A $1.2 billion federal grant meant to fund a hydrogen energy plant serving Silicon Valley, the Port of Oakland, and other Bay Area regions has been abruptly canceled by the Trump administration amid the ongoing government shutdown — stalling what was expected to be a major clean energy initiative and source of hundreds of green jobs.

The project, slated for construction in Lodi, was designed to bolster California’s strained power grid, particularly in areas with rising energy demand from data centers. But it is now among several Bay Area projects halted after the Department of Energy terminated more than $377 million in federal grants across the region. The cancellations affect programs aimed at improving grid reliability, developing low-carbon building materials, and advancing A.I. data infrastructure.

Nationwide, the administration has cut roughly $28 billion in grants — with the overwhelming majority targeting Democrat-led congressional districts, according to DOE data. In California’s 12th District, represented by Democrat Lateefah Simon, over $200 million in federal funding has been revoked.

“Political retribution against Democratic districts is the point,” Simon said in a statement to Bay Area News Group. “Just two days into a Republican government shutdown, the Trump Administration canceled over $200 million worth of energy and infrastructure projects specifically located in CA-12.” DOE data shows that $27.24 billion in grants have been canceled in Democratic districts, compared to just $738 million in Republican areas.

Among the affected initiatives is a $189 million grant awarded to Brimstone LLC, an Oakland-based startup producing low-carbon cement. The company’s process was projected to cut 120,000 metric tons of carbon dioxide emissions per year — equivalent to taking 26,000 cars off the road — as part of a national effort to decarbonize construction materials under the Bipartisan Infrastructure Law and the Inflation Reduction Act.

Brimstone co-founder and CEO Cody Finke said earlier this year that the investment would help the U.S. lead a “global clean industrial revolution.” With the grant canceled, that vision is now in jeopardy.

Simon, who campaigned on bringing federal resources to her district, said the loss of energy and infrastructure funding undermines both economic opportunity and environmental progress. “These projects would have brought clean, affordable, and reliable energy to Californians, and thousands across the East Bay,” she said. “It has never been about cheap energy or American energy dominance to this administration.”

Nearby, Silicon Valley’s 17th District — represented by Democrat Ro Khanna — lost more than $100 million in funding, including $62 million for carbon capture research and $40 million for hydrogen hardware manufacturing. “This funding was helping bring clean, affordable energy to families in Silicon Valley,” Khanna said. “To compete with China in the 21st century, we need to invest more in renewable energy. Canceling these funds hurts American families and innovation.”

The hydrogen plant in Lodi was designed to use treated wastewater to extract hydrogen for use in fuel cells powering the Port of Oakland’s hydrogen trucks and data centers across Silicon Valley. Local officials say the cancellation jeopardizes hundreds of potential jobs and significant environmental gains.

“It would have made Lodi a bastion for green energy jobs in the country,” said City Councilmember Mikey Hothi. “And so not only is this impacting potential employment for people in the city of Lodi, it’s impacting folks throughout Northern California.”

For now, Lodi’s natural gas plant will remain the city’s main power source. Still, Hothi said he hopes the project will resume once political tensions ease. “Eventually, when the politics and the tensions settle down, people are going to realize that this is a shovel-ready project in our backyard,” he said. “Whether it happens tomorrow is more uncertain. But in my lifetime, I hope we’re going to see a hydrogen facility at this location.”