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AG Nessel Successfully Protects State Energy Programs
April 02, 2026
LANSING – Michigan Attorney General Dana Nessel today released the following statement after the U.S. Department of Energy (DOE) rescinded its unlawful policy capping reimbursement for state energy programs and agreed to dismiss its appeal (PDF), preserving States’ victory in federal court and bringing the case to a close:
“While I am relieved the Trump administration finally abandoned its illegal policy of limiting resources for critical energy programs, it is just one example in what is becoming a long list of unlawful actions where the federal government is trying to scrap negotiated agreements and shortchange states,” said Attorney General Nessel. “We have been overwhelmingly successful in stopping these efforts, and we will continue to fight back against attempts to jeopardize programs residents rely on.”
In August 2025, Attorney General Nessel and a coalition of states sued DOE over a new policy capping reimbursement for key administrative and staffing costs at ten percent of a project’s total budget, threatening millions of dollars in funding for state energy programs. In September 2025, the U.S. District Court for the District of Oregon ruled in favor of the states and struck down DOE’s “indirect costs” policy.
After initially appealing that decision, DOE has now rescinded the policy and agreed to dismiss its appeal, ensuring that states will continue to receive full federal funding for these essential programs and bringing the litigation to a successful conclusion.
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