U.S. Environmental Protection Agency
Environmental Financial Advisory Board
Public Meeting Minutes
December 15, 2022
Virtual
Respectfully submitted by Edward H. Chu, EPA Designated Federal Officer
Certified as accurate by Kerry E. O'Neill, Chair, Environmental Financial Advisory Board
NOTE AND DISCLAIMER: The minutes that follow reflect a summary of remarks and conversation during the meeting.
Such ideas, suggestions, and deliberations do not necessarily reflect consensus advice from the Board. Formal advice
and recommendations may be found in the final advisory reports or letters prepared and transmitted to the agency
following the public meetings. Moreover, the Board advises that additional information sources be consulted in
cases where any concern may exist about statistics, or any other information contained within the minutes.
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Contents
Purpose 1
Welcome, Review of Agenda, and Client Office Remarks 2
Objectives Workgroup 3
Program Structure Workgroup 4
Execution, Reporting, and Accounting Workgroup 5
Board Discussion and Vote 7
Recap, Wrap-Up, and Client Remarks 9
Adjourn 9
Appendix 1. Federal Register Announcement 10
Appendix 2. Agenda 12
Appendix 3. EFAB Members 13
Appendix 4. Slide Presentations 18
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 1
Purpose
The U.S. Environmental Protection Agency (EPA) Financial Advisory Board (EFAB or Board) is an advisory
committee chartered under the Federal Advisory Committee Act (FACA) to provide advice and
recommendations to EPA on creative approaches to funding environmental programs, projects, and
activities. The purpose of the meeting was to discuss the Greenhouse Gas Reduction Fund charge.
The meeting was announced in the Federal Register (see appendix 1).
Please see appendix 2 for the agenda and appendix 3 for EFAB member names and affiliations.
Workgroup presentations are in appendix 4.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 2
Welcome, Review of Agenda, and Client Office Remarks
Edward H. Chu I EFAB Designated Federal Officer
Kerry O'Neill I EFAB Chair
Alejandra Nunez I EPA Charge Client
Tim Profeta I EPA Charge Client
Welcome
Ed Chu opened the meeting and shared that, as an advisory committee chartered under the FACA,
meetings are open to the public. He invited the public to submit written comments.
Kerry O'Neill conducted the roll call.
Kerry O'Neill said that this is the final meeting related to the Greenhouse Gas Reduction Fund (GHGRF)
charge. She said after the workgroups make their presentations, there will be a Board discussion.
Ed Chu thanked members and acknowledged the many hours that workgroup members have
volunteered in just a few weeks. He gave some background on the GHGRF and the workgroups,
emphasizing that EPA used a three-pronged approach to engage stakeholders on the GHGRF: (1) the
EFAB; (2) public listening sessions; and (3) a Request for Information.
Ed Chu reminded attendees that the workgroups have been working on providing options for EPA,
rather than the typical recommendations, and the purpose of the current meeting was to approve the
finalized options presentation and creation of a transmittal letter summarizing the work on the GHGRF
charge.
Attendance
Ashley Allen Jones, present
Courtney L. Black, present
Steven J. Bonafonte, present
Angela Montoya Bricmont, present
Matthew T. Brown, present
Stacy Brown, not present
Theodore Chapman, present
Albert Cho, present
Janet Clements, present
Lori Collins, present
Zachary Davidson, present
Jeffrey R. Diehl, present
Sonja B. Favors, not present
Phyllis R. Garcia, present
Eric Hangen, present
Edward Henifin, not present
Barry Hersh, present
Craig Holland, present
Craig A. Hrinkevich, present
Margot Kane, present
Thomas Karol, not present
George W. Kelly, present
Gwendolyn Keyes Fleming, not present
Cynthia Koehler, present
Colleen Kokas, not present
Joanne V. Landau, present
Lawrence Lujan, present
MaryAnna H. Peavey, present
Dennis A. Randolph, present
Eric Rothstein, not present
Sanjiv Sinha, not present
William Stannard, present
Marilyn Waite, present
David L. Wegner, present
Gwen Yamamoto Lau, present
David Zimmer, present
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 3
Kerry O'Neill said EPA deliverables include the slide deck shared today (see appendix 4), a transmittal
letter, and the public comments. She thanked the public for being deeply engaged with EFAB. She said
the Board has done an impressive amount of work in a short time.
Objectives Workgroup
Cynthia Koehlerand Margot Kane I Workgroup Co-chairs
Angela Bricmont I Workgroup member
Cynthia Koehler reviewed the focus of the Objectives workgroup; specifically, the workgroup was asked
to provide considerations around GHGRF objectives, including funding and financing for projects to
reduce greenhouse gas emissions that are not being well resourced today, particularly for low-income
and historically disadvantaged communities; efficiency; and environmental justice considerations. She
noted challenges to achieving GHGRF objectives, including lack of capital and lack of capacity in low- and
moderate-income communities to apply for funds, among others.
Cynthia Koehler highlighted the workgroup's four overarching principles for EPA, which are to (1)
balance equity and access objectives with leverage objectives; (2) balance need for "shovel-ready"
projects with capacity-building goals; (3) acknowledge a variety of mandates and objectives in the short-
term; and (4) ensure eligible recipients are positioned to serve priority communities effectively.
Margot Kane noted that most of the tensions exist in the short term; in the long term, most objectives
are mutually reinforcing, suggesting that EPA balance short-term and long-term trade-offs. One
possibility is for GHGRF funding streams to be weighted. She shared a table illustrating how the
weighting of design elements could vary according to the recipient. She also shared the workgroup's
assessment of the strengths and weaknesses of each design element and which kind of recipient would
be a strong or weak fit. Design elements were (1) leverage; (2) short-term capacity building; (3) capital
recycling; (4) additionally; and (5) long-term sustainability reporting.
Margot Kane said the group was also asked to identify programs and structures within public sector
funding that could complement the GHGRF. She said the list was long, so instead of simply producing a
list, the workgroup developed principles for EPA to consider when leveraging support. The workgroup
identified several such principles, including using Justice40 not as a maximum but as a minimum starting
point for the entire program.
Angela Bricmont shared the workgroup's thoughts on how EPA could define low-income and
disadvantaged communities. Here, too, the workgroup provided EPA with guiding principles. Angela
Bricmont emphasized setting clear expectations, acknowledging that no single definition will meet the
need of every community, and looking beyond median income to define "disadvantaged community".
Ultimately, she said, the workgroup suggests an inclusive model that allows overlays to be added to
ensure inclusive and equitable access to greenhouse gas and pollution reduction benefits.
Regarding the charge on the kinds of technical assistance (TA) GHGRF recipients should provide to
ensure that low-income and disadvantaged communities are able to benefit from the funding, Cynthia
Koehler said the workgroup's guiding principles were that TA will vary depending on the types of
applicants and on the project goals in addition to reductions. She said there are a huge number and
variety of TA that EPA could consider. For example, in addition to identifying funding opportunities and
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 4
synergies, she said that there is a real need for communities to see case studies because it is not always
clear what will or will not get funded.
Regarding advice on financial assistance that EPA could consider for grant recipients, Cynthia Koehler
shared some of the workgroup's suggested strategies such as developing flexible or forgivable lending
structures designed with low cash-flow households in mind, establishing nontraditional methods of loan
repayment such as pay-as-you-save, and adopting policies that facilitate the flow of funds toward low-
income households within the larger program. She shared a public comment about one such creative
example: Maryland's solar program required 30 percent of its solar capacity to be reserved for projects
serving low- and moderate-income households. For investors and developers, the state guaranteed to
cover to any losses from nonpayment of bills. In exchange, developers had to agree to a 20 percent
discount on low-income subscribers' electricity bills.
Given the speed at which these funds must be disbursed, Cynthia Koehler said, partners selected for
assistance should already have services and products intentionally designed to overcome barriers to
capital among low-income and disadvantaged communities, such as mission-driven lenders and those
who use alternative underwriting criteria. The workgroup also thought it would be useful to consider the
value of indirect financial assistance, and for EPA to consult with organizations that specialize in
protecting low-income housing from predatory lending programs.
Regarding indicators of success, Cynthia Koehler said the third workgroup would focus more on this, but
in addition to indicators on greenhouse gas reduction measures, her workgroup suggested focusing on
impacts in low-income and disadvantaged communities, such as energy cost reductions for households,
better walkability scores, and workforce initiatives. Success could also be measured in the area of
program efficiency and performance, such as by looking at deployment and reach, leverage, and others.
Program Structure Workgroup
Lori Collins and Ashley Allen Jones I Workgroup Co-chairs
Lori Collins explained that the workgroup was asked to provide considerations for the GHGRF program
structure, including eligible recipients, eligible projects, and funding structure. She said to approach the
charge, workgroup members drew on their own expertise as well as on interviews with members of the
EFAB and third-party experts in relevant sectors. She said they also reviewed public comments, which
the workgroup found helpful.
Lori Collins reported that the workgroup identified numerous eligible recipients, including green banks,
community development financial institutions, nonprofit social impact funds, minority depository
institutions, and several others. The workgroup depicted strategic allocation of capital along the value
chain of activities, from subgrants, to pipeline development through operations and maintenance. In
addition, they looked at different types of capital and sought to identify suitable grant recipients for
various types along the spectrum. The workgroup also explored which type of eligible recipients would
best ensure that funds reached disadvantaged communities. They identified two potential mechanisms:
special purpose credit programs (SPCPs) and minority deposit institutions (MDIs). She said there are a lot
of institutions already established and embedded in low-income communities; these can be leveraged
to prioritize decarbonization strategies. She noted that a sizeable amount of assets is already mission
driven.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 5
The workgroup looked at the major sectors of greenhouse gas emissions: agriculture, transportation,
industry, and residential/commercial. Challenges in housing could be addressed with eligible programs
such as weatherization, rooftop solar, heat pumps, and so on. Solutions in the transportation sector
could include support for electric vehicles, bicycles, fleet conversion, and more. The workgroup also
mapped out who would benefit from solving each problem in particular ways. They looked at the
potential role of TA along the value chain and noted a potential to ask organizations to collaborate to
form "clean energy hubs" to exploit synergies across the value chain.
