Navigating Federal Policy Shifts: A Guide for Nonprofits and Public Institutions

Since the presidential transition that took place on January 20, 2025, organizations across sectors—including those in the nonprofit and public space—have been adjusting to a shifting policy environment. Recent executive actions — including a freeze on Inflation Reduction Act (IRA) and Bipartisan Infrastructure Law (BIL) funding and new tariffs on Canadian and Chinese imports — have introduced new and uncertain dynamics which are already impacting project timelines, budgets, and investment decisions.

While long-term implications are still evolving, nonprofits and public institutions should be aware of potential risks to energy affordability and sustainability efforts, and what they can do to stay on track amid ongoing shifts.

Understanding Recent Federal Actions

Executive Orders, Funding Pauses, and Tariffs

Since taking Office this year, the Trump Administration has signed 157 Executive Orders. An executive order (EO) is a directive from the President that manages how the federal government operates. Two executive orders that have had the greatest impact on New England’s energy sector thus far include:

• EO 14154: Unleashing American Energy
• EO 14193: Imposing Duties To Address the Flow of Illicit Drugs Across Our Northern Border.

Among the more impactful developments is Executive Order 14154: “Unleashing American Energy,” issued on March 4, 2025. Under the section titled “Terminating the Green New Deal,” the order directs federal agencies to suspend all grants, loans, contracts, and other financial disbursements associated with the Inflation Reduction Act (IRA) and the Bipartisan Infrastructure Law (BIL)—two major pieces of legislation that have supported clean energy projects nationwide. This suspension will remain in effect while federal agencies and the Office of Management and Budget (OMB) conduct a 90-day review of the processes, policies, and programs governing the distribution of these funds, ensuring they align with the administrations’ energy policy priorities. The review period is critical in determining whether the funding pause is a temporary measure, or a signal of more substantial policy shifts. Although this review is still in progress, questions remain about whether already-obligated funds are impacted — such as the 84% of grants allocated under the IRA (approximately $96.7 billion). For nonprofits and public entities that have been planning solar, battery storage, EV infrastructure, or building electrification projects (including heat pumps), this uncertainty could introduce delays or force difficult decisions about project timing and budgeting. Even if funding is restored, private investors may be reluctant to engage with programs facing potential political or legal uncertainty.

If funding resumes, private investors still may be hesitant to partner with programs that could be subject to further political and legal challenges in the future. For many nonprofits and public entities dependent on these funds, the uncertainty has already led to difficult decisions, such as laying off staff or abandoning projects altogether given their limited resources to endure lengthy legal battles.

Tariffs on Canadian and Chinese Imports

On March 7, 2025, the Trump Administration officially imposed a 10% tariff on all Canadian imports into the United States in a separate executive action—EO 14193: “Imposing Duties To Address the Flow of Illicit Drugs Across Our Northern Border.” While the final scope of items affected can only be confirmed once the policy has been implemented, energy products could be impacted. This is of particular importance to the New England region, which relies on Canadian energy imports, particularly during the winter months.

According to ISO-NE, the region’s independent electric grid operator, natural gas continues to be the primary driver of electricity prices in the region, with costs heavily influenced by geopolitical dynamics and weather-related factors. While ISO-NE believes the tariffs likely do not apply to electricity, some uncertainty remains. ISO-NE currently has no system in place to collect or send tariff payments but will only seek further clarification if it receives an invoice from the federal government. Despite these uncertainties, ISO-NE is working on a plan to ensure compliance if necessary.

Although U.S. tariff policy has evolved over the course of the Trump Administration’s current term, tariffs have been implemented on many of the U.S.’s trade partners, including China. On Monday, May 12, the United States and China agreed to a 90-day pause in the escalation of tariffs. As part of this agreement, U.S. tariffs on Chinese goods decreased to 30% from 145%, while China reduced tariffs on U.S. goods to 10% from 125%. PowerOptions’ energy market expert notes that one potential outcome of these trade negotiations could be the resumption of U.S. LNG exports to China, which may affect domestic natural gas demand and prices. PowerOptions is also monitoring potential downstream effects on battery manufacturing, solar project costs, and the electric vehicle and charging infrastructure supply chains.

The long-term market effects of these tariffs also remain uncertain, reflecting the inherent complexity and volatility of energy markets, shaped in part by geopolitical factors such as trade policy. If energy costs rise due to supply disruptions or increased costs of imported fuels, nonprofit and public-sector energy users may see higher electricity or heating bills — potentially around 5% greater than the current market price— which can affect operating budgets and energy affordability for community-serving institutions like housing authorities, schools, and health centers.

Congressional Action: H.R. 1 “One Big Beautiful Bill”

On May 22, 2025, the U.S. House of Representatives passed H.R. 1, titled the “One Big Beautiful Bill,” by a narrow 215–214 vote following last-minute amendments. The bill includes a variety of changes, including several that impact the Inflation Reduction Act (IRA). Key proposed changes to IRA tax credits include:

• Ends Clean Energy Tax Credits:
  Repeals Sections 45Y and 48E, which currently offer up to 30% off clean electricity project costs, including solar and geothermal. Projects that begin construction within 60 days of the bill’s passage can still qualify, as long as they’re operational by December 31, 2028.
  
• Ends EV & Charging Incentives:
  Repeals Sections 45W, 30C, and 30D—ending tax credits for electric vehicles and charging equipment purchased after December 31, 2025.
  
• Ends Tax Credit Transferability (Starting 2028):
  Eliminates the ability to transfer clean energy and EV tax credits (Sections 45Y, 48E, and 30D) to other parties.
  
