The Department of Energy is moving at a fast clip and making major changes under Secretary Chris Wright as the first year of President Donald Trump’s second term wraps up.
Thousands of staffing positions have been cut. Over $11 billion in grants has been canceled. Decades-old energy efficiency regulations have been dismantled. DOE has issued emergency orders to keep coal plants from retiring, part of its focus on fossil fuels. And it’s pushing to expand the data center boom.
“It’s been a massive swing,” said Tom Pyle, president of the fossil-fuel-supporting, free-market group American Energy Alliance.
In a heavily divided nation, the Trump agenda at DOE is triggering applause from conservatives and fossil fuel supporters and consternation among environmentalists. Climate activists and public health advocates say the DOE under Wright is advancing policies that raise energy prices and expose Americans to harmful pollution tied to fossil fuel emissions.
“Chris Wright has fully embraced Donald Trump’s war on renewables, and that’s extremely significant,” said Tyson Slocum, director of Public Citizen’s energy program. “Almost on a weekly basis, Secretary Wright posts social media content from his official government accounts spreading complete misinformation and lies about renewable energy and particularly about solar.”
Wright himself is a major change-maker in the federal government and energy world. As a former CEO of fracking services company Liberty Energy, Wright is steeped in data on energy systems and a frequent guest on media outlets like Fox News. At an event last week, Trump called Wright the “greatest oil man anywhere in the world.”
Despite some apparent rifts with the White House of late, including the firing of a top DOE official closely tied to Trump world, conservatives are fully behind Wright.
“Secretary Wright is just a really, really knowledgeable person. He’s extremely well qualified for this job,” said Pyle.
Heading into the next year, many questions remain about how the Trump administration intends to execute its energy policy: What specific loans will be offered to energy companies? How many more billions of dollars might be cut from Biden-era projects?
All of these questions come as electricity demand is projected to increase dramatically, along with utility bills for everyday Americans.
DOE did not respond to requests for comment.
Are the changes durable?
Some of the changes at DOE under Wright are likely to have a short shelf life if a new Democratic administration takes power, including the renaming and shuffling of offices. Other changes could have more staying power.
Critics of the administration say the layoffs and grant cuts, more of which could be in the offing over the coming months, will cause companies and American workers to think twice about teaming up with the federal government in the future.
“I had convinced a bunch of people to go into the department, who then all got fired and now say they would never go back to work for the federal government. So that, I think, is a huge loss,” said Kate Gordon, CEO of the non-profit California Forward and a former adviser to Secretary Jennifer Granholm under Biden. “It might be generational. We worked incredibly hard in the administration to try to make it exciting for people to go into government. It’s hard to do.”
Staffing cuts will also have “long-term consequences” because of the large amounts of money the department is tasked with moving out the door, said Alex Kizer, an executive vice president at the EFI Foundation and a former DOE staffer during the Obama administration.
It’s unclear if DOE will aim to address the staffing crunch with contractors or new hires with specific skill sets, he said.
The administration’s push to add dramatically more power to the electricity grid could also have staying power.
“Now everyone is talking about the need for more energy for AI and to stay ahead of China,” said Diana Furchtgott-Roth, director of the Center for Energy, Climate and Environment at the Heritage Foundation. “I think that that is going to stick with people because that seems to be nonpartisan. Everyone wants us to have the best AI and data centers. Both parties want us to stay ahead of China in that.”
Reorganization and funding cuts
A reorganization last month at DOE moved the decades-old Office of Energy Efficiency and Renewable Energy to a new Office of Critical Minerals and Energy Innovation. It also cut the Office of Clean Energy Demonstrations, which was created by Congress in the 2021 bipartisan infrastructure law, and renamed the Loan Programs Office the Office of Energy Dominance Financing.
Gordon said the cut to OCED and grant cancellations, most of which stem from the infrastructure law, flout U.S. laws.
“We organized partly around deployment, which is something that the agency didn’t do. Trump just got rid of that [OCED], which I don’t think is allowed because it was created in a bill by Congress. But what does ‘it’s not allowed’ mean anymore?” she said. “What we’re seeing now is just a complete separation of the executive from the will of Congress and that is a very strange and disturbing thing to see.”
Some changes could be reversed easily in the future, considering that Biden and the first Trump administration also reorganized offices.
But the One Big Beautiful Bill Act, a megalaw signed by Trump in July, rescinded the “unobligated balances” of Inflation Reduction Act funding for the OCED, along with other programs at DOE. The administration’s supporters say that paved the way for DOE to retool priorities.
“I don’t think the department should be in the business of deployment. It should be in the business of research and development,” said Pyle, referencing DOE’s historic R&D role in energy development.
Jessie Stolark, executive director at the Carbon Capture Coalition, said from the group’s understanding, “under the recent DOE reorganization, unspent OCED funds are being reprogrammed to other offices within the department.”
Claire Cody, an analyst at Clean Tomorrow who worked at DOE earlier this year, said parts of OCED will likely be split up, although the office was authorized as a distinct entity. “We’ll have to see what Congress does about that,” she said.
Typically, deobligated funds are returned to the Treasury if they are not being challenged by affected companies, but there are restrictions on how they can be reused. For example, DOE is supposed to only reobligate funds that are still within their appropriation window and that are tapped for their original statutory purpose directed by Congress.
Kizer said he suspected that billions of dollars of funding could be reprogrammed by the Trump administration, but it is a “big area of uncertainty.”
Efficiency no more
DOE is proposing to roll back dozens of regulations, including a laundry list of appliance efficiency rules, which force manufacturers to sell products that use less energy. Lawsuits on the efficiency rollbacks are expected once DOE issues finalized rules.