Lori Collins said the workgroup also listed barriers to private capital at the project level, borrower level,
and capital provider level and identified how GHGRF initiatives could potentially address various
barriers. As an example, she mentioned the challenge of uptake for home improvements, even in
programs with zero percent interest loans, and suggested that one strategy for addressing this challenge
could be a community-wide program.
The workgroup also looked at the structure of funding, identifying six approaches. Lender intermediaries
was a new addition to these approaches since they shared their work at the last public meeting. From
one or more of these recipients, funds would flow to beneficiaries, and then to projects along the value
chain, from pipeline development to project operations and maintenance. Pipeline and project
development phases would address social, economic, and financial gaps with GHGRF funding and TA,
whereas project implementation and operations and maintenance (O&M) would require capital
commitments.
The workgroup listed strengths and weaknesses of each of the six funding strategies previously
identified. With the first strategy (States, Municipalities, and Tribes), some of the strengths are equitable
access and an existing infrastructure that can be leveraged. This is in stark contrast to the second
strategy, a national green bank, which would require significant lead time just to get a structure in place.
A national green bank has strengths, though, such as reduced administrative burden to EPA and an
ability to administer a "race to the top" strategy via interstate competition over time. The workgroup
itemized the strategy, applicant requirements, EPA methodology, and strength and weaknesses of each
of the six approaches (these can be viewed in the workgroup's presentation in appendix 4).
Execution, Reporting, and Accounting Workgroup
Ted Chapman and MaryAnna Peavey I Workgroup Co-chairs
Gwen Yamamoto Lau said this workgroup was assigned to imagine possibilities and provide insights into
how amazing the program could be, as well as to evaluate the types of metrics that EPA might adapt to
ensure GHGRF monies are used as intended. She reminded listeners that EPA has a very short window in
which to implement the new $27 billion program.
Gwen Yamamoto Lau said the short-term focus for the program is issuing a Notice of Funding
Opportunity (NOFO), and the most important consideration for EPA during this period is making sure
that appropriated funds are awarded and obligated by the September 30, 2024, funding expiration date.
She said, similarly, long-term considerations for EPA are to ensure the timely deployment of funds to
reduce greenhouse gas emissions and achieve other goals and to ensure that the funds are being used
as intended.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 6
For the $7 billion bucket to states, tribes, and municipalities, the workgroup identified considerations for
EPA's rapid deployment phase, which includes prioritizing applications for finance authorities with
existing clean energy and other greenhouse gas reduction financing programs or for states with enabling
legislation to create a financing authority focused on greenhouse gas reduction. She said EPA may want
to consider creating a separate funding bucket for tribes.
For the $12 billion funding bucket, Gwen Yamamoto Lau said the priorities are delivering financial
assistance nationwide on a variety of levels in a sustainable manner. The workgroup made numerous
suggestions for assigning extra points to applicants, such as for tapping existing networks of
subrecipients across the country and for having a track record of deploying funds nationwide. She noted
that, as with the $8 billion bucket, the $12 billion bucket includes funds and TA to establish new public
and/or nonprofit lenders to scale green lending across the country.
Gwen Yamamoto Lau reported the workgroup's suggestion that applications for the $7 billion pot be
reviewed and scored by a committee, and that EPA could consider accepting applications on a rolling
basis until September 1, 2024. Any remaining funds could be obligated until September 30, 2024, to an
eligible entity capable of making competitive subawards.
Gwen Yamamoto Lau noted that the 20-month timeframe to obligate funds heightens the need to
ensure rigorous terms in the initial stages. The workgroup suggested that EPA may also want to consider
incorporating a mechanism that triggers underperforming eligible recipients to transfer a portion of
funds to high-performing eligible recipients in need of additional greenhouse gas reduction funds. Such
a process could enable the redeployment of funds after the September 2024 deadline while maximizing
greenhouse gas reduction. She suggested that EPA may want to refer to lessons learned from other
federal programs to reduce obstacles to reaching disadvantaged communities, such as the Clean Water
State Revolving Fund (SRF) Section 319 exemptions.
Gwen Yamamoto Lau also shared the workgroup's thoughts on establishing metrics for successes, such
as measuring greenhouse gas emission reductions in disadvantaged communities, as well as leverage
achieved, and a self-sufficiency ratio, among others. To facilitate rapid deployment, EPA could track
funds awarded compared with funds expended. Economic development indicators may also be of
interest to EPA as they administer this program.
Workgroup member Eric Hangen discussed concerns that EPA may want to think about in each of the
three funding buckets. For the $7 billion bucket, he raised the concern of timely deployment of funding
to low- and moderate-income and disadvantaged communities. He emphasized the need to ensure that
projects are not merely located in disadvantaged communities, but that those communities see the
benefits of the projects. He added that the transformative application of funding is important for EPA to
track, and that some of the best ways to achieve additionality and impact is by focusing on the low-
income and disadvantaged communities that have previously been locked out of getting these types of
investment.
Eric Hangen said concerns for the $12 billion bucket also include timely deployment, as well as recipients
having a track record and the clean energy expertise necessary to deploy funds. Other concerns are how
these institutions are leveraging other capital and ensuring their ongoing operability as an institution. In
other words, the workgroup is asking EPA to consider the sustained transformation of institutions so
that they become a force for decarbonization.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 7
In the $8 billion bucket, Eric Hangen pointed out concerns that are similar to the other two funding
buckets, such as the timely deployment of funds. He also highlighted the need for recipient entity
accountability to low-income and disadvantaged communities, which may include how communities are
represented on boards or other bodies. He also pointed out a concern for having a track record of
developing long-term, trusted relationships in low-income and disadvantaged communities.
Eric Hangen shared the workgroup's thoughts on tools that EPA could use to promote GHGRF objectives.
For example, tools for accountability include guardrails that EPA embeds in the application process, as
well as federal requirements, governance, reporting/metrics, and claw back/redistribution strategies. He
highlighted that, for the metrics strategy, EPA may want to think about tools or support they can
provide direct and indirect recipients to make it easier to track and report greenhouse gas abatement.
He emphasized that some initiatives may not see greenhouse gas reductions immediately, but over
time, they would generate more benefits than would be realized by supporting a shovel-ready project.
He mentioned solar development as one example.
Another aspiration of the GHGRF is accountability to low-income and disadvantaged communities.
Among other considerations for this aspiration, Eric Hangen said EPA may want to ask for demonstrated
community partnerships. With the leverage aspiration, he said EPA may want to ensure the financial and
technical expertise of recipient entities. Among several other considerations, he iterated a point made
by other workgroups, which is that EPA may want to think about in which cases asking for leverage
makes sense and in which cases it may not. On the additionality aspiration, he pointed out the difficulty
of getting direct confirmation, so the workgroup suggested that EPA may want to focus on embedded
application guardrails as a way to ensure additionality. The workgroup also supplied several
considerations for the continued operability element, particularly organizational level metrics.
Board Discussion and Vote
Kerry O'Neill I EFAB Chair
Ed Chu said the first decision point is to approve the workgroup materials, and the second is to agree to
Kerry O'Neill and the workgroup co-chairs drafting a transmittal letter that summarizes the workgroup
reports. The Board would have an opportunity to approve the letter by email.
George Kelly said the law had components dealing with greenhouse gas reduction and also with zero-
emission technologies, and he asked if any of the workgroups had discussed that component. Eric
Hangen replied that it was an interesting question from the point of view of leverage metrics. For
example, providing rooftop solar to low-income homeowners in lieu of a tax credit, or using leasing or
power purchase agreements (PPAs), which would have high leverage. Margot Kane said that Workgroup
1 discussed the issue and, based on client feedback, decided to focus on the funding pathways versus
the specific technologies. She said EPA has substantial in-house expertise in zero-emission technologies.
Ashley Allen Jones said that Workgroup 2 was also advised that energy infrastructure was not EPA's
urgent priority.
Bill Stannard suggested that the slide on eligible projects that referenced water utilities could clarify that
it includes utility wastewater treatment processes, as well as drinking water utilities, as there are many
opportunities for reducing energy consumption and greenhouse gas production in wastewater
treatment processes. Dave Wegner added that, in the Objectives Workgroup, they also discussed water
as it relates to agriculture.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 8
Barry Hersh said that the discussion on the importance for organizations to have lending experience was
good, and that in his experience, the organization has to understand risk management.
Kerry O'Neill asked if the Board would like to vote on accepting the materials as presented, with the
clarification suggested by Bill Stannard.
Albert Cho asked whether the infrastructure equipment upgrade piece would include installing software
or controls to optimize infrastructure systems to reduce greenhouse gases. Lori Collins said she believes
the answer is yes, but that level of detail was not included.
Jeff Diehl made a motion to accept the materials with the discussed clarification. Lori Collins seconded.
Kerry O'Neill conducted a roll call vote. All present members voted in favor.
Kerry O'Neill said next steps will be to adjust the slides to reflect the expanded language and collect the
public comments as a part of the deliverables along with the transmittal letter.
Ed Chu said the transmittal letter would summarize or highlight the workgroup reports and asked if
there were other issues or recommendations that emerged from the workgroups that members may
want to include in the letter. Kerry O'Neill suggested reminding EPA that the EFAB is a volunteer board
that was working under a very compressed timeline and in an atypical way. She said the letter might
include that the product is not meant to be comprehensive and that the Board's expertise is not in
interpreting legislation. She noted that some workgroup members would like to highlight the
competitive element of grants. In addition, the letter might highlight the balancing act required to
achieve GHGRF goals. She said another discussion point was whether the EFAB wanted to recommend
ongoing budget allocation. The GHGRF is currently a one-time allocation.
Lori Collins asked if the Board wanted to mention claw back. Kerry O'Neill said she felt that issue had
been dealt with in the version just presented.
Ashley Allen Jones mentioned EPA integrating with other programs.
Ed Chu noted that it is new to EPA to have intermediaries handling a large amount of money. He asked if
the Board would want to recommend minimum thresholds or terms and conditions regarding indirect
recipients to ensure results are similar to what EPA could expect if there weren't an intermediary.
