A second federal court ruling has increased the possibility that billions of dollars in stalled residential solar projects could eventually move forward again.
On September 22, the U.S. District Court for the District of Columbia ruled against the Environmental Protection Agency’s decision to terminate the $7 billion Solar for All program, siding with Harris County, Texas, a program grant recipient.
The decision comes just days after a federal judge in Rhode Island separately ruled against EPA’s termination of the same program.
For solar companies, contractors, state and local governments, and organizations preparing projects around the country, the rulings potentially change the outlook for money that had effectively been frozen.
But they do not mean $7 billion will immediately begin flowing again.
The more accurate conclusion is:
Projects that appeared dead after EPA terminated the program now have a potentially viable path back—but significant legal and administrative uncertainty remains.
What Was Solar for All?
Solar for All was created as part of the Greenhouse Gas Reduction Fund established by the Inflation Reduction Act.
EPA ultimately selected 60 recipients for $7 billion in awards, including states, territories, Tribal governments, municipalities, and nonprofit organizations.
The program was designed to expand residential and community solar access in lower-income communities through grants, financing and technical assistance.
EPA said when it announced the awards in 2024 that the program was expected to support solar access for more than 900,000 households nationwide.
The agency also estimated that the projects could generate more than $350 million in annual household electricity savings.
The previous administration made those projections, and they depended on the program being implemented.
That assumption changed dramatically in 2025.
EPA Terminated the Program
In August 2025, EPA announced that it would no longer implement Solar for All.
The agency argued that subsequent legislation repealed its authority to administer the program and rescinded remaining funds.
That decision created immediate problems for grant recipients that had already spent months developing programs, hiring employees, planning procurements, and establishing relationships with contractors and communities.
Some projects stopped.
Procurement opportunities were paused.
Organizations expecting federal funding suddenly faced uncertainty about whether that money would ever arrive.
The dispute then moved into federal court.
Two Federal Judges Have Now Rejected the Termination
The first major ruling came September 18 from a federal court in Rhode Island.
The second came September 22 in Washington, D.C., in a case brought by Harris County.
The D.C. court concluded that Congress’s subsequent legislation rescinded unobligated funds but did not give EPA authority to terminate funds already obligated to Solar for All recipients.
That distinction is central to the dispute.
EPA had obligated the $7 billion to the program’s recipients before Congress changed the underlying law.
The court therefore rejected EPA’s conclusion that continuing the program was legally prohibited and vacated the agency’s program-wide termination decision.
Two courts reaching similar conclusions within days materially strengthens the position of grant recipients challenging the termination.
But businesses should still interpret the rulings carefully.
This Does Not Mean Every Project Restarts Tomorrow
The court decision removes a major legal obstacle.
It doesn’t instantly resolve every operational question.
EPA can appeal.
Individual grant agreements and payment disputes can involve additional legal and administrative issues.
And organizations that stopped projects after the termination may need time to restart procurement, staffing, and contracting processes.
The D.C. court also did not simply issue an order requiring the government to immediately transfer every remaining dollar to every recipient.
That means companies should not treat the ruling as equivalent to cash arriving in a bank account.
The practical effects will become clearer as EPA determines its next legal steps and grant recipients determine how quickly their programs can resume.
Billions in Business Activity Are Potentially Affected
This is where the story becomes important beyond Washington.
The original program wasn’t simply transferring money to government agencies.
Recipients were expected to use the funding to build programs that ultimately required private-sector participation.
Solar installers.
Electrical contractors.
Equipment suppliers.
Engineering companies.
Financing providers.
Workforce-training organizations.
Software companies.
Community organizations.
Professional-services firms.
Those businesses can be affected when a multibillion-dollar program stops.
They can also benefit if it restarts.
The ultimate economic effect therefore extends beyond the $7 billion appropriated by the federal government.
Government funding can generate additional private spending, hiring, and investment around the projects it supports.
The opposite happens when projects are canceled.
Harris County Shows How Local the Impact Can Become
The Harris County case demonstrates how a national federal program translates into local economic activity.
