Attorney General James Secures Final Victory Protecting State Energy Programs

April 2, 2026

NEW YORK - New York Attorney General Letitia James today released the following statement after the U.S. Department of Energy (DOE) rescinded its unlawful policy capping reimbursement for state energy programs and agreed to dismiss its appeal, preserving states' victory in federal court and bringing the case to a close:

"Despite skyrocketing energy costs nationwide, last year the federal government tried to slash funding for vital state-run energy programs. We went to court and won, but the administration still tried to fight us. That ends today.

"By withdrawing its policy and dropping its appeal, the federal government is finally acknowledging what the court already made clear: it cannot ignore the law to cut funding that Congress has already approved.

"This is a major victory for families in New York and across the country who rely on these programs to lower their bills, strengthen infrastructure, and prepare for extreme weather."

In August 2025, Attorney General James led a coalition in suing DOE over a new policy capping reimbursement for key administrative and staffing costs at ten percent of a project's total budget, threatening millions of dollars in funding for state energy programs. In September 2025, the U.S. District Court for the District of Oregon ruled in favor of the states and struck down DOE's "indirect costs" policy.

After initially appealing that decision, DOE has now rescinded the policy and agreed to dismiss its appeal, ensuring that states will continue to receive full federal funding for these essential programs and bringing the litigation to a successful conclusion.