Solar for All Program Gets New Life. What's Next for $7B in Restored Grants?

A federal judge has ruled that the Trump administration broke the law when it canceled a $7 billion program that was supposed to bring solar power to more than 900,000 lower-income households across the country. Here’s what happened, and what it means for the families who were counting on that help to lower their energy bills.

What is Solar for All?

Back in 2022, Congress passed a big climate law under President Biden. One part of that law created a $7 billion program called Solar for All. The idea was simple: help people who couldn’t normally afford solar panels get access to them anyway.

The federal government didn’t hand this money out to individual families directly. Instead, it gave grants to states, Native American tribes, nonprofits, and local organizations. Those groups were supposed to use the money to install solar panels on homes and apartment buildings, run community solar projects, and lower people’s electric bills. By 2024, every state and dozens of organizations had been awarded their piece of the $7 billion.

To be clear, Solar for All is separate from the now-terminated federal solar tax credit that homeowners used to claim on their federal tax returns after installing solar and/or battery storage. The decision that ended this “25D” tax credit remains in place.

Why did the EPA try to cancel it?

In July 2025, Congress passed a different law under President Trump, a huge tax and spending package often called the “One Big Beautiful Bill Act.” That law canceled money from a bigger climate fund that Solar for All was part of, but only the part of the money that hadn’t been formally handed out yet, called “unobligated” funds.

The next month, in August 2025, the head of the EPA, Lee Zeldin, went further. He announced the agency was ending Solar for All entirely, not just the leftover money, but the grants that had already been promised and signed. He called the program a “boondoggle,” meaning wasteful.

That decision hit hard. States and organizations had already spent months planning solar projects, hiring staff, and telling communities help was coming. Some had that support suddenly cut off.

What did the judge decide?

A group of organizations, including the Rhode Island AFL-CIO labor union and a nonprofit called Solar United Neighbors, sued the EPA over the cancellation. Their case landed in front of U.S. District Judge Mary McElroy in Rhode Island, notably, a judge appointed by Trump himself.

On September 18, 2026, McElroy ruled in their favor. Her reasoning was pretty straightforward: the 2025 law only took back money that hadn’t been promised to anyone yet. It never gave the EPA permission to cancel grants that had already been awarded and locked in with a signed agreement. Since the EPA didn’t have any other legal basis for canceling those grants, either, the whole termination was illegal.

She didn’t just say the EPA was wrong, she legally wiped out the cancellation, a step called “vacating” it. That means, as far as the law is concerned, it’s like the EPA’s cancellation never happened. The agency is now required to go back to running the program the way Congress originally set it up.

So does the money show up now?

For grants that were already signed and committed, which is the vast majority of the $7 billion, the ruling means the EPA has to start administering and paying out those grants again. That covers things like Arizona’s $156 million solar program and a $25 million grant for the Hopi Tribe.

It’s worth knowing that when the EPA canceled the program last year, it didn’t just stop future payments, it also clawed back a lot of money that states and groups had already been sent. Since the judge threw out the entire cancellation, the legal basis for taking that money back is gone too, which should mean it’s owed back to grantees. Some organizations weren’t willing to wait around for this case to finish, though, and they filed a separate lawsuit in a different court seeking the value of their grants directly.

Is this really over?

Not necessarily. An EPA spokesperson said the agency is reviewing the ruling and “considering options for appeal.” That means the Trump administration could ask a higher court to overturn this decision. Until that plays out, there’s some uncertainty about exactly when, or how smoothly, the money will actually start flowing to the families and communities who were promised it.

For now, though, the ruling is a significant win for the states, tribes, and nonprofits that had been left in limbo, and it sends a clear signal that the government can’t simply walk away from federal grants once they’ve been legally promised.