• Adds New EV Fee:
  Introduces a $250 annual registration fee for all electric vehicles and a $100 annual registration fee for all hybrid vehicles. This excludes commercial motor vehicles.
  
• Cuts Funding from Climate Programs:
  Rescinds unobligated funds from the following:
  • Greenhouse Gas Reduction Fund (including funding for state’s Solar for All programs)
  • EPA Clean Heavy Duty Vehicles Grant Program (e.g., incentives for electric school buses)
  • Climate Pollution Reduction Grants (CPRG) (clean energy funding for states, tribes, and nonprofits)
  • Diesel Emissions Reduction Act (DERA) (incentives for zero-emissions heavy-duty vehicles, including school buses)
  • EPA Low Emissions Electricity Technical Assistance Program (support for EV charging and zero-emissions school bus planning)
• New Restrictions on Foreign Involvement:
  Starting December 31, 2025, any clean energy or EV project receiving any material support from certain foreign entities (e.g., China) would be disqualified from tax credits and rebates.

The bill now moves to the Senate, where further amendments are expected. PowerOptions is actively evaluating the bill’s implications as it advances through the legislative process.

Implications for Clean Energy Projects

Solar and Battery Storage

Programs funded under the IRA and BIL have offered incentives and grants that reduce the up-front cost of solar and storage installations for nonprofits and public entities — including direct pay and tax credits, discounting these projects by at least 30%. A prolonged freeze of these funds could delay or cancel projects already in development or make new installations less financially viable.

While manufacturers and developers continue to seek clarity on the implications of tariffs on goods imported from China, current projections suggest that the duties could increase production costs for U.S.-based battery manufacturing. This is due to higher prices on key components such as battery cells, as well as general-purpose materials like steel and aluminum. As a result, these cost increases may ultimately affect the overall economics of energy projects and be passed on to consumers.

Electric Vehicles and EV Charging Infrastructure

Access to EVs and charging stations has grown under recent funding initiatives, which often cover infrastructure costs or vehicle subsidies for municipal fleets, schools, and community-based nonprofits. A pause or end in funding could stall fleet transitions and limit access to clean transportation in underserved areas. The Trump Administration has also announced the imposition of additional tariffs on the automotive industry, including cars, car parts, steel, and aluminum, anticipating additional costs to automobile supply chains. These tariffs also impact broader segments of the energy industry—for example, transformer prices have risen by 20%, influencing both EV charging infrastructure and the electric grid. Ongoing changes in tariff policy contribute to uncertainty about their overall effects, with no clear evidence that EVs will be disproportionately impacted.

Building Electrification and Heat Pumps

IRA-funded rebates and grants have also supported the electrification of buildings, including the installation of high-efficiency heat pumps in public and nonprofit buildings such as schools, community centers, and multifamily affordable housing. Without clarity on whether these programs will resume at full capacity, organizations may need to postpone or scale back planned upgrades, potentially missing out on long-term energy savings and emissions reductions.

Legal and Legislative Context

Legal challenges to the funding pause are ongoing. Several state attorneys general and nonprofit coalitions have filed suits seeking to reinstate funding, and at least one federal judge has ruled for obligated funds to be unfrozen. The EPA has since appealed this court ruling, pausing funding once again.

Legal challenges to certain tariffs have also emerged in federal courts. On Wednesday, May 28, 2025, a federal court in New York issued a ruling that blocked portions of tariffs imposed by the Trump Administration under emergency powers. The ruling was appealed within 24 hours, delaying any suspension of the tariffs while legal proceedings continue. Some tariffs—such as those on steel, aluminum, and automotive products—have been upheld as constitutional and remain in place. Until legal proceedings are resolved or new legislation provides further guidance, the current policy landscape remains subject to change with more detailed implications to be determined.

Regional Climate Goals Continue to Drive Clean Energy Progress

Despite federal-level shifts, New England states remain committed to ambitious clean energy and climate targets, many of which are codified in state law. These commitments include:

Massachusetts

• Global Warming Solutions Act (2008): Targets a 10-25% reduction in greenhouse gas emissions by 2020 and at least 80% reduction by 2050 (from 1990 levels).
• Next-Generation Roadmap for Climate Policy Act (2021): Aims for a 33% reduction in greenhouse gas emission by 2025, 50% by 2030, and 75% by 2040 (from 1990 levels).

Rhode Island

• 2021 Act on Climate: Requires greenhouse gas emissions to be 45% below 1990 levels by 2030, 80% by 2040, and net-zero by 2050.

Connecticut

• Global Warming Solutions Act (2008): Mandates an 80% reduction in greenhouse gas emissions by 2050 (from 2001 levels).
• Climate Change Planning and Resiliency Act (2018): Requires a 45% reduction in greenhouse gas emissions by 2030 (from 2001 levels).

These state-level mandates continue to drive clean energy investment and regulatory direction, providing a degree of policy continuity for nonprofits and public entities working toward long-term sustainability goals.

Charting a Clear Path Forward

Despite uncertainty at the federal level, PowerOptions remains steadfast in our mission: helping nonprofits and public institutions reduce energy costs, lower carbon emissions, and navigate a complex energy landscape which includes our current rapidly changing policy environment. We are closely monitoring legal and regulatory developments and will continue providing timely updates through our Regulatory and Policy Summaries (RAPS), direct Member outreach, and personalized support.

We encourage Members to stay engaged with PowerOptions on their clean energy projects wherever possible for guidance. Whether you need help navigating funding uncertainties, adjusting project strategies, or coordinating with vendors, PowerOptions is here to assist.

For questions or support, contact Sophia Gosselin-Smoske, Regulatory & Policy Analyst.