The U.S. Environmental Protection Agency (EPA) recently released new details about the design of the $27 billion Greenhouse Gas Reduction Fund (GGRF), a first-of-its-kind, national-scale competitive grant program created by the President’s Inflation Reduction Act. This program, part of the Investing in America agenda, will leverage public investment with private capital and finance clean energy projects that reduce pollution and energy costs, increase energy security, and create good-paying jobs, especially in low-income and disadvantaged communities and places that have historically shouldered the burden of harmful pollution. The GGRF will catalyze investment in thousands of clean energy projects, build the capacity of community lenders to drive local economic growth, and deploy cost-saving solar energy on rooftops and in communities across the country.
The release of the GGRF implementation framework comes as the EPA marks Earth Week and the unprecedented investments in protecting the planet and American families and communities as part of President Biden’s Investing in America agenda.
This implementation framework follows the initial guidance EPA released earlier this year and outlines a clear vision for the three grant competitions EPA will administer under the GGRF program, including preliminary descriptions of key parameters, application requirements, and reporting obligations.
The release of this framework builds on months of robust stakeholder engagement efforts with input collected from state, local, and Tribal governments; community lenders; environmental justice organizations; industry groups; labor; and environmental finance experts across the country.
The implementation framework is intended to provide continued transparency and respond to stakeholder requests for additional information on EPA’s anticipated program design and application requirements in advance of the Notices of Funding Opportunity that will formally kick off the application process as early as June 2023 and reflect EPA’s final determinations on program priorities and requirements.
EPA will require rigorous transparency, risk management, and accountability measures of grantees under this program to ensure this historic investment is invested efficiently in accordance with the law and for the maximum benefit of American families.
Greenhouse Gas Reduction Fund Grant Competitions
EPA will hold three complementary competitions to strategically distribute grant funding under the $27 billion GGRF program. While each competition will be administered separately, EPA expects that these competitions will work in tandem to deliver tangible benefits including lower energy costs, good-paying jobs and improved public health outcomes to households, businesses, and communities. The three competitions will be:
- The $14 billion National Clean Investment Fund competition will fund two to three national nonprofits that will partner with private capital providers to deliver financing at scale to businesses, communities, community lenders, and others, catalyzing tens of thousands of clean technology projects to accelerate our progress towards energy independence and a net-zero economic future.
- The $6 billion Clean Communities Investment Accelerator competition will fund two to seven hub nonprofits with the plans and capabilities to rapidly build the clean financing capacity of specific networks of public, quasi-public and non-profit community lenders—including community development financial institutions (including Native CDFIs), credit unions, green banks, housing finance agencies, and minority depository institutions—to ensure that households, small businesses, schools, and community institutions in low-income and disadvantaged communities have access to financing for cost-saving and pollution-reducing clean technology projects.
- The $7 billion Solar for All competition will provide up to 60 grants to States, Tribal governments, municipalities, and nonprofits to expand the number of low-income and disadvantaged communities that are primed for residential and community solar investment—enabling millions of families to access affordable, resilient, and clean solar energy.
EPA will implement these programs in alignment with President Biden’s Justice40 Initiative, which aims to ensure that 40% of the overall benefits of certain Federal investments flow to disadvantaged communities that are marginalized, underserved, and overburdened by pollution. EPA expects to open competitions for funding under the Greenhouse Gas Reduction Fund by summer 2023.