The Trump administration's Environmental Protection Agency (EPA) has lost its bid to claw back $20 billion in climate funds already disbursed to non-profit groups. An appeals court ruled on Tuesday that the EPA did not have the authority to terminate and reclaim funding that had been deposited into these organisations' bank accounts.

Eight environmental non-profits, including Climate United and Power Forward Communities, sought to regain access to billions of dollars after their accounts were frozen by the EPA, alongside the FBI and the Treasury Department in February 2025. While some groups have had to enact significant budget cuts during this period, they will now be able to access their funding.

The decision upholds an injunction that prevents the EPA from reclaiming funds already disbursed into the non-profits' accounts. The judges deemed the EPA’s actions as a ‘policy disagreement’ and ruled that the One Big Beautiful Bill Act (OBBBA) did not provide legal grounds to claw back the money, given it had already been obligated and dispersed.

However, some groups may have missed their stride; Climate United's CEO left in March without replacement, while Power Forward Communities now operates with just two employees. The EPA has seven days to appeal the decision to the Supreme Court.