Jeff Diehl said EPA already does that in a way though the SRF program. He said with regards to receiving
money from a national green bank to invest in projects, they would be providing the same information
to EPA but through a national green bank. Eric Hangen and Marilyn Waite concurred. Marilyn Waite
gave an example of the Partnership for Carbon Accounting Financials (PCAF). Eric Hangen said it's
important to have tools and clear methodologies to get good estimates. Dave Zimmer noted that a
benefit of using intermediaries is not only that funding gets out quickly, but also that recipients don't
have to worry about a federal agency claw back after the project is finished. Marilyn Waite clarified that
the PCAF gets more granular as better datasets come online and more asset classes are developed. She
suggested EPA may benefit from meeting with PCAF to see what already exists.
Kerry O'Neill asked for a motion to have a transmittal letter drafted by Kerry O'Neill and the workgroup
co-chairs and then sent to the Board via email. Cynthia Koehler so moved, and Joanne Landau seconded.
Kerry O'Neill took another roll call vote; the motion passed.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 9
Recap, Wrap-Up, and Client Remarks
Ed Chu I EPA Designated Federal Officer
Kerry O'Neill I EFAB Chair
Alejandra Nunez thanked the Board and workgroups for their work over the last two months and said
they have been a pleasure to work with. Tim Profeta thanked the EFAB for their work and said his EPA
colleagues will have a good roadmap for balancing the GHGRF's various goals.
Kerry O'Neill said Alejandra Nunez and Timothy Profeta have been amazing partners. She said she is
proud to be a part of the hardworking Board. She said they represent the best of public service. She also
recognized the work of Ed Chu, Tara Johnson, and other support staff.
Ed Chu said the EFAB has accomplished a great deal, and he is looking ahead. He pointed to the multi-
year charge that's on the table and said that Kerry O'Neill has received feedback on recommendations to
EPA. At the next meeting, former clients will give updates on what was done with recommendations. He
thanked them for their public service to EPA and taxpayers.
Ed Chu said he will send out a notice about the next meeting, which will be an in-person meeting.
Adjourn
Ed Chu adjourned the meeting.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 10
Appendix 1. Federal Register Announcement
'9
Federal Register/Vol. 87, No. "211 /Wednesday, November 2, 2022/Notices 66175
Polic\ Statement FERC-552 remains
th^ sdme and no changes are needed for
that collection.
the Commission.
Issued: October 27, 2022.
KimberlvD. Bose,
Secretary.
[FR Doc. 2022-23846 Filed 11-1-22; 8:45 am]
BILLING CODE 6717-01-P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
Combined Notice of Filings
Take notice that the Commission has
received the following Natural Gas
Pipeline Rate and Refund Report filings:
Filings Instituting Proceedings
Docket Kumbeis RP23-77-000
Applicants: ANR Pipeline Company.
Description: §4(d) Rate Filing:
Jackson Generation #1321201 NCNR to
be elective 11/1/2022.
Filed Date: lo/2b/22.
Accession Number: 2022102652U3.
Comment Date: 5 p.m. hi 11/7/22.
Docket Numbers: RP23-78-000.
Applicants: Algonquin Gas
Transmission. LLC.
Description: % 4(d) Rate Filing:
Negotiated RatesAmended Excelerate
510850 ett 11-01-22 to be effective 11/
1/2022.
Filed Date lo/^R/22
Accession Numbti 20221026-5215.
Comment Date 5 p m. ET 11/7/22.
Docket Nnmbei s RP23-7M-000.
Applicant* Tidnscontin^ntal Gas
Pipt Line Company TIC
Descnption Compliance filing:
Annual Penalty Re\ pnue Sharing Report
2022 to bp effective N/A.
Filed Date: 10/27/22.
Accession Number: 20221027-5020.
Comment Date: 5 p.m. ET 11/8/22.
Docket Numbers: RP23-8G-000.
Applicants: Destin Pipeline Company.
L.L.C.
Description: Compliance tiling: Destin
Pipeline Annual Fuel Retention
Adjustment to be eiiective N/A.
Filed Date: 10/27/22.
Accession Number: 20221027-5037.
CouumntDate 5pm ET 11/8/22
Docket Numbers: RP23-81-000.
Applicants: Carolina Gas
Transmission. LLC.
Description: §4(dj Rate Filing: CGT
October 27. 2022 Administrative Change
to be effective 12/1/2022.
Filed Date 10/27/22
Accession Numbei 202210275043.
Comment Date: 5 p.m. ET 11/8/22.
Any person desiring to intervene or
piotesl m an^ ol the abo\e pioGH?dmgt>
must hie m accordance with Rules 211
and 214 ot the Commission s
Regulations (18 CFR 385.211 and
385 214) on in b( ton 5 00 p m Eastern
time on the specified comment datt
Protests may be considered, but
intervention is necessary to become a
party to the proceeding.
The filings are accessible in the
Commission's eLibrary system (https://
elibrary.ferc.gov/i dm ws/search/
fercgensearch.asp) by querying the
docket number.
eFiling is encouraged. More detailed
information relating to tiling
requirements mtenentions piottsts
service, and qualifying facilities tilings
can be found at: http //intu feic go1;/
do cs-filing/efiling/film %-req.pdf. Fo r
other information, call (86b) 208-3b7b
(toll free). For TTY, call (202) 5028b5y.
Dated: October 27, 2022.
Debbie-Anne A. Reese,
Deputy Secretary.
[FR Doc. 2022-23841 Filed 11-1-22; 8:45 am]
BILLING CODE 6717-01-P
ENVIRONMENTAL PROTECTION
AGENCY
[FRL-10382-01 -OWj
Notice of Public Environmental
Financial Advisory Board Virtual
Meetings
AGENCY: Environmental Protection
Agency (EPA).
ACTION: Notice of public meetings.
SUMMARY: The United States
Environmental Protection Agency I,EPA)
announces three public meetings of the
Environmental Financial Advisory
Board ^EFAB). The meetings will be
conducted in a virtual format via
webcast The puipose otthe met lings
will be tor the EFAB to provide
woikgioup updates and ^oik pioducts
fni the Greenhouse Gas Reduction Fund
charge. Written public comments may
be provided m advance. No oral public
comments will be accepted during the
meetings. Please see the SUPPLEMENTARY
INFORMATION section tor further details.
DATES: The meetings will be held on:
1. November 17, 2022, from 1 p.m. to
3 p.m. Eastern Time:
2. December 1. 2022, from '1 p.m. to
3 p.m. Eastern Time' and
3. December 15. 2022. from 1 p.m. to
5 p.m. Fdstein Time
ADDRESSES: The meetings will be
conducted in a virtual, format via
webcast only. Information to access the
webcast will be provided upon
registration in advance ot each meeting.
FOR FURTHER INFORMATION CONTACT: Any
member ot the public who wants
information about the meetings may
contact Taia Johnson \id telephone/
\ oitenidil dt (202) 5646186 ui enidil to
vfab^rpa go\ Geneial liifomidtion
concerning the EFAB is available at
h Up s://www. ep a. go vl
waterfmancecenter/efab,
SUPPLEMENTARY INFORMATION:
Background: The EFAB is an EPA
achison committee chaiten dund^rthe
Fed* idl Adt isoiv Committee Act
(FACA) 5t'SC App I to pro\ult
ad\ice and lecommendations to EPA on
innovative approaches to funding
environmental programs, projects, and
activities. Administrative support for
the EFAB is provided by the Water
Infrastructure and Resiliency Finance
Center within EPA s Qthce ot Water.
Pursuant to FACA and EPA policy,
m ttice is hereby gn en that the EFAB
will hold thiee public mnptmgs via
webcast foi the following pinpose:
Pini ide workgroup updates and work
products foi the Bodid s Greenhouse
Gas Reduction Fund charge.
Registration for the Meeting: To
register for the meeting, please visit
https //mni' epa goi /\\atei finance
tentei/e1ab#meetmg Inteiested peisons
who wish to attend the meeting via
webcast must legists b\ Noi embei 14,
2022 (tor the November 17. 2022.
meeting). November 28, 2022 (tor the
December 1. 2022. meeting), and
December 12 2022 (foi the Di cembor
15 2022 meeting) Pie-iegistiation is
strongly encouraged.
ailahihti of Meeting Matenals
Meeting materials, including the
meeting agenda and briefing materials,
will be available on EPA s website at
https://www.epa.gov/
u 'iteifinanc er entei/^fab
Procedures for Providing Public Input:
Public comment tor consideration by
EPA s federal ddi l ui\ committer has a
ditteient puipo e from public comment
prm ided to FPA piogiam office
Therefore thnpmces foi submitting
comments to a federal advisory
committee is different from the process
used to submit comments to an EPA
program office. Federal advisory
committees provide independent advice
to EPA. Members of the public may
submit comments on matters being
considered by the EFAB tor
consideration as the Board develops its
advice and recomnif ndations to EPA.
Written Statements Wntt^n
statements should be ircen od by
November 10, 2022 [torthp November
17, 2022, meeting), November 25, 2022
-------
Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 11
66176 Federal Register/Vol. 87, No. 211/Wednesday, November 2, 2022/Notices
(for the December 1. 2U22. meeting), and
December 8. 2022 (tor the December 15,
21)22 meeting) bo that the inioimation
can be made available to the Lfc AB toi
its consideiation pnoi to the meeting
WiiLU'ii sUiLomontb bliouhi be bent \ia
email to vUib(t<>pa qoi Vlemheib otthe
public should bo nwaii that their
peisonal contact mf>nmat]>m if
included in an}' written comments, ma}?
be posted to the EFAB website.
Copyrighted material will not be posted
without explicit permission of the
copyright holder.
Accessibility: For information on
access or services for individuals with
disabilities or to request
accommodations for a disability, please
register for the meeting and list any
special requirements or
accommodations needed on the
registration form at least 10 business
days prior to the meeting to allow as
much time as possible to process your
request.
