Here’s who wants to run the country’s $14B ‘green bank’

By Jean Chemnick | 11/06/2023 06:08 AM EST

EPA is under a time crunch to get the climate law money out the door and into the hands of nonprofit financing institutions.

Workers install solar panels on a home.

Workers install solar panels on a home in Newburgh, N.Y. Craig Ruttle/AP

Five groups are angling to lead EPA’s largest climate grant program in history, each pitching a different plan to convert billions of federal dollars into lasting change for people and the planet.

EPA has said it will only choose two or three applicants to run the National Clean Investment Fund (NCIF) — a $14 billion lending facility sometimes dubbed the national green bank. The stakes are high: NCIF is the largest program in the Greenhouse Gas Reduction Fund (GGRF), with a mission to provide affordable financing for tens of thousands of clean technology projects.

EPA is expected to announce awardees for GGRF programs — including the investment fund — by March. Totaling $27 billion, the funding aims to ensure that underserved communities reap the benefits of the green energy transition.


While the agency hasn’t provided a list of applicants, only five coalitions are seen to have launched serious bids for the investment fund: Climate United, the Justice Climate Fund, the Coalition for Green Capital, Power Forward Communities and Ecority.

They’ve spent months since EPA launched the program courting partners in communities and the environmental justice movement.

EPA asked applicants to show a ready pipeline of projects that could put Inflation Reduction Act funds to work quickly. Many project owners signed up with more than one applicant.

“I’ve talked to several folks — from developers, to community organizations, to environmental organizations — that are on multiple applications,” said Melanie Allen, co-director of the Hive Fund for Climate and Gender Justice, a foundation that mostly supports groups led by women of color and working on environmental justice issues in the U.S. South. “I think that they are almost like the stitches that are weaving these camps together.”

EPA faces a congressionally mandated sprint to get money out the door by the end of this fiscal year. The Inflation Reduction Act sets Sept. 24, 2024, as the deadline to hand over all $27 billion to state and local governments and nonprofit intermediaries — a pace that congressional Republicans argue could result in insufficient oversight.

In an email to E&E News, the agency said the applications will be reviewed by experts from EPA, as well as the departments of Energy, Treasury, Housing and Urban Development, and Labor. A panel of “senior agency officials” will then vet finalists.

Here’s what to know about the investment fund, and the groups vying to run it.

How the investment fund will work

The National Clean Investment Fund will focus on finance for smaller-scale renewable energy, as well as carbon-free buildings and transportation. EPA has also set three overarching goals: reduce greenhouse gas emissions, send benefits to underserved communities and transform financial markets in a way that will survive the program’s seven-year life span.

“Those goals don’t necessarily always align,” said Adam Kent, a senior adviser for green finance at the Natural Resources Defense Council.

An awardee might, for example, use EPA dollars to raise market-rate capital from private investment firms — expanding the pool of funds available to support projects. While that strategy has a place, Kent said relying on it too heavily could require intermediaries to charge borrowers higher rates of interest.

“The higher the cost of capital to the borrower, the less likely it’s going to work for low-income households,” Kent said. An awardee could opt instead, he said, to use more of the grant to make low- or no-interest loans to community lenders without sacrificing EPA’s goal of tapping into private capital.

None of the groups who applied for the NCIF funding have made their applications public, though EPA allows them to. Some have said they will.

But experts familiar with multiple applications say they differ not only in strategy and experience but in the specificity of their plans.

Dale Bryk, director of state and regional policies at the Harvard Environmental and Energy Law Program, said some applicants put forward detailed environmental performance standards to ensure their lending would target zero-carbon building and transportation projects, as EPA intends. Others did not.

“I’m hopeful that EPA will have enough bandwidth to really kick the tires on these and suss out and validate what’s in there,” she said.

Climate United

Climate United is a partnership of three well-established nonprofit finance institutions: global impact investment firm Calvert Impact; the Community Preservation Corp., which finances multifamily affordable housing; and Self-Help, a community development financial institution (CDFI).

Climate United applied for a grant up to the full $14 billion offered under the NCIF program.