The Trump administration also proposed cutting the Weatherization Assistance Program, a 50-year-old initiative that subsidizes equipment efficiency upgrades for low-income households, while EPA is waffling on whether to continue Energy Star, a program that certifies efficient household equipment and buildings.
Meanwhile, the OBBB cut tax credits for homeowner efficiency upgrades. Efficiency advocates say the rules help to meet load growth and reduce Americans exposure to pollutants.
“These rollbacks would just increase bills for families and businesses and add extra strain on the electric grid,” said Andrew deLaski, executive director of the Appliance Standards Awareness Project. “The only folks who might benefit are companies making and selling super-inefficient products overseas who could send them here.”
Furchtgott-Roth and other conservatives say the efficiency rules deprive Americans of market choice.
“We’ve moved from an energy scarcity era in the Biden administration to an energy abundance era in the Trump administration,” she said. “There’s no need for the government to set rules for efficiency.”
Efficiency advocates say the federal rollbacks put the onus on the states. But states like Arizona are also nixing efficiency funding.
A new report from the Competitive Enterprise Institute, a conservative think tank, said the efficiency rules are “raising prices, limiting product choice, and undermining performance, reliability, and longevity.”
More fossil fuels and nuclear
Supporters of Wright and Trump also say the embrace of fossil fuels increases U.S. energy security and stature globally as an energy exporter.
“By taking the steps President Trump is, he’s detaching us from China. He’s making us independent,” said Furchtgott-Roth. “If we were to have gone the Biden route, we would have been dependent on these renewables and batteries.”
While environmentalists are critical of the administration’s dismantling of climate policy, some note that DOE is not going full steam ahead on liquefied natural gas exports.
“The Department of Energy has actually been proceeding much more cautiously because I think industry advised them that they need to,” said Slocum. “If you approve an LNG application in a hasty or sloppy manner, it could be undone by courts and things could get tied up for a long time.”
Slocum said a recent approval of the CP2 LNG export project “was very careful and really went through the protesters’ arguments in pretty significant detail.”
The Trump administration, meanwhile, has pushed aggressively for more LNG commitments in U.S. trade deals. But the trade deals announced this year are not the traditional pacts approved by Congress with the force of law.
“The trade and tariff associated LNG push that Secretary Wright has been intimately involved in … when you start to put a microscope on it, it’s a big nothing burger so far,” said Slocum.
Even still, the proposed Alaska LNG project — despite the Trump administration’s zealous support for it — has yet to reach a final investment decision on the project’s 807-mile natural gas pipeline. Trump officials have touted several nonbinding agreements for the project.
On the homefront, Wright has used emergency authorities to force utilities to operate fossil fuel plants in Michigan, Pennsylvania and Washington. And new policies to boost fossil fuels keep rolling in. In early December, for instance, Wright teased new rules to use fossil-fuel-based backup generators to meet demand growth.
Meanwhile, nuclear energy is a major priority for the administration. The White House has pledged to quadruple nuclear energy in the United States by 2050 and is pushing the Federal Energy Regulatory Commission to expedite license approvals.
DOE is poised to fund new uranium enrichment projects in the U.S., with a deadline approaching on a cutoff for Russian imports that are vital to the U.S. nuclear sector. But so far, utilities are moving sluggishly — if at all — to contract to build new nuclear plants.
AI, renewables and clean tech
A central question lingering over DOE in the coming months is what will happen to emerging technologies that could either advance or stall depending on federal funding. DOE has played a significant role in the past in commercializing technologies such as utility-scale solar through its loan office and other grants.
“We haven’t seen the most aggressive RFIs and requests for proposals … compared to how much funding they have available. Will there be new areas that emerge?” Kizer asked.
He said he is also watching closely how DOE taps nonmonetary tools to advance technologies, citing the department’s move in October to take a 5 percent stake in Lithium Americas.
Wright has framed much of DOE’s strategy around the push for AI, including plans to build data centers on federal land and implement the “Genesis Mission” on supercomputing.
One technology with a murky future is “clean” hydrogen, which was a focus of the Biden administration and backed by $8 billion under the infrastructure law. DOE has since moved to cancel two hydrogen hubs on the West Coast tied to producing fuel with renewables, but the fate of six other hubs — and billions of dollars from the law — remains up in the air.
What DOE decides will be particularly important for “blue” hydrogen produced with natural gas tied to carbon capture. According to analysts, that form of hydrogen is likely to be the focus in the U.S. partly because of rollbacks in federal support for renewables that would bolster “green” hydrogen.
But blue hydrogen has shown signs of struggling, underscoring the importance of the infrastructure law funding for the industry. Last month, Exxon Mobil said it was pausing plans for a major blue hydrogen project in Baytown, Texas, because of weak customer demand.
Environmentalists also have been raising concerns that administration changes to DOE models could allow hydrogen companies receiving federal tax credits to release more methane emissions with projects than previously envisioned.
With other emerging technologies, like fusion, funding is also a critical issue. Wright has been pushing for fusion — which envisions power plants using the same reaction powering the sun — and the recent DOE reorganization created a new office for the industry. The move will help gear the department more toward commercialization of projects, but details are being sorted out, said Andrew Holland, CEO of the Fusion Industry Association.
The new office shows the “administration takes seriously the goal and challenges of getting fusion energy commercialized,” said Holland, who met with Dario Gil, DOE’s undersecretary for science, this month.
But “there’s a reality that we’re in a budget-constrained environment,” he said in an interview. The fusion office currently is funded at around $800 million, and the industry is pushing for funding closer to $1 billion annually.
“We’re confident if the administration asked for it, Congress would support them,” Holland said.
