White House awards $20 billion to coalitions to spur climate projects

The Environmental Protection Agency Thursday announced $20 billion of grants to spur clean energy projects primarily in underserved areas, marking the largest federal investment to date in climate-related projects.

The money, divided among eight applicants, marks the official launch of the $27 billion Greenhouse Gas Reduction Fund created by President Joe Biden’s 2022 Inflation Reduction Act, the EPA’s signature program created to function as a green bank to support agencies and organizations that finance clean energy projects. The remaining $7 billion will go to states, local governments and other entities for solar projects. Congressional Republicans have criticized the program as a “slush fund” with little oversight and the House in March passed a bill to repeal it. Biden said he would veto the legislation in the unlikely event it lands on his desk.

Vice President Kamala Harris and EPA Administrator Michael Regan were headed to North Carolina Thursday to tout the grants that officials said would create a national network of climate-related lenders.

“The grants announced today will help ensure that families, small businesses and community leaders have access to the capital they need to make climate and clean-energy projects a reality in their neighborhoods,” Harris said in a statement.

Bloomberg

The greenhouse reduction program aims to “combat the climate crisis by catalyzing public and private capital for projects,” the White House said in a release. “This program will ensure communities across the country have access to the capital they need to participate in and benefit from a cleaner, more sustainable economy.”

At least 70% of the $20 billion will go to low-income and disadvantaged communities. The winners will partner with private entities to offer low-interest loans to thousands of clean-energy projects like clean power generation, retrofits of homes and zero-emission transportation.

The money will leverage $7 in private capital for every $1 in public investment, EPA officials said. The nonprofits have pledged to spend 70% of the money in low-income or disadvantaged communities.

The largest award, almost $7 billion, will go to the Climate United Fund, a trio of nonprofits that include two community development financial institutions, and $5 billion will go to the Coalition for Green Capital, which will create a national green bank to partner with existing state and local climate banks and with an “emphasis on public private investing,” the White House said.

The EPA launched the competition last July. The grants come from two programs: the National Clean Investment Fund provides $14 billion and the Clean Communities Investment Accelerator provides $6 billion of grants. The Greenhouse Gas Reduction Fund also includes the Solar for All program, which will provide $7 billion for up to 60 grants awarded to states, territories, tribes, municipalities, and nonprofits to expand residential solar programs in low-income and disadvantaged areas.

The EPA estimated that projects supported by the grants would reduce or avoid up to 40 million metric tons of carbon pollution each year over the next seven years.

“Today, we’re putting an unprecedented $20 billion to work in communities that for too long have been shut out of resources to lower costs and benefit from clean technology solutions,” the EPA’s Regan said in a statement.