Andrew D, Sawyers,
Dm tor ce of Wastewater Management,
Offn t of It Ul T,
[FR Dot 23796 Filed 11122; 8:45 am]
BILLING CODE 65S0-50-P
ENVIRONMENTAL PROTECTION
AGENCY
[EPA-HQ-OPPT-2022-0835; FRL-10293-
01]
Webinar and Opportunity To Submit
Applications for the Assessment of
Environmental Performance Standards
and Ecolabels for Potential Inclusion In
EPA's Recommendations for Federal
Purchasing
AGENCY: Environmental Protection
Agency (EPA).
ACTION; Notice.
assessments against Sections I through
IV otthe tramewoiktoi the Assessment
oi Em noiimenldl Peifoimaiice
Standaids and Ecolabels ioi federal
Purchasing (trame"u oik! 1 he number of
full a t smentb that EPA can perform
will depend on thr numbei of
applicant n> ul This notice mav be of specific
inteii st to pt isons who inpu s.-nt
standaids development oigdmVations,
ecoldbt-1 piograms and associated
s. ontoimiti, assessment bodies that
manage product or service
eiiviionmental peitoimance stalldaids
and/or ecolabels that could be
coiisideifd loi use in Umled States
ledeial sustainable piocm< ment eltorts,
B What acnon is the Agen^x taking?
EPA is pxpandrnqtbe
Recommendations of Speciticalions.
Standards and Ecolabelb tin Fedeial
Purchasing. Interested applicants must
submit then lesponses to the scoping
queblioiib flectiomcalh to epp"ep(i.gov
\r\ Januan 1 2023 111' scoping
quebUoiib can be lound in the dncket or
at https //mui tpagoi/
qin'iuipiodu^ts/tiuhh uork-assessment-
i miionmcntal-peifoimance-standards-
and-ecolabf-h-ft'leial
C What is the \qtnc\ s authority for
taking this action1
This eiioit dir^cth uppoitb the
linpls mentation ol be\ eial Executn e
Oideib and st itiiks
tv-cu!r\ e Oidei 14008. entitled
Tackling the Climate Cusis it Home
and Abioad (86FR7blO tebiuan 1,
2n21) duetts the Fedeial government to
lead b\ example and leverage its buying
power to "catalyze private sector
investment into, and accelerate the
advancement of America's industrial
capacity to suppfy domestic clean
energy, buildings, vehicles, and other
necessary products and materials". The
expansion of the Recommendations will
help to spui this maiket demand ioi
moie sustainable pioductb and sen ices.
St-iiidaids and ecolabels included in
the Recommendations will albo help to
meet E\ecuti\e Oidei 14030 entitled
Climate-Related Fnunci d Risk (86 FR
27067 hla\ 20 2u21) which dnec ts the
Fedeial \cquisibon Regulatoiy (FAR)
Council to consid" r amending the FAR
to ensim that majoj piocuiem< nts
minimize the Jisk ol climate change.
The implementing instruction tor
Executive Oidei i4057 entith d
Cat ah zing Clt an Fneigy Industnes and
Jobs Thiough Ft deial SustainahihtV
(8b TR 700 35 Decembei Li 2021)
directs EPA to consider expanding the
Recommendations to facilitate net-zero
emissions procurement and other
related sustainable purchasing goals. In
addition, it directs federal purchasers to
prioritize products and services that
address multiple environmental
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 12
Appendix 2. Agenda
U.S. Environmental Protection Agency
Environmental Financial Advisory Board
Public Meeting
Virtual Platform
December 15, 2022
1:00-5:00 pm Eastern Time
1:00 pm
WELCOME, REVIEW OF AGENDA, AND CLIENT OFFICE REMARKS
Edward H. Chu - EFAB Designated Federal Officer
Kerry O'Neill - EFAB Chair
Alejandra Nunez and Tim Profeta - EPA Charge Client
1:30 pm
OBJECTIVES WORKGROUP
Cynthia Koehler and Margot Kane - Workgroup Co-chairs
2:15 pm
PROGRAM STRUCTURE WORKGROUP
Lori Collins and Ashley Allen Jones - Workgroup Co-chairs
3:00 pm
EXECUTION, REPORTING, AND ACCOUNTING WORKGROUP
Ted Chapman and MaryAnna Peavey-Workgroup Co-chairs
3:45 pm
BOARD DISCUSSION AND VOTE
Kerry O'Neill-EFAB Chair
4:15 pm
RECAP, WRAP-UP, AND CLIENT REMARKS
Alejandra Nunez and Tim Profeta - EPA Charge Client
Kerry O'Neill - EFAB Chair
Edward H. Chu - EFAB Designated Federal Officer
5:00 pm
ADJOURN
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 13
Appendix 3. EFAB Members
Ed Chu, Designated Federal Officer
Tara Johnson, Alternate Designated Federal Officer
NAME
AFFILIATION
LOCATION
PERSPECTIVE
REPRESENTED
CURRENT
TERM
ORIGINAL
APPOINTMEN
T DATE
Kerry O'Neill,
EFAB Chair
Chief Executive Officer,
Inclusive Prosperity
Capital, Inc.
Stamford,
Connecticut
(EPA Region 1)
Environmental/
Non-
governmental
Organization
July 20, 2021-
June 15, 2023
July 28, 2020
Ashley Allen Jones
Founder and Chief
Executive Officer, i2
Capital
Washington,
District of Columbia
(EPA Region 3)
Business -
Financial Services
June 21, 2022-
June 15, 2024
July 28, 2020
Courtney L Black
Deputy Finance
Director, City of Kent
Kent, Washington
(EPA Region 10)
State/Local
Government
June 21, 2022-
June 15, 2025
June 21, 2022
Steven J. Bonafonte
Assistant District
Counsel, The
Metropolitan District
of Hartford
Hartford,
Connecticut
(EPA Region 1)
Legal
June 21, 2022-
June 15, 2024
July 28, 2020
Angela Montoya
Bricmont
Chief Finance Officer,
Denver Water
Denver, Colorado
(EPA Region 8)
State/Local
Government
June 21, 2022-
June 15, 2024
July 28, 2020
Matthew T. Brown
Chief Financial Officer
and EVP, Finance and
Procurement, District
of Columbia Water and
Sewer Authority
Washington,
District of Columbia
(EPA Region 3)
State/Local
Government
June 21, 2022-
June 15, 2025
June 21, 2022
Stacy Brown
President and Chief
Executive Officer,
Freberg
Environmental, Inc.
Denver, Colorado
(EPA Region 8)
Business -
Financial Services
June 21, 2022-
June 15, 2024
July 28, 2020
Theodore Chapman
Investment Banking
Analyst, Hilltop
Securities, Inc.
Dallas, Texas
(EPA Region 6)
Business -
Financial Services
July 28, 2020-
June 15, 2023
September 25,
2017
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 14
NAME
AFFILIATION
LOCATION
PERSPECTIVE
REPRESENTED
CURRENT
TERM
ORIGINAL
APPOINTMEN
T DATE
Albert Cho
Senior Vice President,
Chief Strategy and
Digital Officer, Xylem,
Inc.
Washington,
District of Columbia
(EPA Region 3)
Business -
Industry
June 21, 2022-
June 15, 2025
June 21, 2022
Janet Clements
President and
Founder, One Water
Econ
Loveland, Colorado
(EPA Region 8)
Business -
Industry
June 21, 2022-
June 15, 2025
June 21, 2022
Lori Collins
Owner and Principal,
Collins Climate
Consulting
Charlotte, North
Carolina
(EPA Region 4)
Business -
Industry
June 21, 2022-
June 15, 2025
June 21, 2022
Zachary Davidson
Director of
Underwriting,
Ecosystem Investment
Partners
Baltimore,
Maryland
(EPA Region 3)
Business -
Financial Services
June 21, 2022-
June 15, 2024
July 28, 2020
Jeffrey R. Diehl
Chief Executive Officer,
Rhode Island
Infrastructure Bank
Providence, Rhode
Island
(EPA Region 1)
State/Local
Government
June 21, 2022-
June 15, 2024
July 28, 2020
Sonja B. Favors
Industrial Hazardous
Waste Branch Chief,
Alabama Department
on Environmental
Management
Montgomery,
Alabama
(EPA Region 4)
State/Local
Government
June 21, 2022-
June 15, 2024
July 28, 2020
Phyllis R. Garcia
Treasurer, San Antonio
Water
System
San Antonio, Texas
(EPA Region 6)
State/Local
Government
June 21, 2022-
June 15, 2024
July 28, 2020
Eric Hangen
Senior Research
Fellow, Center for
Impact Finance, Carsey
School of Public Policy,
University of New
Hampshire
Danby, Vermont
(EPA Region 1)
Academic
June 21, 2022-
June 15, 2025
June 21, 2022
Edward Henifin
General Manager
(retired), Hampton
Roads Sanitation
District
Virginia Beach,
Virginia
State/Local
Government
July 28, 2020-
June 15, 2023
June 15, 2018
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 15
NAME
AFFILIATION
LOCATION
PERSPECTIVE
REPRESENTED
CURRENT
TERM
ORIGINAL
APPOINTMEN
T DATE
(EPA Region 3)
Barry Hersh
Clinical Professor and
MSRED Chair, School
of Professional Studies,
New York University
New York, New
York (EPA Region 2)
Academic
June 21, 2022-
June 15, 2025
June 21, 2022
Craig Holland
Senior Director of
Urban Investments,
The Nature
Conservancy
Arlington, Virginia
(EPA Region 3)
Environmental/
Non-
governmental
Organization
July 28, 2020-
June 15, 2023
September 25,
2017
Craig A. Hrinkevich
Public Finance Team -
New Jersey Managing
Director, Robert W.
Baird & Company, Inc.
