Trump Administration Thawing Frozen IRA Funding for Electric Co-ops?

This story by Allen Best appeared on BigPivots.com on March 28, 2025.

Electrical cooperatives in Colorado were informed before Joe Biden left the White House that they would be getting about $3.5 billion from the federal government via programs funded by the Inflation Reduction Act of 2022.

Will they? U.S. Secretary of Agriculture Brooke Rollins announced Tuesday that her department was releasing funds previously committed but also described a “course correction.” Just what constitutes a “course correction” will likely not become fully apparent for weeks, perhaps months.

The release said that electrical cooperatives must first revise their project plans to “remove harmful DEIA and far-left climate features.” DEIA stands for diversity, equity, inclusion and accessibility.

The announcement by the USDA — the department houses the Rural Utility Services, the agency that works with cooperatives — also said electrical cooperatives would be asked several questions and would need to provide a short narrative description of any proposed changes in their projects.

The revised projects must also align with an executive order issued by President Donald Trump on Jan. 20 called “Unleashing American Energy.” Just exactly what those revisions need to look like remains unclear. In that executive order Trump rescinded a long list of executive orders issued by former President Joe Biden, including 10 that had to do with climate change.

Trump’s order made no mention of renewable energy but did order agency heads to identify actions that “impose an undue burden on the identification, development, or use of domestic energy resources – with particular attention to oil, natural gas, coal, hydropower, biofuels, critical mineral, and nuclear energy resources…”

How do projects need to be revised?

“We are as interested to find out as you are,” replied Alex Shelley, who has the public information job at San Miguel Power Association, when I called him Wednesday afternoon. San Miguel expected to get a $9.8 million grant from the New ERA program to construct a 20-megawatt solar project in western Montrose County. That area of Montrose County includes Nucla, Naturita, and Uravan. Tri-State Generation and Transmission Association operated Nucla Station, a coal burning plant, until 2019.

In a statement posted on Jan. 23, Brad Zaporski, the chief executive of San Miguel Power, called the project a “shining example of partnership in action to help bolster our rural communities.”

The project, said Shelley, is to be on private land that is not useful for agriculture or anything other than light industry.

Brighton-based United Power was to get $262 million for six solar projects in its service territory in northern Colorado and one other project involving hydroelectricity. About 40% of the service territory is in Wattenberg Field, Colorado’s primary oil and gas producing area.

“I think the story is that the RUS wants to get the money moving to help rural communities,” said Mark Gabriel, the chief executive. “We were given the opportunity to make any edits or resubmit, and we chose not to (make changes to our application).”

The original application, he added, made no mention of diversity or inclusion. It asserted the desire to make United’s members more reliant on local resources and with lower-cost electricity.

Tri-State G&T has the most skin in this game. It provides wholesale electricity for 40 electric cooperatives in a four-state area, including 15 in Colorado. Tri-State in 2024 said it was getting a financial package worth $2.5 billion, most of that in loans of less than 2%. Those low-interest loans will allow it to get out from under higher-interest financing as it prepares to close its coal units in Colorado and Arizona during coming years.

In an October announcement, Tri-State said New ERA funding would support financing for 1,280 megawatts of energy from solar, wind and wind-storage projects, and more than 100 megawatts of stand-alone energy storage.

The company also plans a natural gas plant, preferably in northwest Colorado or conceivably southwest Wyoming.

Tri-State expects to reach 70% clean energy by 2030. Within Colorado, this will be an 89% reduction as compared to a 2005 baseline.

“We appreciate the work of Secretary Rollins and her team to advance the program, and we will be reviewing the USDA’s guidance and look forward to continuing our work through their process,” said Tri-State CEO Duane Highley in a statement posted on Wednesday.

In Fort Collins, Jeff Wadsworth was cautious about what the final tally will look like. He’s the chief executive of Poudre Valley REA, which is in line to get $9 million to help pay for two solar-and-storage projects. The grant was through Powering Affordable Clean Energy, or PACE, another program funded by the IRA.

“We are thrilled about this development and look forward to collaborating with the dedicated team at the USDA,” he said initially when asked for a response. In a telephone conversation the next day, however, he said that the full story remains to be written.

Wadsworth is optimistic that Poudre Valley will get its money. Demand for electricity has continued to grow for multiple reasons, and these projects will help Poudre Valley meet that demand. But this grant is not the end-all, be-all for Poudre Valley as it moves forward, he said.

“It helps our ratepayers, who are part of rural Colorado, We are excited about that,” said Wadsworth. “But our path is pretty clear as we move forward.”

Still another perspective comes from Eric Frankowski, the executive director of the Western Clean Energy Campaign. He believes that despite the “problematic” language of the announcement, the guidance that RUS has issued for the cooperatives has eased a lot of concerns.

“It appears that the process is completely voluntary and that co-ops do not need to do anything. The language says that RUS will NOT approve proposed modifications ‘that affect the scoring of projects that were competitively scored.’ Since community benefits, decarbonization and lowering rates were all integral to how proposals were evaluated, I think we can take that as a good sign,” he wrote in an e-mail.

That guidance can be found here.

“The guidance also says that if awardees do not respond within 30 days requesting a revision, ‘it will be considered that they do not wish to make changes to their proposals, and disbursements and other actions will resume after the 30 days.’ (emphasis added) It also says that awardees can respond that they are not changing their proposal and processing of payments will begin immediately. Also good signs,” said Frankowski.

“There doesn’t seem to be a pathway where co-ops are punished for staying the course on their clean energy plans,” he added. “Who knows what happens after the 30-day window, but things seem good for now.”

Granby-based Mountain Parks Electric in January announced that it had executed a letter of commitment with the U.S. Department of Agriculture for a grant prog ram of $100 million across the next 20 years. The announcement said that the money will be used to help procure power through power-purchase agreements and to advance and promote scholarships and apprenticeship programs. The announcement was made two weeks before Mountain Parks left Tri-State and began getting its wholesale power from Guzman Energy in a 20-year agreement.

Sedalia-based CORE Electric Cooperative hopes for $225 million and Steamboat Springs-based Yampa Valley Electric $50 million. Grand Junction-based Grand Valley Power Lines also expected to get federal funds.

In his statement, Highley credited the work of U.S. Representatives Jeff Hurd, Gabe Evans, Lauren Boebert, all from Colorado, and Gabe Vasquez, of New Mexico, as well as Colorado Senators John Hickenlooper and Michael Bennet. Bennet, in particular, had gone to bat for the New ERA provision for cooperatives in the IRA. He spoke in October at Tri-State’s headquarters when a finalized announcement was made.