The U.S. government, led by President Biden, disclosed details on Tuesday of how states and non-profit entities can seek access to the $27 billion in funding from a "green bank". This financing is meant to be low-cost and will be used for initiatives aiming to diminish the amount of emissions that contribute to global warming.
The Greenhouse Gas Reduction Fund, which was established by Congress as part of the significant climate law that was ratified in 2020, will be used to fund green energy initiatives across the country, with an emphasis on those in deprived and underprivileged areas.
The EPA is projected to give away $20 billion in grants to up to 15 non-profit organizations. These groups will collaborate with local banks and other financial entities in order to back initiatives that minimize pollution and diminish energy costs for households.
Funding of $7 billion will be given to states, native tribes and local governments to finance various solar energy initiatives, such as solar installations for homes, community solar projects and energy storage technologies utilizing the sun's energy.
Michael Regan, the Administrator for the Environmental Protection Agency, has declared that the green bank -- which has already been set up in states such as New York, Connecticut and California -- will enable neighborhoods and communities to have access to billions of dollars of private investment to get involved in the clean-energy economy and create green jobs.
Regan, the first African American to lead the Environmental Protection Agency (EPA), remarked that those from low-income and disadvantaged backgrounds, who dedicate the most of their earnings to energy costs, have not seen private investors step in to create opportunities for them. He explained that this is due to a variety of reasons.
The focus here is to ensure that the $27 billion chance is considered in a way that permits the local community to be included. If this had been done in the past, there would be no need for the Greenhouse Gas Reduction Fund. We are tasked with drawing private capital out of the sidelines.
Nearly 400 people have already replied to the initial queries regarding the program, according to Jahi Wise, who is the acting director of the program. Grant awards are anticipated to start this summer.
Congressional Republicans have already labeled the green bank as a "slush fund" that could potentially be exploited by taxpayers' money, even prior to the grant being granted.
Congressman Gary Palmer (R-Ala.) has declared that he will introduce legislation to abolish the fund, which he declared would be advantageous to Wall Street businesses but "would not assist the American people with their energy bills."
Palmer inquired if the $27 billion reserve would reduce the cost of heating for American households.
In his statement, Sean Kelly, a spokesperson for House Energy and Commerce Chair Cathy McMorris Rodgers, R-Wash., highlighted that the fund provides a plentiful amount of power and resources to the EPA, yet does not have a method to make sure there is oversight or visibility into how these resources are utilized.
Kelly expressed in a statement that this provision constructs a taxpayer-funded reserve for Wall Street and could lead to wasteful spending, cheating, and misuse. He added that this is not a reliable way to allocate these funds.
Optimism was much more rampant among the Democrats, who saw the fund as a chance to make history by reducing emissions of greenhouse gases, bettering public health, and providing economic opportunities for those in disadvantaged and deprived areas.
Sen. Chris Van Hollen of Maryland, Sen. Ed Markey of Massachusetts and other Democrats have labored tirelessly to make the concept of a nationwide climate bank a reality, and the EPA's recent action brings them a step closer to achieving their goal.
Markey and Van Hollen declared in a joint statement that they would collaborate with the EPA to make certain that the new fund has a nationwide range, produces a substantial "multiplier effect" with private capital and includes a range of participants, including "communities that have been traditionally neglected" by banks and other financial institutions.