Trump administration redirected $500 million clean-steel grant to fund coal-fired furnace at Ohio steel mill

On August 21, 2026, the U.S. Department of Energy announced it was redirecting a $500 million grant, originally awarded to Cleveland-Cliffs in March 2024 to decarbonize its Middletown, Ohio, steel mill, to instead fund continued operation of the plant's coal-fired blast furnace. Vice President JD Vance, whose grandfather worked at the Middletown plant for nearly 40 years, and Energy Secretary Chris Wright appeared on-site to promote the change alongside Cleveland-Cliffs CEO Lourenco Goncalves.

The grant was part of a $6.3 billion Biden-era Inflation Reduction Act program to decarbonize U.S. manufacturing, and Cleveland-Cliffs' original plan called for replacing the plant's aging blast furnace with hydrogen-ready electric furnaces, eliminating roughly 1 million tons of annual emissions. Under the revised scope, Cleveland-Cliffs will instead use the grant, matched by $500 million of its own money, to refurbish and extend the blast furnace's operating life by up to two decades and build a cogeneration plant that converts furnace waste gases into electricity. A former DOE official said the revised scope conflicts with the Inflation Reduction Act's statutory definition of eligible "advanced industrial technology," which requires funded projects to accelerate progress toward net-zero emissions; the revised project moves the plant away from that goal rather than toward it.

Middletown residents and environmental groups objected that continuing to burn coal will prolong industrial air pollution near the plant. Cleveland-Cliffs said the change reflected customers' unwillingness to pay a "green premium" for steel, and DOE officials framed the revised award as protecting roughly 2,300 jobs and strengthening domestic steel production.