Finance

California pauses home energy rebate program amid Trump funding freeze

Published

3 months ago

March 5, 2025

Business Finance News

The U.S. Department of Energy on Feb. 14, 2025 in Washington, D.C.

Anna Moneymaker | Getty Images News | Getty Images

California has paused rebate programs offering thousands of dollars to consumers who make their homes and appliances more energy efficient due to a Trump administration freeze on federal funding.

While a handful of other states also recently halted their programs, California is the largest state to delay a rollout so far — putting $582 million earmarked for consumers and program administration at risk.

California had issued its first rebate check to consumers in February, according to the state’s Energy Commission.

“Many states were just getting started on their programs, and suddenly they’re tossed into turmoil,” said Lowell Ungar, director of federal policy at the American Council for an Energy-Efficient Economy.

President Trump moves to halt federal grants

The programs in question, Home Energy Rebates, were created through the Inflation Reduction Act. President Biden signed it into law in 2022.

The law allocated up to $8.8 billion of federal funds for states, territories and the District of Columbia to disburse to consumers in the form of rebates.

Consumers were provided up to $8,000 of Home Efficiency Rebates and up to $14,000 of Home Electrification and Appliance Rebates, per federal law. Maximum amounts vary per household, depending on factors like income eligibility.

The rebates aim to reduce the cost of home upgrades like installing insulation and heat pumps or buying efficient appliances like electric stoves — with an eye to also reducing consumers’ energy bills and cutting planet-warming carbon emissions.

All states except South Dakota had applied for the federal funds. The U.S. Department of Energy approved those applications, and states were in various phases of rollout by the end of the Biden administration.

However, the Trump administration on Jan. 27 put a freeze on the disbursement of federal funds that conflict with the president’s agenda, including initiatives related to green energy and climate change.

The fate of that freeze is up in the air as courts weigh legal challenges to the policy.

The U.S. Department of Energy didn’t return a request from CNBC for comment.

The California Energy Commission — which had launched an $80 million first phase of its home energy rebate program in the fall — paused its program on Feb. 25, according to a California Energy Commission website.

The pause will remain in place “until the Trump Administration provides additional information on the funding,” Commission staff wrote in an e-mailed statement.

California was approved for the second-largest tranche of funding for the energy rebate programs, behind only Texas. (The U.S. Energy Department awarded $689 million to Texas, according to an archived federal website.)

The Texas State Energy Conservation Office didn’t return a request for comment on the status of its program.

Since Jan. 31, California hasn’t been able to successfully draw down funds for administrative costs to run its rebate program, according to a California Energy Commission website. The U.S. Energy Department has also removed information about Home Energy Rebate programs from its website, the CEC said.

Not all states have paused their programs, however.

For example, officials in Maine and North Carolina recently confirmed to CNBC that funding through their rebate programs remains available — for now.

The North Carolina Department of Environmental Quality is “closely watching any federal actions that may change the operations of the Energy Saver NC program,” a spokesperson said in an e-mailed statement.

Different states may have “different risk tolerances” when it comes to administering these programs and issuing rebates when it’s unclear if they’ll eventually be reimbursed, Ungar said.

Finance

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Published

2 days ago

June 6, 2025

Business Finance News

Finance

Swiss government proposes tough new capital rules in major blow to UBS

Published

2 days ago

June 6, 2025

Business Finance News

A sign in German that reads “part of the UBS group” in Basel on May 5, 2025.

Fabrice Coffrini | AFP | Getty Images

The Swiss government on Friday proposed strict new capital rules that would require banking giant UBS to hold an additional $26 billion in core capital, following its 2023 takeover of stricken rival Credit Suisse.

The measures would also mean that UBS will need to fully capitalize its foreign units and carry out fewer share buybacks.

“The rise in the going-concern requirement needs to be met with up to USD 26 billion of CET1 capital, to allow the AT1 bond holdings to be reduced by around USD 8 billion,” the government said in a Friday statement, referring to UBS’ holding of Additional Tier 1 (AT1) bonds.

The Swiss National Bank said it supported the measures from the government as they will “significantly strengthen” UBS’ resilience.

“As well as reducing the likelihood of a large systemically important bank such as UBS getting into financial distress, this measure also increases a bank’s room for manoeuvre to stabilise itself in a crisis through its own efforts. This makes it less likely that UBS has to be bailed out by the government in the event of a crisis,” SNB said in a Friday statement.

‘Too big to fail’

UBS has been battling the specter of tighter capital rules since acquiring the country’s second-largest bank at a cut-price following years of strategic errors, mismanagement and scandals at Credit Suisse.

The shock demise of the banking giant also brought Swiss financial regulator FINMA under fire for its perceived scarce supervision of the bank and the ultimate timing of its intervention.

Swiss regulators argue that UBS must have stronger capital requirements to safeguard the national economy and financial system, given the bank’s balance topped $1.7 trillion in 2023, roughly double the projected Swiss economic output of last year. UBS insists it is not “too big to fail” and that the additional capital requirements — set to drain its cash liquidity — will impact the bank’s competitiveness.

At the heart of the standoff are pressing concerns over UBS’ ability to buffer any prospective losses at its foreign units, where it has, until now, had the duty to back 60% of capital with capital at the parent bank.

Higher capital requirements can whittle down a bank’s balance sheet and credit supply by bolstering a lender’s funding costs and choking off their willingness to lend — as well as waning their appetite for risk. For shareholders, of note will be the potential impact on discretionary funds available for distribution, including dividends, share buybacks and bonus payments.

“While winding down Credit Suisse’s legacy businesses should free up capital and reduce costs for UBS, much of these gains could be absorbed by stricter regulatory demands,” Johann Scholtz, senior equity analyst at Morningstar, said in a note preceding the FINMA announcement.

“Such measures may place UBS’s capital requirements well above those faced by rivals in the United States, putting pressure on returns and reducing prospects for narrowing its long-term valuation gap. Even its long-standing premium rating relative to the European banking sector has recently evaporated.”