This week, PA DEP posted the Slide Deck from its February 22, 2024 – Pennsylvania Energy Development Authority (PEDA) Board Meeting. – The information presented during the PEDA Board meeting inspired us to prepare the following background/update piece on BIL/IRA Green Bank/low interest loan financing in Pennsylvania. (PA Board of Directors Meeting Slides).
There are millions of good reasons (potentially far more than $375 million) to refresh your recollection about Greenhouse Gas Reduction Fund and DOE Loan Program Office program implementation in Pennsylvania.
Apologies in advance to members of the GGRF Workgroup that have seen some of these materials before. Highlights are below and the PEDA Meeting Slides and a “mini Digest” with program background are attached. Many thanks to RMI for the materials presented at its BIL/IRA Economic Development “Bootcamp” earlier this year.
PEDA Briefing Materials – (PA Board of Directors Meeting Slides)
Governor’s Office of Critical Investments Report on BIL/IRA Implementation
- PA Gov’s Office Invitation to Present Clean Energy Projects (PDF pages 8-19)
- Current Focus is schools & municipal assets – but other projects are eligible.
PFM’s Description of Inaugural Energy Accelerator Programs (EAP) (PDF pages 20-23)
- PEDA’s EAP Product #1 & EAP Product #2 are expected to total $10 million and $15 million, respectively.
- PEDA hopes to receive EPA’s Greenhouse Gas Reduction Fund funding:
- $250 million under the Solar for All program
- National Clean Investment Fund/Clean Communities Investment Accelerator
- PEDA is exploring a $100 million loan guaranteed by the Department of Energy to facilitate seed funding for a Solar for Schools Program
NEIF’s Description of PA KEEP Home Energy Loan Program “EAP Product #1” (PDF pages 24-35)
PA DEP Description of Municipal Opportunities for Retrofits and Energy Efficiency Proposal “EAP Product #2” (PDF pages 36-45)
PA DEP Description of PA Solar for All Application and Program (PDF pages 46-47)
Bottom Line: PEDA will roll out at least $375 million in seed money & financing in 2024-2025.
Better yet, the PA Governor’s Office of Critical Investments has invited all of us to come up with creative ways to deploy these resources.
PA DEP Briefings on February 22, 2024 from Pennsylvania Energy Development Authority (PEDA) Board Meeting and Briefing Materials (PA Board of Directors Meeting Slides)
Governor’s Office of Critical Investments Report on BIL/IRA Implementation
- PA Gov’s Office Invitation to Present Clean Energy Projects (PDF pages 8-19)
- Current Focus is schools & municipal assets – but other projects are eligible.
PFM’s Description of Inaugural Energy Accelerator Programs (EAP) (PDF pages 20-23)
- PEDA’s EAP Product #1 & EAP Product #2 are expected to total $10 million and $15 million, respectively.
- PEDA hopes to receive EPA’s Greenhouse Gas Reduction Fund funding:
- $250 million under the Solar for All program
- National Clean Invest. Fund/Clean Communities Investment Accelerator
- PEDA is exploring a $100 million loan guaranteed by the Department of Energy to facilitate seed funding for a Solar for Schools Program
NEIF’s Description of PA KEEP Home Energy Loan Program “EAP Product #1” (PDF pages 24-35)
PA DEP Description of Municipal Opportunities for Retrofits and Energy Efficiency Proposal “EAP Product #2” (PDF pages 36-45)
PA DEP Description of PA Solar for All Application and Program (PDF pages 46-47)
Bottom Line: PEDA will roll out at least $375 million in seed money & financing in 2024-2025.
Background: Greenhouse Gas Reduction Fund (GGRF) Program
In February 2023, EPA Announced an Initial Program Design of GGRF on February 14, 2023. Critical components of this Program Design include: EPA will hold two competitions to distribute grant funding under the Greenhouse Gas Reduction Fund: a $20 billion General and Low-Income Assistance Competition and a $7 billion Solar for All Fund Competition.
RMI Summary of Greenhouse Gas Reduction Fund Programs
Under the $7 billion Solar for All Fund Competition, “EPA will award competitive grants to states, Tribes, municipalities, and eligible nonprofit entities to enable the deployment of residential rooftop solar, community solar and associated storage and upgrades in low-income and disadvantaged communities.”
State Green Banks will be eligible to apply for a portion of this $7 billion fund as “EPA expects to award up to 60 grants under this competition.” The Pennsylvania Energy Authority submitted a Solar for All application for Pennsylvania on October 6, 2023. 100% of this $7 billion in Solar for All Fund must target underserved communities.