“We know that if you really want to decarbonize buildings at scale — and quickly — you have to change the behavior in the mortgage markets,” said Beth Bafford, the initiative’s CEO, and a Calvert Impact vice president. “If you don’t incorporate deep decarbonization investments through that process, we are never going to get to decarbonization at the scale that we need to actually make a dent in our emissions that come from buildings.”

The partnership proposes to use the Inflation Reduction Act funds to offer homebuyers a second loan at no additional monthly cost when they take out a mortgage. That loan would cover the upfront cost of carbon-saving investments like efficient appliances, electric heat pumps and vehicle-charging infrastructure.

Justice Climate Fund

The Justice Climate Fund was launched by the Community Builders of Color Coalition and claims support from more than 1,000 community development financial institutions — a Treasury Department designation for nonprofit finance entities that focus mostly on low-income communities.

CDFIs have been around for decades in every state and had more than $450 billion in assets in the first quarter of this year. They work overwhelmingly in the kinds of low-income communities EPA hopes to target, and they already finance most affordable housing, said Douglass Sims, JCF’s interim CEO.

“You don’t have to build anything new,” said Sims. But with “the right kind of capital, the right kind of collaboration and training,” CDFIs can become catalysts for green lending that centers the needs of underserved communities.

JCF applied for $12 billion under the investment fund and an additional $4.4 billion under the GGRF low-income lender program dubbed the Clean Communities Investment Accelerator.

Coalition for Green Capital

The Coalition for Green Capital (CGC) lobbied Congress for years to pass legislation creating a national green bank. CGC applied for $10 billion from NCIF.

Eli Hopson, the group’s chief operating officer and executive director, said the goal is to establish “a self-sustaining financial institution in every state that is providing sustainable finance.”

Green banks have tended in the past to specialize on large-scale renewable energy projects, though there have been exceptions. Hopson led the D.C. Green Bank before joining CGC, which focused on community projects.

But utility-scale projects now have little difficulty securing commercial financing, Hopson said.

“The goal for the Green Bank is that you demonstrate success of a type of project in a community, and you show that it can make money, and the private sector takes it over over time,” Hopson said. “And then the green bank moves on to the next type of sustainable finance that needs that kind of support.”

CGC has added two high-profile, former White House officials to its board this year: Cecilia Martinez is the former environmental justice lead at the White House Council on Environmental Quality, and David Hayes was a climate aide to President Joe Biden.

Former White House climate adviser Carol Browner is also an adviser to the group.

Power Forward Communities

Electrification nonprofit Rewiring America and Enterprise Community Partners — a community development financial institution — are the driving forces behind Power Forward Communities.

The group also includes community development nonprofit Local Initiatives Support Corp. and the charities United Way and Habitat for Humanity International. It has asked EPA for $9.5 billion from NCIF.

“We will not meet our climate goals — and we will certainly not meet our equity goals — if we do not focus on housing and on low-income neighborhoods,” said Shaun Donovan, CEO of Enterprise Community Partners and former President Barack Obama’s first secretary of Housing and Urban Development.

Power Forward Communities said it could offer financial products that would help maximize the impact of the Inflation Reduction Act dollars. It is also working on education tools — like software that will let consumers see at a glance what federal and state incentives are available.

The partnership says it can galvanize enough consumer interest to buy energy-saving products “in bulk,” lowering their upfront costs. Donovan and Rewiring America CEO Ari Matusiak said they have secured “letters of commitment” from manufacturers like Carrier and Mitsubishi.


Ecority aims to tap into capital from credit unions, not Wall Street. The nonprofit applied for $10.87 billion in NCIF funds and $4 billion from GGRF’s Clean Communities Investment Accelerator.

“The money that’s been entrusted by the members of credit unions in their deposits represents the most affordable, the lowest-cost private capital available in America,” said board member Robbie Vitrano.

More than half of the credit union industry already serves low-income communities and customers, Vitrano noted. And they hold $2 trillion in assets.

Ecority proposes to use the EPA grant to create loan guarantees for nonprofit lenders. Those lenders could then offer low-cost loans to help households and businesses cut carbon — a scheme Vitrano said could leverage between $10 and $30 in private dollars for every public dollar spent.

Clarification: The article as originally published misstated the level of agreement between Power Forward Communities and companies on discounts.