Red Bank, New
Jersey
(EPA Region 2)
Business -
Financial Services
June 21, 2022-
June 15, 2024
July 28, 2020
Margot Kane
Chief Investment
Officer, Spring Point
Partners LLC
Philadelphia,
Pennsylvania
(EPA Region 3)
Business -
Financial Services
June 21, 2022-
June 15, 2024
July 28, 2020
Thomas Karol
General Counsel
Federal, National
Association of Mutual
Insurance Companies
Washington,
District of Columbia
(EPA Region 3)
Legal
June 21, 2022-
June 15, 2025
June 21, 2022
George W. Kelly
Global Client Strategy
Officer,
Earth Recovery
Partners
Denver, Colorado
(EPA Region 8)
Business -
Financial
Services
June 21, 2022-
June 15, 2024
July 28, 2020
Gwendolyn Keyes
Fleming
Partner, DLA Piper LLP
Washington,
District of Columbia
(EPA Region 3)
Legal
June 21, 2022-
June 15, 2025
June 21, 2022
Cynthia Koehler
Executive Director,
WaterNow Alliance
San Francisco,
California
(EPA Region 9)
Environmental/
Non-
governmental
Organization
June 21, 2022-
June 15, 2024
July 28, 2020
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 16
NAME
AFFILIATION
LOCATION
PERSPECTIVE
REPRESENTED
CURRENT
TERM
ORIGINAL
APPOINTMEN
T DATE
Colleen Kokas
Executive Vice
President,
Environmental Liability
Transfer,
Inc.
Lahaska,
Pennsylvania
(EPA Region 3)
Business -
Industry
June 21, 2022-
June 15, 2024
July 28, 2020
Joanne V. Landau
President and Chief
Investment Officer,
Kurtsam Realty Corp.
Croton-on-Hudson,
New York
(EPA Region 2)
Business -
Industry
June 21, 2022-
June 15, 2025
June 21, 2022
Lawrence Lujan
Executive Director,
Taos Public
Utility Service
Taos, New Mexico
(EPA Region 6)
Tribal
Government
June 21, 2022-
June 15, 2025
June 21, 2022
MaryAnna H. Peavey
Grants and Loans
Bureau Supervisory,
Idaho Department
of Environmental
Quality
Boise, Idaho
(EPA Region 10)
State/Local
Government
June 21, 2022-
June 15, 2024
July 28, 2020
Dennis A. Randolph
City Traffic Engineer,
City of Kalamazoo
Public Services
Department
Kalamazoo,
Michigan
(EPA Region 5)
State/Local
Government
June 21, 2022-
June 15, 2024
July 28, 2020
Eric Rothstein
Principal, Galardi
Rothstein Group
Montreat, North
Carolina
(EPA Region 4)
Business -
Financial Services
July 28, 2020-
June 15, 2023
September 25,
2017
Sanjiv Sinha
Chief Sustainability
Officer, Environmental
Consulting &
Technology, Inc.
Ann Arbor,
Michigan
(EPA Region 5)
Business -
Industry
June 21, 2022-
June 15, 2025
June 21, 2022
William Stannard
Chairman of the Board,
RAFTELIS
Kansas City,
Missouri
(EPA Region 7)
Business -
Financial Services
July 28, 2020-
June 15, 2023
June 15, 2018
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 17
NAME
AFFILIATION
LOCATION
PERSPECTIVE
REPRESENTED
CURRENT
TERM
ORIGINAL
APPOINTMEN
T DATE
Marilyn Waite
Managing Director,
Climate Finance Fund
Washington,
District of Columbia
(EPA Region 3)
Business -
Financial Services
June 21, 2022-
June 15, 2025
June 21, 2022
David L. Wegner
Senior Consultant on
Water, Climate
Change, and Asset Risk
Assessment, Water
Science and
Technology Board,
National Academy of
Sciences
Tucson, Arizona
(EPA Region 9)
Business -
Industry
June 21, 2022-
June 15, 2025
June 21, 2022
Gwen Yamamoto Lau
Executive Director,
Hawaii Green
Infrastructure Authority
Honolulu, Hawaii
(EPA Region 9)
State/Local
Government
June 21, 2022-
June 15, 2025
June 21, 2022
David Zimmer
Executive Director, New
Jersey Infrastructure
Bank
Lawrenceville, New
Jersey
(EPA Region 2)
State/Local
Government
July 28, 2020-
June 15, 2023
June 15, 2018
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 18
Appendix 4. Slide Presentations
EPA Environmental Financial Advisory Board
GHGRF Charge
Public Meeting
December 15, 2022
What is EFAB?
EFAB is a Federal Advisory
Committee, an independent
advisory body chartered
under the Federal Advisory
Committee Act (FACA) with
members representing
various constituencies.
All meetings are open to
the public.
All materials are available
online via EPA's website.
For more information on EFAB, visit:
https://www.epa. go v/waterf in an cecenter/efab
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 19
Charge Background and Summary
Section 60103 of the Inflation Reduction Act of 2022 - Amended the Clean Air Act to create a new program:
the Greenhouse Gas Reduction Fund (GHGRF)
This first-of-its-kind program will provide competitive grants to mobilize financing and leverage private capital for clean
energy and climate projects that reduce greenhouse gas emissions - with an emphasis on projects that benefit low-income
and disadvantaged communities.
The GHGRF provides $27 billion to EPA for expenditure until September 30, 2024. This includes:
$7 billion for competitive grants to enable low-income and disadvantaged communities to deploy or benefit from zero-
emission technologies, including distributed technologies on residential rooftops;
Nearly $12 billion for competitive grants to eligible entities to provide financial and technical assistance to projects that
reduce or avoid greenhouse gas emissions; ana
$8 billion for competitive grants to eligible entities to provide financial and technical assistance to projects that reduce or
avoid greenhouse gas emissions in low-income and disadvantaged communities.
EPA launched a coordinated stakeholder engagement strategy to help shape the implementation of the
GHGRF and ensure economic and environmental benefits are realized by all Americans.
Public Listening Sessions - November 1 and November 9, 2022; recordings available online
Request for Information - Public comment period open until December 5, 2022
Solicitation of Expert Input from EFAB
October 19,2022 - Formal charge questions presented by EPA and approved by EFAB
December 15,2022 - Final charge deliverable presented by EFAB
For more information on the GHGRF at EPA, visit:
https ://ww w. epa.gov/inflation-reduction-act/greenhouse-gas-reduction-fund
Charge Status
EFAB created three (3) workgroups for three (3)
categories of charge questions:
1. Objectives;
2. Program Structure; and
3. Execution, Reporting, and Accountability.
Workgroup Progress
Given the extremely compressed timeline of this charge (2
months vs. 1-2 years), workgroups have drawn on their own
expertise and that of their constituent networks, reviewing
public comments and other readily available literature.
Materials are in no way meant to be exhaustive; they
represent a summary of workgroup deliberations.
Workgroups have largely been working independently, with
some coordination on overarching themes.
Today: Present and review the final
EFAB GHGRF charge deliverable
(full slide deck) and hold two (2)
EFAB votes:
1. To approve the deliverable.
The deliverable contains EFAB "options
for EPA consideration" for the GHGRF,
not recommendations.
2. To authorize the creation of a
transmittal letter to EPA.
The transmittal letter will note key
themes and summarize the deliverable.
It will be shared with EFAB for a vote to
approve (via email) before officially
submitting, with the deliverable and
public comments, to EPA.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 20
Objectives Workgroup
GHGRF Charge - Objectives
Workgroup Overview
This workgroup was asked to provide considerations around the GHGRF's
objectives, including:
How to fund and/or finance projects intended to reduce GHG emissions that are not being
resourced today, particularly in low-income and historically disadvantaged communities;
Program Efficiency; and
o Design Elements (e.g., leverage, additionality).
o Complementary Programs and Structures.
Environmental Justice / Definition of "Low-Income and Disadvantaged Communities."
o Definition and Support Considerations.
o Technical and Financial Assistance, including application support assistance.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 21
GHGRF Charge - Objectives
Key Challenges to Achieving GHGRF Objectives
There is a lack of requisite capital at reasonable costs and flexibility.
Priority areas for reducing GHGs (e.g., agriculture, buildings, industry,
transportation) may not readily lend themselves to existing funding structures in
priority communities.
There is a lack of technical and human capacity to plan and prepare for grant
applications, financing, and project development.
There is a lack of start-up "capital" (e.g., technical assistance, planning / pre-
development grants).
GHGRF Charge - Objectives
Overarching Approach to GHGRF Objectives
1. Balance equity and access objectives with leverage objectives.
Seek higher levels of financing leverage (hard and soft match) for projects in communities with greater capacity and
access to resources.
Have lower leverage (hard and soft match) requirements for projects requiring some subsidization, associated with
less resourced communities.
¦ No leverage requirements for grant funded projects primarily intended to provide various benefits / technical
assistance to disadvantaged communities.
2. Balance need for "shovel-ready" projects with capacity building goals.
Goal is rapid deployment, so project-specific criteria should focus on that.
Conventional meaning of "shovel-ready" projects (e.g., designed, engineered, permitted) is only one path to
achieving rapid deployment, and could exclude projects that could/should be supported by one or more of the
GHGRF streams.
Consider development of other indicia of rapid deployment; to the extent there is still an interest in elevating
"shovel-ready" projects, this could include a one to two (1-2) year design period.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 22
GHGRF Charge - Objectives
Overarching Approach to GHGRF Objectives
3. Acknowledge a variety of mandates and objectives in the short-term.
Leveraging financing and ensuring GHGRF funds flow to disadvantaged communities will not always lead to
prioritizing the same types, sizes, or timeframes of projects or community supports.
In the long-term, investing in community capacity, technical assistance, and the ability to develop a wider array of
projects and sizes will sustainably increase GHG reduction ability on a national level; however, this approach may not
always optimize for leverage and "shovel-readiness" in the short-term.
Another framing for this principle is balancing the interest in "building balance sheets" vs "building markets" -
interventions can build the capacity of key players in a marketplace and/or support the scale and impact of a
marketplace; both are important for long-term impacts.
EPA has flexibility to design the GHGRF to empower states, municipalities, tribes, and eligible entities to select
solutions that accomplish only one of these objectives well, while ensuring performance of both in the aggregate.
