TUCSON, Ariz. (KGUN) — Funding freezes on federal green energy grants, announced in mid-February, are starting to take a toll on Southern Arizona.
Community leaders and nonprofit organizations are voicing growing concern over the halted projects that were designed to boost energy efficiency, reduce pollution and support job creation in the region.
On Wednesday, April 30, city officials and nonprofit representatives held a press conference in midtown Tucson to address the impacts of the stalled funds.
“Grants and the investments that are being clawed back at the federal level are going to have a real impact in the community and in particular, on climate, public health and the economy,” said Karin Uhlich, who represents Ward 6 in the Tucson City Council.
One of the most significant casualties of the freeze is a $20 million Environmental Protection Agency (EPA) grant to the Primavera Foundation, which aimed to provide solar energy solutions and shade infrastructure for affordable housing projects, among other initiatives.
Uhlich emphasized that projects like these don’t just improve environmental outcomes but also enhance public health and provide economic relief to homeowners, small businesses and nonprofits.
Dre Thompson, President of Groundswell Capital, detailed how the funding freeze has derailed hundreds of initiatives aimed at reducing pollution and increasing energy efficiency.
“Groundswell is the least important of what’s impacted,” Thompson said. “It’s really about all these small businesses, all these housing developments and projects, small towns in rural Arizona that were relying on this capital to move projects forward and now it’s unclear what the future is going to be.”
Thompson focused on one project in particular that was halted by the grant freeze, which partnered with housing developments to serve as a financial bridge to afford green energy infrastructure, such as solar panels on new developments.
According to Thompson, these energy improvements are often “valued out” of developments when costs rise, so the program aimed to be a safety net, enabling homeowners to reduce their costs to stay in that home.”
However, following the freeze, the project’s future is uncertain.
“This was going to be the final piece of the puzzle to ensure that we could lock in these energy savings,” Thompson said. “Now, those projects will either need to find alternative capital or forego those investments altogether.”
Thompson retains hope that the freeze will be resolved as the issue winds itself through the courts.
“The EPA has been asked for evidence why these contracts shouldn’t move forward that were legally implemented and haven’t provided any evidence that this holds legal standing,” Thompson. “The opportunity has been there for the administration to lay out a case of why these legal contracts shouldn’t move forward that were voted for in a bipartisan way.”
She says most Americans agree on the program’s goals, even if they may not realize it.
“All of us want to see a reshoring of American jobs and manufacturing. We want to see energy independence and good-paying jobs,” Thompson said. “What makes me hopeful is that we’re trying to get the same stuff done. As we start to bear out the evidence of what these dollars will do for our communities, I think we can come to the table and find a solution benefiting Arizona.”
The agricultural industry, already strained by water scarcity in the Southwest, is another sector hit hard by the halted grants.
Kimber Lanning, CEO of Local First Arizona, pointed out that several planned research and development projects—especially those aimed at cultivating water-efficient crops—have been delayed indefinitely.
Lanning says the freezes have left small businesses holding the bag due to past contracts. She says many small businesses were promised partial reimbursement by the federal government for investing in rooftop solar and other green energy investments.
“A lot of them spent that money and a lot of them have been told they are not being reimbursed,” Lanning said. “There’s the immediate crisis of potentially not being able to finish the project and the secondary crisis of having a massive hole in their budget.
Lanning says recent reductions in the federal workforce are adding to the problem.
“There’s been some inconsistent messaging,” she said. “But with such a huge reduction in the workforce, it’s difficult to reach anyone in the government now.”
She mentions Hillsdale Farms of Yuma, which received an email from the federal government urging the farm to move forward on a solar project.
However, she says the farm has not been able to contact a government representative, leaving the project’s fate in question. “There’s a lack of clarity and a whole lot of waiting,” Lanning said.
City leaders are now turning their attention to Arizona’s congressional delegation, urging them to help resolve the issue and restore the vital funding.
“We want our congressional delegation to work with us,” said Uhlich, “so that if federal cuts are contemplated, they’re handled in a manner that does not undermine the tremendous progress and promise that these investments hold for Tucson.”
Despite the setbacks, Uhlich expressed optimism, noting that Arizona lawmakers have shown a willingness to support the affected programs.
Speaking at the conference, she singled out Representative Juan Ciscomani as taking part in maintaining tax credits for solar energy, a program begun under the Inflation Reduction Act (IRA).
Uhlich acknowledges that the federal government will likely invest less funding in green energy projects, but hopes any cuts are made in a thoughtful, methodical manner.
“We want our congressional delegation to work with us so that if federal cuts are contemplated, they’re handled in a manner that does not undermine the tremendous progress and promise that these investments hold for Tucson,” Uhlich said.
She says both democrats and republicans in Congress understand the importance of investments in a green energy future.
“These are investments that in the long run can substantially benefit communities and, quite frankly, take pressure off the federal budget,” Uhlich said. “If fewer families are insecure, either energy-wise or economically, that takes pressure off all levels of government and allows a community to prosper.”
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