The decision, announced July 23, underscores a broader shift in federal lending priorities away from renewable energy infrastructure under the Trump administration.

“After a thorough review of the project’s financials, DOE found that the conditions necessary to issue the guarantee are unlikely to be met and it is not critical for the federal government to have a role in supporting this project,” the agency said in its announcement, adding it was now operating with “a lower risk tolerance … and an uncompromising focus on … reliable energy.”

Grain Belt Express, an 800‑mile, 600-kV high-voltage direct current line, was designed to carry up to 5 GW of wind and solar power from Kansas through Missouri to Illinois and Indiana. Its first phase, covering 530 miles from western Kansas to central Missouri, was expected to cost $4.4 billion, including converter stations and right-of-way acquisition.

Regulatory filings reviewed by ENR show that while Grain Belt Express secured voluntary transmission service agreements with 39 Missouri municipal utilities—amounting to up to 225 MW—those agreements did not include binding long-term revenue commitments.

Under a 2023 Kansas Corporation Commission settlement, the developer was required to demonstrate documented financing and enforceable customer offtake contracts before construction could begin. 

DOE’s Loan Programs Office ultimately concluded that the project’s speculative revenue model, reliant on nonbinding agreements, failed to meet a risk threshold for federal loan backing.

In a statement to ENR, a Grain Belt Express spokesperson said the project remains undeterred by the loss of federal funds and that its mission to deliver energy would continue forward by securing capital through other sources. "America is energy dominant and an AI powerhouse, and Grain Belt Express will be America’s largest power pipeline," the spokesperson wrote in an email. 

"While we are disappointed about the LPO loan guarantee, a privately financed Grain Belt Express transmission superhighway will advance [the Trump administration's] agenda of American energy and technology dominance while delivering billions of dollars in energy cost savings, strengthening grid reliability and resiliency, and creating thousands of American jobs," the spokesperson added.

Environmental groups and consumer advocates criticized the termination.

The Sierra Club’s Missouri Chapter Director, Gretchen Waddell‑Barwick, told the Missouri Independent the cancellation “reeks of desperation to satisfy political interests … at the expense of Missouri families and businesses throughout the state that may have to pay higher electric rates because of this decision.” In Illinois, the Environmental Law & Policy Center and other groups argued in a legal brief that stopping Grain Belt would impede progress toward clean-energy goals and grid reliability under the state’s Clean and Equitable Jobs Act.

New Energy, New Revenue Scheme

Unlike regulated utility projects, which recover costs through approved ratepayer charges, merchant transmission lines like Grain Belt rely on market demand and voluntary customer contracts. 

DOE requires such projects to demonstrate predictable cash flows through binding agreements—so-called “compliance fences”—before committing taxpayer-backed financing.

By contrast, the Champlain Hudson Power Express, a 1,200-MW HVDC line linking Quebec to New York City, secured 25-year delivery contracts with state authorities prior to financial close. Pattern Energy’s SunZia Transmission in New Mexico, with 3 GW capacity over 550 miles, closed an $11-billion private financing deal in 2023 backed by long-term customer agreements. Southern California Edison’s 4,500 MW Tehachapi Renewable Transmission Project, which entered service in 2016, followed a traditional regulated utility model with guaranteed cost recovery.

Political opposition to Grain Belt led Missouri officials to become increasingly vocal about the project’s federal support. The project’s loan guarantee was announced in November 2024 as part of a wave of clean energy financing approvals by the Biden administration in the final months of his term. On July 10, Sen. Josh Hawley (R-Mo.) on the social media website X, called on DOE to withdraw the loan guarantee, “This administration should stop using taxpayer money to prop up speculative green energy boondoggles,” he wrote.

Grain Belt Express countered the narrative, calling Hawley’s characterization “bizarre” on its website, and warning that cancellation threatens to derail “the largest transmission infrastructure project in U.S. history.” 

A last-ditch effort to save the funding by Jim Shield, vice president of Invenergy, the project’s developer, was framed in dire terms, according to a copy of a letter sent to Energy Secretary Chris Wright. “Major U.S. construction contractors are counting on $1.7 billion in awards,” Shield said, noting contracts in April to Quanta Services and Kiewit. “American workers will manufacture key components—including conductor cables, insulators and transmission assemblies—supporting domestic supply chains from Pennsylvania to Alabama,” he added.

Missouri Attorney General Andrew Bailey, who opened a consumer protection investigation into Grain Belt earlier this year, welcomed DOE’s decision. He pledged to continue legal action if Invenergy attempts to move forward without federal support. 

The DOE decision reflects a broader shift in Trump administration policy. Recent executive orders have paused solar and wind subsidies and increased scrutiny of renewable energy projects on federal lands. The gyrations affecting Grain Belt Express highlight challenges merchant transmission developers face without a robust customer base or—critically—federal backing.

However, financing hurdles for projects like Grain Belt Express are not insurmountable, Mat Merten, principal of Knoxville, Tenn.-based SIL Safe, an engineering consultant, explained in an email. 

"Absolutely the project can still proceed," he said. "This was not a grant, it was a loan with favorable terms; private loans are still possible but would be less favorable." 

Merten noted that, although major construction has not started, much of the design and permitting have already been completed. "Perhaps there could be a trade-off, such as a longer timespan," he said, adding, "the project is not doomed."

Comparison of financing approaches for major U.S. transmission projects. Unlike Champlain Hudson and SunZia, which secured binding long-term agreements and finalized private financing before construction, Grain Belt Express relied on non-binding transmission service agreements that the US Energy Dept claimed did not meet financial readiness benchmark.