Q&A: How The Federal Biden Administration Plans to Roll Out $20 Billion in Financing for Clean Energy Development

From our collaborating partner “Living on Earth,” public radio’s environmental news magazine, an interview by Host Steve Curwood with David Cash, administrator of the Environmental Protection Agency’s New England Region.

As part of the bid by the Biden administration to fight climate disruption, the Environmental Protection Agency recently awarded $20 billion to help finance clean energy projects across the United States. The money is part of the Greenhouse Gas Reduction Fund, created under the Inflation Reduction Act.

Unlike a typical grant program, though, the EPA will not fund projects directly. Instead, it is providing grants to select organizations that will turn around and offer low-interest loans in communities that need them the most.

The $20 billion in federal funds is expected to stimulate as much as $150 billion more in private capital to advance the clean energy transition.

This interview has been edited for length and clarity. 

STEVE CURWOOD: What sort of work went into building this grant program?

DAVID CASH: The Greenhouse Gas Reduction Fund is just one of the many, many different efforts that the EPA and the Biden-Harris administration are making to address the climate crisis and to grow the clean energy economy here and to reduce energy costs for people all over the country. 

With the program, EPA is creating a first of its kind national network of mission-driven, community-led financial institutions. You could think of these institutions as loan funds that can go out to communities that will finance climate and clean energy projects, especially in low-income and disadvantaged communities.

CURWOOD: I gathered there are a couple of parts of this process. What are they?

CASH: There are three big parts of the Greenhouse Gas Reduction Fund. The first is the $7 billion Solar for All Program. We haven’t made a final announcement on that; it’s coming probably later in the spring. 

The two other big pieces that were announced are the National Clean Investment Fund—that’s $14 billion—and the Clean Communities Investment Accelerator, which is another $6 billion, so $20 billion.

The National Clean Investment Fund has three selected applicants, and those will create funds, partnering with the private sector to provide accessible, affordable financing for tens of thousands of clean energy projects nationwide, so enabling individuals, families, nonprofits, governments and businesses to access capital in a way that they haven’t been able to before. We know that there has been under-investment in this country in clean energy, clean technology, clean deployment. That’s what this is designed to do.

CURWOOD: Give me a couple of examples of what this might look like.

CASH: Let’s say, for example, there is an affordable housing provider that’s rehabilitating a 50- year old, 200-unit, section eight rental property. We know these are all over the country, these kinds of affordable housing projects. And they may be short on financing to fully electrify the building, to get them up to a way where they’ll be as energy efficient as possible. So the funds can then help finance that network. The affordable housing provider can turn to that network and fill the specific financing gaps for these kinds of projects. 

And let me bring this down to the really personal level. We visited a public housing unit in Boston where we met with some of the tenants who showed us the gap underneath their door that they said snow blew into, they showed us windows that didn’t close completely, they showed us old appliances that were incredibly energy inefficient. This kind of funding is going to be able to rehab that apartment to make sure that that family is comfortable, pays less for their electric bill, has new appliances and is part of the clean energy future. 

We see these funds leveraging private funding in a seven to one ratio, about $150 billion for a $20 billion investment, roughly. It’s going to be huge.

CURWOOD: Let’s talk about the other part of that.

CASH: The Clean Communities Investment Accelerator, those are designed to establish hubs to provide funding and technical assistance to community lenders. That $6 billion is going to low income and disadvantaged communities. A large section of that prior one I mentioned to you, the $14 billion, is also going to low income and disadvantaged communities. Those communities, by the way, have suffered under the burden of pollution in the last decades. And in fact, those communities that have been dependent on the fossil fuel economy, but have seen that waning. So these are funds that can go out to those communities and create a new clean energy economy and jobs and investments there as well. 

Federal government can be “top down.” These programs are designed to be bottom up, to respond to the needs of communities so that communities are driving where investments go.

CURWOOD: How can these communities get access to these funds? Typically, more affluent communities have people who know how to write grant proposals and work the government system. If you’re living in public housing, where the snow is blowing under the door, it’s unlikely that you can navigate the system. How do you get folks who need it plugged into the system?

CASH: Here’s one of the things that was brilliant about the way that our team in headquarters structured the competition process for these. Each of the winners have had to articulate how they are going to connect precisely with the community lenders, such as community development, financial institutions, credit unions, minority depository institutions, how they’re going to connect with those so that when you have a household, or even a community organization, they’re already going to be tapped in to the network. So that communicating about the availability of these kinds of funding opportunities, these revolving loan funds will be made more and more apparent to those who precisely need it. 

One of the hubs is going to be Appalachian Community Capital, a nonprofit CDFI, which has a decade of experience working with community lenders, and Appalachian communities, so they know who to go to. And similar on the tribal side, so tribal communities will know where to go.

CURWOOD: For folks who don’t know, what’s a CDFI?

CASH: It’s a community development financial institution. You can think of it as a lending institution, a bank that is closely connected to communities that otherwise would have a difficult time raising capital. In your relatively wealthy communities, there’s going to be a lot of understanding about how to access this capital and these CDFIs go a long way toward creating that capacity in [disadvantaged] communities.

CURWOOD: If you were to summarize, what are the environmental issues that these grant programs are seeking to redress?

CASH: Clearly, the climate crisis. We know that we need to take urgent action on that. These investments are going to go a long way in reducing emissions that cause climate change by deploying solar and wind, electric vehicles, by doing energy efficiency, which in many cases is by far the cheapest way to reduce emissions. So that’s one.

The other is addressing local air pollution. Again, we know whether it’s through power plants, or manufacturing facilities, or buses, or trucks or cars, that local air pollution is a huge problem and a huge problem in communities that have been overburdened by these pollutants for decades upon decades. 

And then on the water side, we see the replacement, for example, of lead pipes as incredibly important for communities that have relied on the old housing stock. We see a lot of that in New England, of course, where we have buildings that are 100-plus years old, we’re going to find a lot of lead pipe. And we know that lead is particularly damaging to children. President Biden has a goal to get rid of all lead pipes in the next 10 years. There’s billions of dollars that are in a bipartisan infrastructure law that’s going to address that. 

And of course, it goes hand in glove with creating new clean energy jobs, whether it’s to put a solar panel on your roof or replace the windows or put in heat pumps. Those are all opportunities for huge job growth.

CURWOOD: How excited are you about this $20 billion and this program that you have the folks at the EPA are now administering?

CASH: EPA had grant programs and got money out the door—but nothing, nothing on the scale of what we’re doing now. It’s incredibly exciting, because we’re at a moment where it’s both incredibly urgent that we take action and we have huge opportunities. 

To be part of an agency that is going to be providing funding in the way that we’re providing it, lifting up communities, helping them identify what they need, where they want the investments to be, so that they can reduce their costs and breathe cleaner air and be part of the clean energy job growth—I mean, that’s incredibly exciting. 

And for this project, to be just part of one of many that EPA, the Department of Energy, Department of Commerce, are working on to get these kinds of results is very, very exciting. I wake up every morning and, basically, I skip to work.