Harris County says the broader Texas Solar for All effort involved more than $250 million in federal funding, including approximately $54 million intended for Harris County.
The county planned to use its portion for clean-energy initiatives serving lower-income households, including solar projects and community energy infrastructure.
Those plans also create opportunities for local contractors and suppliers.
When federal funding disappears, the effect isn’t confined to the government agency receiving the grant.
It moves through the local organizations and businesses expecting to perform the work.
That is why federal grant litigation can eventually become a local business story.
Contractors Should Still Be Cautious
Businesses that had expected work connected to Solar for All shouldn’t assume the court decisions eliminate the risk.
Some program procurement remains paused.
Grant recipients need clarity about their ability to access funds.
EPA could appeal.
Additional litigation could change the situation again.
Contractors should therefore distinguish between a project becoming legally possible again and a project becoming financially ready to proceed.
Those are not the same thing.
Before committing significant labor, equipment, or working capital, businesses should understand who is obligated to pay them and whether funding is actually available.
That lesson applies well beyond Solar for All.
The Decision Could Affect Solar Markets Differently by State
Solar for All was designed as a nationwide program, but implementation was decentralized.
Forty-nine state-level awards represented approximately $5.5 billion.
Six awards serving Tribal communities totaled more than $500 million.
Five multistate awards accounted for roughly another $1 billion.
That means the economic consequences can vary substantially by location.
Some states intended to expand existing solar programs.
Others were preparing significant new programs in markets where lower-income residential solar had previously been limited.
If funding resumes, some regions could see larger increases in installation activity, financing, and workforce demand than others.
Consumers Are Part of the Economic Equation
The program was primarily designed to expand access to solar among lower-income households.
EPA originally estimated that the $7 billion investment could generate more than $350 million in annual electricity-bill savings across participating households.
Whether those savings ultimately materialize will depend on which projects actually get built and how they perform.
But consumer savings matter economically because lower household energy expenses can free income for other spending.
That means the effects can extend beyond solar contractors.
Money households don’t spend on electricity can potentially be spent elsewhere in local economies.
Again, those are projected effects, not guaranteed outcomes.
The court rulings reopen the possibility of those outcomes; they don’t guarantee them.
What Businesses Should Watch Next
The most immediate question is whether EPA appeals either federal court ruling.
Businesses should also watch whether grant recipients begin reopening procurement processes and restarting projects.
The strongest evidence that the court decisions are translating into economic activity won’t be another legal filing.
It will be:
Requests for proposals reopening.
Contracts being awarded.
Workers being hired.
Equipment being ordered.
Projects moving into construction.
Until those things happen, uncertainty remains.
But the situation has changed materially.
A $7 billion program that appeared effectively terminated now has two federal court rulings challenging the legal basis for that termination.
For businesses and communities that had been preparing to participate, that puts projects that appeared dead back into the realm of possibility.
Impact: Potentially positive for grant recipients, solar businesses, contractors and participating communities, but still subject to substantial legal and administrative uncertainty.
Potential beneficiaries: Residential and community solar developers, installers, electrical contractors, equipment suppliers, financing providers, workforce-development organizations and participating state, local and Tribal communities.
Industries to watch: Solar energy, electrical contracting, construction, energy finance, distributed energy, battery storage and workforce development.
Sources
U.S. District Court for the District of Columbia — Harris County, Texas v. U.S. Environmental Protection Agency, Memorandum Opinion, September 22, 2026
https://law.justia.com/cases/federal/district-courts/district-of-columbia/dcdce/1%3A2025cv03646/285851/58/
U.S. Environmental Protection Agency — Greenhouse Gas Reduction Fund
https://www.epa.gov/aboutepa/greenhouse-gas-reduction-fund
U.S. Environmental Protection Agency — Solar for All Awards Announcement
https://www.epa.gov/newsreleases/biden-harris-administration-announces-7-billion-solar-all-grants-deliver-residential
Harris County Attorney — Harris County Secures Win in Court Over Solar for All Program
https://cao.harriscountytx.gov/Connect/Newsroom/harris-county-secures-win-in-court-over-solar-for-all-program