The Good, the Bad and the Ugly: Energy Efficiency Implications of Bipartisan Action to Reopen Government
Let's Save Energy
Alliance to Save Energy's Blog
The Alliance to Save Energy welcomes the end of the federal government shutdown. Vital, bipartisan energy efficiency programs—including the Low-Income Home Energy Assistance Program (LIHEAP), Weatherization Assistance Program (WAP), State Energy Program (SEP), Rural Energy for America Program (REAP), and ENERGY STAR—can now resume, but not without lingering disruptions.
Federal Energy Efficiency Funding Resumes
With the passage of the stopgap funding bill, and the conclusion of the nation’s longest federal government shutdown, key agencies—including the U.S. Department of Energy (DOE), U.S. Department of Agriculture (USDA), and Environmental Protection Agency (EPA)—are resuming operations at least through January 30, 2026.
This officially restores federal funding for LIHEAP, WAP, SEP, and ENERGY STAR to pre-shutdown (Biden-era) levels, and funds REAP through September 2026. Staffing shortages will continue to hamper awards to States, including grants and loans to the State Energy Offices that implement many of the low-income efficiency programs.
We remain concerned that DOE and EPA actions to eliminate grants and programs previously funded through the Inflation Reduction Act (IRA) and bipartisan Infrastructure Investment and Jobs Act (IIJA) have chilled ongoing investments.
Prior to the shutdown, LIHEAP and WAP were challenged by staffing reductions. Only eight of the 56 Weatherization Assistance grants that are typically delivered by July 1 have been approved by the Administration and distributed by the DOE Office of Energy Efficiency and Renewable Energy’s (EERE) field office in Golden, Colo.
What Has—and Hasn’t—Changed
No Cuts in Stopgap Funding, Though Programs Still Under Threat: The agreement signed into law is a continuing resolution, meaning there are no new program cuts; WAP, SEP, and ENERGY STAR will each be funded at last year’s levels. However, because the funding is a continuing resolution, the Administration has more leeway to reorganize agencies.
Temporary Solution: This deal is not a full-year budget. Long-term funding stability remains at risk unless Congress acts by late January to pass full appropriations and keep these programs running at full strength.
Advocacy Still Needed: While the end of the shutdown is a relief, the future of ENERGY STAR remains at risk, with previous budget proposals suggesting its elimination beyond the short-term fix. The Alliance will urge Congressional Committees of jurisdiction to support ENERGY STAR.
Shutdown-Driven Disruption and Program Backlogs
Plan Approvals and Grants Delayed: The shutdown triggered immediate freezes for state LIHEAP, WAP and SEP grantees, with DOE and HHS staff furloughed and payment systems offline. Given limited progress before the shutdown, it seems unlikely the administration will make this funding available to states quickly,
Planning Uncertainty: The uncertainty created by the lapse in appropriations makes it more difficult for states and local partners to plan projects, retain staff, and sign contracts—undermining efficiency efforts at a time when energy savings are needed most.
Looking Forward: Bipartisan Support More Important Than Ever
Federal energy efficiency programs have long enjoyed bipartisan support because they deliver benefits for every fuel type, every region, and every American. With the government back open, the Alliance to Save Energy is urging Congress to act swiftly on a full-year budget that protects and grows cornerstone programs like WAP, SEP, and ENERGY STAR to continue driving lower energy bills, jobs, and affordability benefits.
With winter fast approaching and energy prices already rising, now is not the time to delay or threaten energy efficiency investments that help American families afford to pay their energy bills.
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