For example, EPA could enable project selection that:
o Prioritizes GHG reduction projects that provide direct benefits to disadvantaged communities, but that will not necessarily
leverage private capital in the short-term (e.g., capacity building, workforce development, reduction of localized pollution),
o Enhances funding additionality and recycling that may not provide immediate benefits to disadvantaged communities but are
likely to provide funding sustainability for GHG reduction programs for the long-term (beyond 2024).
o Establishes performance metrics demonstrating that selected projects in the aggregate accomplish objectives.
j
GHGRF Charge - Objectives
Overarching Approach to GHGRF Objectives
4. Ensure eligible recipient(s) are positioned to serve priority communities effectively.
To meet the Congressional directives to not only reduce GHGs but also to serve and benefit low-income and
disadvantaged communities, it will be important that the direct recipient(s), as well as indirect project applicant(s),
have the capacity and experience to ensure that those communities and their interests are well represented.
Additionally, in alignment with Justice40, intentional support of Black, Indigenous, and People of Color (BlPOC)-led
organizations and communities will help EPA achieve GHG reduction goals in under-resourced communities that are
also the most burdened and most vulnerable to GHG-related impacts.
To these ends, it is important for EPA to incorporate consideration of diversity, equity, and inclusion within the
leadership, structure, and decision-making of eligible recipient(s), as well as demonstrated record of success in
working with and addressing the needs of low-income and disadvantaged communities.
Centering representative, proximate, and diverse perspectives among the value chain of recipient(s) will increase
equitable opportunities for communities to access GHGRF funding. Ideally, this will also provide accountability and
feedback loops from communities back to EPA.
Resourcing a diversity of decision makers with deep experience in low-income and disadvantaged communities may
also help mitigate potential harms arising from GHGRF, such as:
o Many low-income households are already indebted, and any new consumer financial products should not aim to increase
household debt.
o Similarly, city-funded rebate programs may count against taxable income thresholds for low-income families and risk
compromising other critical supports for housing, childcare, or food (known as the "benefit cliff" issue).
10
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 23
GHGRF Charge - Objectives
Designing for Flexibility to Meet Varying Mandates
Near-term trade-offs between program efficiency and program objectives might be:
o GMGRF timeline vs. measurable GHG reductions;
o Leveraging and recycling funds vs. capacity building in communities;
o Community reach vs. timeline / administrative burden;
o Benefits reaching low-income and disadvantaged communities vs. long-term financial sustainability requirements;
o Prioritizing GHG reduction performance in the first year of the program could disadvantage efforts to build low-
income and disadvantaged communities' capacity to develop GHG reduction initiatives and projects; and
o "Shovel-ready" vs. community-supported projects.
In response, the GHGRF funding streams could be subject to varying weights and objectives in order to
achieve multiple goals. For example;
o $7B to States / Municipalities / Tribes could be more heavily weighted towards capacity building, low-income
community impacts and programs, and additionality (projects that wouldn't otherwise get done),
o $8B could be more heavily weighted towards capacity building, additionality, long-term sustainability, and technical
assistance.
o $12B could be more heavily weighted towards leverage and capital recycling, long-term sustainability of financial
assistance, and scale of GHG impacts.
Additionally, emphasis could vary based on the nature of both direct and indirect recipient(s).
ii
GHGRF Charge - Objectives
Program Efficiency-Design Elements
Charge Question l.b.i:
How can the GHGRF grant competition be designed so that funding is highly leveraged (i. e., each dollar of federal funding mobilizes
multiple dollars of private fundingf?
How can the funding be used to maximize "additionality" (i.e., the extent to which funding catalyzes new projects that would not
otherwise occur)?
How can EPA balance the need for grants for capacity building and short-term results with financial structures that will allow capital to
be recycled over time?
Where (if at all) is it appropriate to impose sustainability requirements on direct or indirect beneficiaries of GHGRF funding?
This workgroup provided guidance in terms of:
Strengths and weaknesses of each of the above elements by recipient / project type;
Strong fits and weak fits of each element by recipient / project types; and
Careful perusal of the public comments, which provide a wealth of specific examples from other programs
for EPA's consideration.
12
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 24
GHGRF Charge - Objectives
GHGRF Design Elements by Direct Recipient Type and
Suggested Relevance ("weight")
Aligned Recipient
Leverage
Additionality
Capital Recycling
Capacity Building
Long-Term
Operability
States / Municipalities /Tribes
Low weight
High weight
Medium weight
High weight
Medium weight
National Green Bank / Fund
High weight
Medium weight
Medium weight
Low weight
High weight
Collective Action - Regional
Medium weight
High weight
Medium weight
High weight
Low weight
Collective Action - Sectoral
High weight
Low weight
Medium weight
Medium weight
Medium weight
Lender Intermediaries
High weight
Low weight
High weight
Low weight
High weight
GHGRF Charge - Objectives
Program Efficiency - Design Elements
Design Element
Strengths / Weaknesses
Strong / Weak Fits
Aligned Recipients
Leverage: The ability of a
recipient or project to evidence
additional private sector funding
sources
Strengths
Crowds in additional dollars from other sources
Enables larger projects
Stretches ta xpayer resources further
Can provide risk mitigation for private capital
Weaknesses
Burdensome from a structuring and transaction cost
standpoint
May increase cost of capital
Less workable in smaller projects
Strong Fits
Large asset-backed projects
Subordinatetranches in structured funds
Nonprofit and commercial projects
Residential solar leases
Weak Fits
Smaller community-based organizations
Smaller municipalities
Matching technical assistance dollars
Non-commercia I project costs (e.g., pre-
development)
Higher Leverage
States / Municipalities / Tribes
National Green Bank / Fund
Lender Intermediaries
Lower Leverage
Collective Action-Regional
Collective Action - Sectoral
Short-Term Capacity Building:
Use of funds is predominantly to
hire expertise / staff to improve
communities' ability to plan and
execute GHG reduction projects
Strengths
Enables attribution to leaders, organizations on
successful projects
May enable projects in disinvested / overlooked
communities
Weaknesses
Challenging to measure and easy to critique
May complicate decision-making around eligible
projects
Doesn't always collaborate well with other funding
sources
Strong Fits
Where capita I has historically not been
invested
Where funding is clearly taking "de-risking" role
for private capital
Planning and pre-development funding
Weak Fits
Industrial/large-scale projects
Loss-sharingguarantees
Pari passu funding structures
Senior debt
More Additionally
States / Municipalities/ Tribes
National Green Bank / Fund
Collective Action-Regional
Combination of Structures
Less Additionally
Collective ActionSectoral
Lender Intermediaries
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 25
GHGRF Charge - Objectives
Program Efficiency - Design Elements
Design Element
Strengths / Weaknesses
Strong / Weak Fits
Aligned Recipients
Capital Recycling: The ability of
recipient(s) to recycle / re-
deploy the funding provided
overtime
Strengths
Bolsters financial susta inability of recipient(s) for the
long-term
Ensures long-term impacts after program funding
window is closed
Builds intermediary capacity
Enables strong leverage opportunities
Weaknesses
Desire to recoup capital reduces risk tolerance of funds
Incentives for recipient(s) may be at odds with purpose
(e.g., funds may be used for reserves or liquidity vs.
deployment)
Ability to recycle capital within reporting period may be
limited by long-term project finance cycles, which are
common in energy (20 years)
Strong Fits
Financial intermediaries who are lenders
Higher Recycling Ability
National Green Bank / Fund
Collective Action - Regional
Collective Action - Sectora I
Lender Intermediaries
Weak Fits
Equity investments (because of both illiquidity
and risk)
Start-up capital
Technical assistance
Projects without material cash payout over 10+
years
Lower Recycling Ability
States/Municipalities/Tribes
Additionality: Demonstrating
the essential contribution ofthe
GHGRF to getting the project
done; "but forthis funding..."
Strengths
Evident and persistent demand for capacity building
support, especially in low-income / disadvantaged
communities
High demand for in-community, long-term human
capacity
Can increase uptake / demand for financia I assistance /
pipeline projects
Weaknesses
Once money is allocated, limited future funding sources
Short funding period incentivizesuse of consultants vs.
full-time hires
No leveraging / recycling ability
Overlooked communities may be unaware of funding
opportunities and lack grant application bandwidth
Strong Fits
M iddle and low-income communities with the
most to gain from technical assistance and
funding navigator support
In communities with coordinated accessto long-
term technical assistance funding
When paired with green workforce
developments increase local skilled workforce
For short-term trainings around grant
applications, reporting,and compliance
Planning uses for GHG projects
Weak Fits
Not as well suited to project-specific funding
Stronger Capacity Building
States/Municipalities/Tribes
Collective Action - Regional
Combination of Structures
Weaker Capacity Building
National Green Bank / Fund
Collective Action - Sectora I
Lender intermediaries
GHGRF Charge - Objectives
Program Efficiency - Design Elements
Design Element Strengths / Weaknesses
Strong / Weak Fits
Aligned Recipients
Strengths
Strong Fits
Stronger Sustainability Reporting
Reassures EPA of recipient(s)' abilities to manage.
Established financial intermediaries
States
invest, and report upon funds in compliant and
The lead partners (or primes) of a regional or
Collective Action-Regional
efficient ways
sectoral collaboration
Collective Action-Sectoral
Recipient(s) with stronger long-term financial
Quasi-governmental development entities and
Lender Intermediaries
sustainability have:
other public sector agencies (e.g., EDCs, HFAs,
Proven track record of completing GHGR projects
Port Authorities)
Proven ability to reach low-income and
Long-Term Sustainability Reporting: disadvantaged communities
Greater likelihood of project completion
Greater ability to recycle and leverage capital
Weaknesses
Weak Fits
Weaker Sustainability Reporting
Burdensome for small entities
Intermediaries with limited track record or
Municipalities /Tribes
Challenging to apply to many governmental entities
historical financials
National Green Bank / Fund
Challenging to track across indirect recipient(s) in a
Community-based organizations reliant upon
Combination of Structures
standardized manner
grant funding
* Difficultto apply to newly created oryetto be
Municipalities and agencies with tower credit
created entities
ratings
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 26
GHGRF Charge - Objectives
Program Efficiency-Complementary Programs and Structures
Charge Question l.b.ii:
Are there programs / structures at the federal or state level that could effectively complement the GHGRF?
