Article By DWGP Summer Associate Emily Hutchins - University of Miami School of Law 2023On July 14, the Biden Administration announced its plan to dedicate $20 billion toward clean energy projects through two grant competitions funded under the Environmental Protection Agency’s (EPA) Greenhouse Gas Reduction Fund established under the Inflation Reduction Act. The aim of these competitions is to aid the United States in achieving its greenhouse gas emission reduction targets by extending clean energy support and encouraging the development of projects in underserved communities.
The National Clean Investment Fund will distribute up to $14 billion in grants, supporting up to three national nonprofit financing entities to create national clean financing institutions. These institutions will partner with the private sector to provide financing for clean technology projects deployed by individuals, nonprofit organizations, for-profit businesses, and governments. A minimum of 40% of the allocated funds will be reserved for low-income and disadvantaged communities, including rural communities, Tribal communities, and energy communities, such as brownfields and coal communities.
The Clean Communities Investment Accelerator will provide up to an additional $6 billion in grants to support up to seven hub nonprofit organizations. An eligible nonprofit provides capital and financial assistance for the rapid deployment of low- and zero-emission products, technologies, and services; does not accept deposits, except for repayments and other revenue received from financial assistance provided using grant funds under this program; is funded by public or charitable contributions; and invests in or finances projects individually or with other investors. These hub nonprofits will provide funding and assistance to public, quasi-public, not-for-profit, and nonprofit community lenders to finance clean technology projects in low-income and disadvantaged communities.
Funding from these two competitions builds upon the EPA’s June announcement of the Solar for All Competition, which committed $7 billion in funds. The Solar for All Competition will provide up to 60 grants to states, territories, Tribal Governments, municipalities, and eligible nonprofits to establish and expand low-income solar projects. Collectively, the three competitions could provide an estimated $27 billion in investments with the goal of curbing greenhouse gas emissions.
Eligible clean energy projects are those that reduce or avoid greenhouse gas emissions and other air pollutants while delivering additional benefits. Projects may center on clean energy and energy efficiency, clean transportation, affordable and sustainable housing, or training and workforce development. For example, residential heat pumps, electric vehicle charging stations, and community cooling centers would qualify for grant opportunities. These investments are expected to attract private sector investment while benefiting rural and energy communities through reduced project risks.
Program applications must be submitted by October 12, 2023, with grant awards expected to be announced by March 2024.
For more information on eligibility criteria and the application process for the grant competitions, please contact Keith Gordon, Jeff Genzer, or Gelane Diamond.
The EPA’s press release regarding the grant competitions can be found here.
