What implications does the Greenhouse Gas Reduction Fund (GGRF) hold for the renewable energy landscape, and how can organizations strategically prepare for it?
The GGRF, with its substantial $27 billion allocation, presents an opportunity for stakeholders in the renewable energy sector, including states, investors, developers, Community Development Financial Institutions (CDFIs), Community Lenders and tribal entities. By leveraging this fund, organizations can accelerate the deployment of energy generation and energy efficiency solutions. The GGRF will lead to the emergence of green banks and increased capital investment in renewable energy solutions, thereby creating a robust pipeline for real estate and energy projects.
Overall program: Through financial assistance (i.e. grants, subsidies, rebates, loans or other incentives) and technical assistance, communities, developers and homeowners can transition residential properties to be powered by solar energy. Except for six, all states received funding to implement Solar for All programs. States that opted out include: Florida, Idaho, Montana, North Dakota, Nevada and South Dakota. However, projects within these states can receive funding through the funding for American Indian and Alaskan Native Program and the Multi-State Program managed by Solar for All recipient not-for-profits or municipalities serving the area.
What are qualified projects:
What types of projects are eligible under Solar for All: Eligible projects under the accelerator fund must meet the following criteria:
Overall program: Community Lenders have the right to receive up to $10 million to provide financial assistance and $1 million in technical assistance for staff and overhead. It is expected that the financial assistance to projects will be provided on more favorable terms than market. The financial assistance is deemed to be a loan, it can be forgivable if the Community Lender desires. Community Lenders are only able to access the $10 million once they have identified a qualified project to deploy the capital into.
Who are Community Lenders: New or existing public, quasi-public or not-for-profit entities that provide financial assistance to qualified projects at the state, local, territorial or tribal level or in the District of Columbia, including community- and low-income-focused lenders and capital providers. This includes but not limited too:
What are qualified projects: Section 134(c)(3) of the Clean Air Act provides that qualified projects include any project, activity or technology that (A) reduces or avoids greenhouse gas emissions and other forms of air pollution in partnership with, and by leveraging investment from, the private sector; or (B) assists communities in the efforts of those communities to reduce or avoid greenhouse gas emissions and other forms of air pollution. EPA expects to implement this statutory language by requiring that all projects meet all of the requirements listed below, which ensures all projects meet the statutory definition while also supporting the GGRF program objectives. EPA expects that each applicant will define their methodology for operationalizing these requirements in their application. EPA expects to define these requirements as follows:
Priority project categories: EPA has identified three priority project categories that are particularly impactful to achieving the GGRF program objectives and the near-term climate goals of the United States. EPA expects each applicant to explain their approach to these priority project categories in their investment strategies, but EPA expects to provide each applicant with flexibility to (1) invest in additional project categories and (2) not invest in any given priority project category, provided this decision is accompanied with a supporting explanation. EPA expects that specific guidance and standards, such as emissions reductions targets, for priority project categories may be provided in the NOFO.
What types of projects are eligible under the CCIA: Eligible projects under the accelerator fund must meet the following criteria:
Overall program: Contractors, coalition members, not-for-profits and community-based organizations may receive financing for a qualified project or complete pre-development and market-building activities to reduce greenhouse gas emissions, particularly in low-income and disadvantaged communities.
What are qualified projects: Section 134(c)(3) of the Clean Air Act provides that qualified projects include any project, activity or technology that (A) reduces or avoids greenhouse gas emissions and other forms of air pollution in partnership with, and by leveraging investment from, the private sector; or (B) assists communities in the efforts of those communities to reduce or avoid greenhouse gas emissions and other forms of air pollution. EPA expects to implement this statutory language by requiring that all projects meet all of the requirements listed below, which ensures all projects meet the statutory definition while also supporting the GGRF program objectives. EPA expects that each applicant will define their methodology for operationalizing these requirements in their application. EPA expects to define these requirements as follows:
Priority project categories: EPA has identified three priority project categories that are particularly impactful to achieving the GGRF program objectives and the near-term climate goals of the United States. EPA expects each applicant to explain their approach to these priority project categories in their investment strategies, but EPA expects to provide each applicant with flexibility to (1) invest in additional project categories and (2) not invest in any given priority project category, provided this decision is accompanied with a supporting explanation. EPA expects that specific guidance and standards, such as emissions reductions targets, for priority project categories may be provided in the NOFO.
What types of projects are eligible under the NCIF: Eligible projects under the accelerator fund must meet the following criteria:
Tune in as Joel Laubenstein, Jeannine Jacokes, Rob Hazelton and Serena Walters discuss key takeaways and important next steps for considerations. The discussion dives into the GGRF timeline and offers actionable guidance for developers, investors and energy leaders to position their projects effectively and stay ahead of federal compliance requirements. Explore strategies for identifying the right project partners and assembling a reliable project team. This webinar also includes:
Discover how you can capitalize on the GGRF with our turnkey program design and deploy solution. We can help your organization maximize project funding by building a capital stack to include Inflation Reduction Act tax credits and other pairing sources. Are you eligible?