How can EPA best leverage the GHGRF to support lasting, long-term (beyond 2024) transformation of the clean energy and climate
finance ecosystem, especially for disadvantaged communities, and greenhouse gas and other air pollution reductions?
The opportunity to design the GHGRF so that it amplifies and advances other programs with
similar and/or overlapping goals is very large, encompassing dozens, if not hundreds, of
potentially aligned initiatives.
Identifying a full set of such programs is thus beyond the capacity of the current EFAB assignment,
which has focused instead on developing a set of guiding principles to support EPA in prioritizing
identification of such programs.
Coordination with other agencies and connecting program recipients can enable alignment with
the GHGRF over time.
1?
GHGRF Charge - Objectives
Program Efficiency-Complementary Programs and Structures
Guiding principles / "good fits:"
Use Justice40 not as a "maximum" target to be achieved, but as minimum starting point for the entire program;
Share emphasis on low-income / disadvantaged communities (definitions may vary), specifically programs focusing
on and/or filling gaps. For example:
o Energy efficiency measures for low-income housing and technical assistance for same,
o DOE's Energy Infrastructure Reinvestment Program.
Water efficiency programs (water / energy nexus), including SRF Green Reserve;
Where the GHGRF could provide matching funds required by other infrastructure programs;
Tax credits intended to incentivize energy efficiency and reduced GHG emissions;
Seek defined co-benefits in communities;
Clean energy programs that share GHG reduction objectives, preferably with the ability to measure GHG impacts;
Reach communities across the U.S. and/or state-level at a minimum with emphasis on low-income / disadvantaged
communities;
Established relationships with direct recipient(s), especially states / municipalities / tribes; and
Funding programs that focus on de-risking projects for later private investment.
"Nice to haves:"
Workforce development components in the "green economy;" and
Focus on orphan projects / additionality.
18
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 27
GHGRF Charge - Objectives
Environmental justice / Definition of "Low-Income and Disadvantaged
Communities" - Definition and Support Considerations
Guiding principles and considerations:
Provide clarity to direct and indirect recipient(s) and participants about EPA's expectations;
Acknowledge that no one definition will meet the needs of every region, state, tribe, and/or community;
Any definitions used should increase inclusion of communities and organizations for consideration;
Acknowledge the importance of defining disadvantaged communities more broadly than by median income or other
existing federal and/or state metrics. For example:
o Recognize that communities are not always bounded by political boundaries (e.g., cities, townships, counties),
o A community may be as small as a census tract.
o Tribal communities and nations may use different definitions from states and municipalities.
Encourage the use of EJSCREEN and other federal mapping tools;
Acknowledge that existing federal and tribal criteria used today may not be sufficient to capture sub-populations in
large cities, as well as unique challenges in rural communities; and
As part of the grant management process, work with direct and indirect recipient(s) to develop aggregate measures
that can capture the impact of GHGRF on priority communities.
19
GHGRF Charge - Objectives
Environmental Justice / Definition of "Low-Income and Disadvantaged
Communities" - Inclusive Model for Defining
In addition to existing definitions, accept and allow for the use of additional criteria in guiding principles to ensure inclusive
and equitable access to GHG and localized pollution reduction benefits.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 28
GHGRF Charge - Objectives
Project-Level Fund Eligibility: Defining "Low-Income / Disadvantaged Communities"
Guiding Principle
Strengths / Weaknesses
Acknowledge the importance of defining disadvantaged
communities more broadly than by median income or
other existing federal and/or state metrics
Strengths
Ability to optimize project benefits and expand range of solutions
Enables a more inclusive and equitable access to GHG reduction funds and benefits
Weakn esses
May create measurement and tracking challenges
Guardrails needed to ensure the definition does not become all-encompassing
Accept existing federal definitions and eligibility criteria
(e.g., HUD Area Median Income, DHSTANF eligibility
criteria, SBA size standards)
Strengths
Easier for EPA to deploy quickly
Supports standardized reporting nationwide
Allows for eligibility on the household / entity level
Weakn esses
May not be optimized for pollution reductions
May make it harder to include pockets of low-income and disadvantaged communities
that have been historically excluded from federal support
Accept state and tribal definitions (by statute) as
applicable and when they prove to increase inclusion
Strengths
Aligns with existing state priorities and funding programs
Prioritized projects on Intended Use Plans could be screened for GHG reduction potential
Weakn esses
May not be optimized for pollution reductions
May make it harder to include pockets of low-income and disadvantaged communities
that have been historically excluded from state support
21
GHGRF Charge - Objectives
Project-Level Fund Eligibility: Defining "Low-Income / Disadvantaged Communities"
Guiding Principle
Strengths/ Weaknesses
Encourage the use of EJSCREEN and other federal
mapping tools
Strengths
Standardized eligibility nationwide
Easy to access
Easy for EPA to deploy
Weaknesses
Excludes a significant number of communities
May miss sub-areas and sub-populations within large boundaries
Some tools may not be optimized
Acknowledge that existing federal and tribal criteria used
today may not be sufficient to capture sub-populations in
large cities, as well as unique challenges in rural
communities
Strengths
Ability to optimize for GHG reduction and community co-benefits
Inclusive of sub-populations within larger cities and rural locales lacking critical
infrastructure
Inclusive of other important criteria (e.g., health burdens caused by pollution levels, cost
of energy, cost of housing / living, climate fragility)
Weaknesses
Depending on whether the criteria is flexible or formulaic, could be overly complex
without ensuring equitable inclusivity
May create tracking challenges
22
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 29
GHGRF Charge - Objectives
Environmental Justice / Definition of "Low-Income and Disadvantaged
Communities" - Technical Assistance*
Charge Question What kinds of technical... assistance should GHGRF funding recipients provide to ensure that low-income and
disadvantaged communities are able to be direct or indirect beneficiaries of GHGRF funding? Please identify supports that could help
communities with project implementation.
The GHGRF could support a wide variety of TA#for both institutions disbursing funds and for communities to help develop
projects that can eventually seek resources from the GHGRF.
Type of TA will vary across phases of implementation and based on:
Project Applicants;
Project Types;
Local Benefit Pathways; and
o Workforce benefits,
o Economic development benefits,
o Public health benefits.
Issues faced by community.
Third parties to coordinate across communities and departments and create capacity to develop, apply, fund, and implement projects. These
could be national or regional organizations or include very localized community groups. Examples include but are not limited to:
NGO Navigators to provide funding TA for application support;
NGOsto provide project development, design, and implementation support;
AmeriCorps;
State extension programs;
USACE Silver Jackets;
Engineers Without Borders; and
Senior design projects at accredited university engineering programs.
Integrated with GHGRF Charge Workgroup 2 (Program Structure} and 3 fExecution> Reporting, and Accountability)
GHGRF Charge - Objectives
Environmental Justice / Definition of "Low-Income and Disadvantaged
Communities" - Technical Assistance
TA needs will vary across all aspects of implementation and depend on several factors, including:
Who needs assistance (e.g., project developers, communities, local government entities, households)?
Project type (e.g., agriculture, buildings, industry, transportation)?
o Identifying funding opportunities and synergies;
o Applying for funds;
o Broader project financing analysis;
o Project design and implementation planning;
o Identifying relevant case studies and other project-related research;
o Economic analysis;
o Data development and analytics;
o Developing and deploying performance metrics;
o Legal and policy analysis;
o Community outreach and education; and
o Long-term capacity building.
Benefits being achieved?
o Funding benefits: TA for funding application assistance and other "navigator" support.
o Local workforce development: TA for project development, design, implementation planning workforce training, and small
business development.
o Public health: TA for mapping to identify high leverage pollution reduction opportunities / needs, project design and
development, large-scale and more localized projects, and performance metrics to demonstrate connections.
24
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 30
GHGRF Charge - Objectives
Environmental Justice / Definition of "Low-Income and Disadvantaged
Communities" - Financial Assistance*
Charge Question What kinds of... financial assistance should GHGRF funding recipients provide to ensure that low-income and
disadvantaged communities are able to be direct or indirect beneficiaries of GHGRF funding? Please identify supports that could help
communities with project Implementation.
Given the capital constraints evidenced across the country, providing direct financial assistance to communities and
project proponents in the form of grants will most immediately advance projects in low-income and disadvantaged
communities. As a secondary tool, low-cost and patient debt is also an accelerant for these projects, when paired with
adequate pre-development resources.
EPA might also consider that the effectiveness of financial assistance goes beyond the tools and resources themselves, to
the pathways through which such support is provided. To this end, developing principles around financial assistance would
be additive, such as:
o Prioritize pathways for the funding streams dedicated to and/or led by low income / disadvantaged communities, through entities
and institutions set up to fund projects at the neighborhood or community level, with accountability to those communities,
o Prioritize funders and lenders with strong representation within and ties to the communities they serve, thereby providing
community-centered TA delivered by trusted experts,
o Take advantage of lessons and best practices developed by other federal and state initiatives around lending to small
businesses, including the U.S. Treasury's Office of Small and Disadvantaged Business Utilization, State Small Business Credit Initiative
(SSBCI), and Department of Commerce's assistance programs focused on underserved entrepreneurs.
0Integrated with GHGRF Charge Workgroup 2 (Program Structure) and 3 (Execution, Reporting, and Accountability) 21
GHGRF Charge - Objectives
Environmental Justice / Definition of "Low-Income and Disadvantaged
Communities" - Financial Assistance
Additionally, GHGRF recipient(s) among all funding streams, including state and tribal recipient(s), could
adopt financing tools and policies aimed at addressing structural issues that limit access to capital in such
communities, such as:
o Developing flexible or forgivable lending structures designed with low-cash flow households in mind;
o Establishing non-traditional methods of loan repayment (e.g.. Pay as You Save, Property Assessed Clean
Energy financing); and
o Adopting policies that facilitate flows of funds towards low-income households within larger programs. For example:
¦ Per public comment, Maryland's community solar pilot program required 30% of Its solar capacity to be reserved for
projects serving LMI households.
