the rescinded funds was $540 million allocated to Calpine for carbon capture and storage (CCS) initiatives at two of its natural gas power facilities — the 550-megawatt Sutter plant in Yuba City, California, and the 810-megawatt Baytown facility in Texas.
The decision, announced Friday, affects a broad slate of carbon capture and decarbonization ventures. DOE noted that 16 of the 24 canceled awards were originally approved during the transition period between the 2024 US presidential election and Inauguration Day in January 2025.
This move is part of a larger internal review by DOE, which is currently reassessing 179 projects with a total funding value exceeding $15 billion. The agency said the review follows newly outlined evaluation procedures introduced earlier this month.
“While the previous administration failed to conduct a thorough financial review before signing away billions of taxpayer dollars, the Trump administration is doing our due diligence to ensure we are utilizing taxpayer dollars to strengthen our national security, bolster affordable, reliable energy sources and advance projects that generate the highest possible return on investment,” said US Secretary of Energy Chris Wright.
“Today, we are acting in the best interest of the American people by cancelling these 24 awards.”
The move has already provoked negative reactions from different industry players, including Jessie Stolark, executive director of the Carbon Capture Coalition, who described it as “a major step backward in the nationwide deployment of carbon management technologies.”
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“Further development and deployment of carbon management technologies is crucial to meeting America’s growing demand for affordable, reliable, and sustainable energy,” Stolark said in a statement.
The present uncertainty surrounding carbon management projects has, in part, led to a sharp decline in new Class VI applications.
According to Enverus Intelligence Research (EIR), a subsidiary of energy-focused SaaS company Enverus, the number of Class VI well applications has dropped by 55% in the first quarter of 2025, compared to the quarterly average in the last two years.
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