RMI Summary of Solar for All GGRF Program
On October 12, 2023 – applications were due for two other EPA GGRF programs:
- A $6 billion Clean Communities Investment Accelerator competition will fund 2–7 hub nonprofits with the plans & capabilities to rapidly build clean financing capacity of public, quasi-public and non-profit community lenders—such as community development financial institutions (including Native CDFIs), credit unions, green banks, housing finance agencies, minority depository institutions, and others.
- Grantees will provide capitalization funding to community lenders through either (a) subgrants and/or (b) subsidies;
- Grantees will provide technical assistance subawards to build the capacity of existing community lenders; and
- Grantees will provide technical assistance services to establish new and build the capacity of existing community lenders.
- A $14 billion National Clean Investment Fund competition will fund 2–3 national nonprofits that will partner with private capital providers to deliver financing at scale to businesses, communities, community lenders, and others.
100% of the $6 billion Clean Communities Investment Accelerator funding must target underserved communities. The EPA’s Program Design for the National Clean Investment Fund competition also emphasizes that “EPA will implement these programs in alignment with President Biden’s Justice40 Initiative, which directs that 40% of the overall benefits of certain Federal investments flow to disadvantaged communities, including those facing disproportionately high and adverse health and environmental impacts.”
At an Investing in a Clean and Just Energy Future: Greenhouse Gas Reduction Fund National Convening at the National Press Club in Washington, DC on Wednesday, February 28, 2024 – several applicants for the National Clean Investment Fund competition highlighted their pledges to exceed these 40% environmental justice goals (some as high as 75%).
Greenhouse Gas Reduction Funds – Important Dates:
- October 12, 2023 – Closing Date for Solar for All Applications, National Clean Investment Fund & Clean Communities Investment Accelerator competitions.
- March 2024 – Anticipated Notification of Selections
- July 2024 – Anticipated Awards
Most IRA-related spending to date has involved private sector investments that tap into IRA tax credits, with most of the federal grant funding still on its way. With just 16% of IRA (non-tax credit) funding released as of December 2023, there is still more than sufficient time to plan for the deployment of GGRF funds as they become available in 2024-2025.
Background: DOE Loan Program Office (LPO)
The IRA funded several low interest loan programs at DOE for rapid clean energy deployment. There is no current deadline to apply. DOE’s LPO is funded through September 30, 2026.
- The IRA funded, DOE State Energy Financing Institution (SEFI) Program (Title 17, Section 1703) which supports deployment of a qualifying clean energy technology and receive meaningful financial support or credit enhancements from an entity within a state agency or financing authority.
- IRA funding/Title 17 covers a variety of finance programs – see DOE’s Loan Program Office web site.
- The IRA provided an additional $40 billion of loan authority for eligible section 1703 loan guarantees under Title 17 through September 30, 2026, and appropriated $3.6 billion in credit subsidy to support the cost of those loans;
- The IRA expanded the Title 17 Clean Energy Financing Program to include financing for projects that reinvest in energy infrastructure (Energy Infrastructure Reinvestment [EIR], section 1706), and the legislation appropriated $5 billion through September 30, 2026, to carry out EIR, with a total cap on loans of up to $250 billion;
- IRA also funded an expansion to Title 17 that allows DOE to finance non-innovative projects that receive financial support or credit enhancements from State Energy Financing Institutions (SEFIs).
The Pennsylvania Energy Development Authority is already approved by DOE to serve as State Energy Financing Institutions (SEFI). The new, “non-innovative technology” IRA definition means that PEDA could work with a Pennsylvania non-profit (or a group of non-profits) and/or a private sector third party (or both, or multiples of both) to deploy existing technologies like solar panels, electric heat pumps, and other clean technologies at low interest rates. Previous versions of the LPO program required “new, innovative technologies” (like Tesla electric vehicles in 2009).
Examples of DOE LPO funded projects appear on the LPO web site at: https://www.energy.gov/lpo/portfolio-projects
One specific example from Pennsylvania is the EOS battery storage manufacturing facility in Turtle Creek, PA – but there are numerous types of projects that the DOE LPO can finance.
Another example is the financing for energy efficiency/residential retrofits in low-to-middle-income communities. In November 2023, DOE’s LPO co-hosted a Webinar in its loan programs: NYSERDA’s State Energy Financing Fund & DOE’s Loan Programs Office: Financing Clean Energy. The Webinar described New York state programs that leverage DOE LPO financing to expand funding for residential energy efficiency retrofits in low-to-middle-income communities.
Pennsylvania Energy Development Authority contacts:
- Geoff Bristow – Acting PEDA Executive Director, gbristow@pa.gov or 814-332-6681
- Alayna Schmeider – Energy Program Specialist, aschmeider@pa.gov or 717-783-0908
DOE LPO Contact for Pennsylvania
- Tom Hucker, Senior Consultant, Loan Programs Office (LPO), U.S. Department of Energy, Mobile: 240-481-4825, Email: tom.hucker@hq.doe.gov