¦ To further drive adoption of community solar, the state incentivized developers and investors by guaranteeing to recover
any losses from non-payment of bills.
¦ In exchange, developers had to agree to a 20% discount on low-income subscribers' electricity bills with no credit limits
/ requirements.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 31
GHGRF Charge - Objectives
Environmental Justice / Definition of "Low-Income and Disadvantaged
Communities" - Financial Assistance
Given the funding window for the GHGRF, partners selected for financial assistance should have already intentionally
designed their services and products to overcome barriers to capital among low-income and disadvantaged communities.
For example:
o Mission-driven lenders whose product suites are designed for low-income borrowers and undercapitalized projects, such as CDFIs.
o Capital providers who use alternative underwriting criteria that expand the communities / households that can be served compared
to conventional FlOC-based models.
¦ Florida's Solar and Energy Loan Fund doesn't use conventional underwriting criteria to serve LMI clients, and still achieves a default rate of < 2%.
Consider the value of indirect financial assistance (e.g., support for initiatives that may not provide immediate GHG
reductions, but build the local ecosystem required to support GHG reduction projects in ways that generate local
economic development over the long-term). Examples include:
o Accelerators or gap financing to support low emission business establishment; and
o Workforce development support for the requisite local zero-emission businesses, including weatherization, electrification, etc.
Given the vulnerability of lower-income households to predatory lending practices, which can cause over-indebtedness,
EPA may benefit from consulting with the Consumer Financial Protection Bureau and/or nonprofit organizations like the
Center for Responsible Lending on "do no harm" standards for loan products that aim to serve low-income households.
This workgroup acknowledges that this is a much larger topic than could be adequately addressed in the time available, and
notes there is a rich set of examples of financial assistance approaches in the public comments to EPA.
27
GHGRF Charge - Objectives
Potential Indicators of Success
GHG reduction impacts.*
Low-income and disadvantaged community impacts. For example:
o Capacity building and technical assistance deployed;
o Energy burdens / costs reduced for households;
o Increased access to GHG-reducing products, and increase in affordable financing or grant capital;
o Workforce initiatives (training, hiring, and retention);
o Other community benefits (e.g., "greened" areas, health and pollution impacts, walkability indices); and
o Dollars deployed by BIPOC-led organizations.
Program efficiency and performance.*
o Time-bound performance (e.g., deployment and reach);
o Leverage;
o Additionality;
o Recycling; and
o Sustainability Reporting.
'See GHGRF Charge Workgroup 3 (Execution, Reporting, and Accountability) for metric examples 28
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 32
GHGRF Charge - Objectives
Thank You!
EFAB GHGRF Charge - Objectives Workgroup
Name
Affiliation
Location
Sector
Margot Kane (co-chair)
Chief Investment Officer, Spring Point Partners LLC
Philadelphia, PA (EPA Region 3)
Business - Financial Services
Cynthia Koehler (co-chair)
Executive Director, WaterNow Alliance
San Francisco, CA (EPA Region 9)
Environmental / Non-
Governmental Organization
Ashley Allen Jones
Founder and Chief Executive Officer, i2 Capital
Washington, DC (EPA Region 3)
Business - Financial Services
Angela Montoya Bricmont
Chief Finance Officer, Denver Water
Denver, CO (EPA Region 8)
State / Local Government
Stacy Brown
President and Chief Executive Officer, Freberg Environmental, Inc.
Denver, CO (EPA Region 8)
Business - Financial Services
Ted Chapman
Investment Banking Analyst, Hilltop Securities, Inc.
Dallas, TX (EPA Region 6)
Business - Financial Services
Janet Clements
President and Founder, One Water Econ
Loveland, CO (EPA Region 8)
Business - Industry
Jeff Diehl
Chief Executive Officer, Rhode Island Infrastructure Bank
Providence, Rl (EPA Region 1)
State / Local Government
George Kelly
Global Client Strategy Officer, Earth Recovery Partners
Denver, CO (EPA Region 8)
Business - Financial Services
Lawrence Lujan
Executive Director, Taos Pueblo Utility Service
Taos, NM (EPA Region 6)
Tribal Government
Dennis Randolph
CityTraffic Engineer, City of Kalamazoo Public Services Department
Kalamazoo, Ml (EPA Region 5)
State / Local Government
Sanjiv Sin ha
Chief Sustainability Officer, Environmental Consultingand Technology, Inc.
Ann Arbor, Ml (EPA Region 5)
Business - Industry
David Wegner
Senior Consultant on Water, Climate Change, and Asset Risk Assessment, Water
Science and Technology Board, National Academy of Sciences
Tucson, AZ (EPA Region 9)
Business - Industry
Gwen Yamamoto Lau
Executive Director, Hawaii Green Infrastructure Authority
Honolulu, HI (EPA Region 9)
State / Local Government
29
Program Structure Workgroup
30
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 33
GHGRF Charge - Program Structure
Workgroup Overview
This workgroup was asked to provide considerations around the GHGRF's program
structure, including:
Eligible Recipient(s);
Eligible Projects; and
o Types of Projects / Sectors / Market Segments,
o Barriers, Gaps to Fill, and Strategies,
o Beneficiaries / Low-Income Communities.
Structure of Funding.
o Design Requirements,
o Compliance and Streamlining.
31
GHGRF Charge - Program Structure
Approach to Evaluations
This workgroup includes finance professionals from public, private, and philanthropic sectors with
expertise in energy, water, agriculture, and more. Since EFAB accepted this charge on October 19,
2022, this workgroup:
o Conducted interviews within EFAB;
o Interviewed third-party experts in relevant sectors and types of capital (e.g., community development,
technical assistance, project finance, equity); and
o Reviewed both written and oral public comments.
Objectives of approach
o Highlight list of potential eligible project, recipient, and program structure options;
o Assess pros / cons (strengths / weaknesses) of options relative to overall program design elements and
requirements; and
o Inform EPA staff versus recommend specific options.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 34
GHGRF Charge - Program Structure
Eligible Recipient(s)
Charge Question II.a. I: Who could be eligible entitles and/or Indirect recipients under the GHGRF?
Range of state, federally licensed, and non-profit capital deployment vehicles with reach into disadvantaged
communities; specific vehicles map to priority projects and unique needs of communities (non-exhaustive list)
State Green Banks /
Infrastructure Banks
State Housing Authorities
State Revolving Funds
(Clean Water, Clean Energy)
Tribes / Tribal Intermediaries
(Indian Energy Service Center)
Community Development
Financial Institutions
Credit Unions / LICU / Special
Purpose Credit Programs
Community Development
Banks
Minority Depository
Institutions
Nonprofit or Quasi-
Government Green Banks
Nonprofit Energy /
Conservation Funds
Nonprofit Social Impact Funds
Community Development or
Technology Accelerators
Potential to ask organizations from discrete financial sub-sectors to collaborate to create flexible capital stacks that meet the
unique needs of disadvantaged communities.
33
GHGRF Charge - Program Structure
Eligible Recipient(s)
Charge Question II. a.i: Who could be eligible entities and/or indirect recipients under the GHGRF?
Strategic Allocation of Capital Along Value-Chain of Activities
Fund Administration and
Reporting/Strategic
Allocation
Project Pre-Development
and Development Activities
i
Workforce Development/
Training/Capacity Building
1
Quantification,
Verification, O&M
Shared Service Platforms; Market Pre-Development Assistance;
Industry Support; Geographic Support
Co-Investment/Loans + Leverage for Commercial Capital
Capacity to leverage private sector capital to expand the reach of the program will be an important consideration.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 35
GHGRF Charge - Program Structure
Eligible Recipient(s): J EDI * Lens
Charge Question H.a.ii: What eligible entities and/or indirect recipients would best enable funds to reach disadvantaged communities?
What are their challenges and opportunities and how can EPA maximize the use of these channels?
To meet the conditions for what the GHGRF calls "low-income and disadvantaged communities" EPA could
give special attention and consideration to diverse representation in the leadership and structure of the
GHGRF direct and indirect recipients. This means that Black, Indigenous, and other People of Color (BIPOC)
leadership could be centered in the objectives and structures of the GHGRF.
o Two potential mechanisms: Special Purpose Credit Programs ("SPCPs") available for credit unions, including Low-
Income Designated Credit Unions (LICUs) and Minority Depository Institutions (MDIs).
¦ LICUs: To qualify as a LICU, a majority of the credit union's membership (50.01 percent) must meet certain low-income
thresholds, based on data from the Census Bureau and requirements outlined in the NCUA's Rules and Regulations (opens new
window).
¦ MDIs: An MDI may be a federally insured depository institution for which: (1) 51% or more of the voting stock is owned by
minority individuals; or (2) a majority of the board of directors is minority and the community that the institution serves is
predominantly minority.
*Justice, Equity, Diversity, and Inclusion (JED!)
GHGRF Charge - Program Structure
Eligible Recipient(s): JEDI Lens
Charge Question ll.a.ii: What eligible entities and/or indirect recipients would best enable funds to reach disadvantaged communities?
What are their challenges and opportunities and how can EPA maximize the use of these channels?
Special Purpose Credit Programs ("SPCPs") allow credit unions to offer product enhancements for the
benefit of economically disadvantaged classes of persons. SPCPs are explicitly authorized under the Equal
Credit Opportunity Act (ECOA) and Regulation B. ECOA's implementing regulation.
o Regulators recently have encouraged broader adoption of SPCPs to increase access to credit in underserved
communities, and HUD recently issued official guidance affirming that properly designed SPCPs, including SPCPs by
nonprofits for the benefit of economically disadvantaged classes, also are legal under the Fair Housing Act.
o Significant data and studies show that individuals and families of color have lower levels of homeownership. wealth.
and income than white individuals and families and that borrowers of color have diminished access to affordable
credit as compared to white borrowers (including for home-improvement loans and auto loans),
o Redlining-historical and current-has created and entrenched racial bias and systemic inequality into financial
systems, leading to economic disadvantage. Disparities extend beyond simply financial; disparities
in health, environmental quality, and access to energy-efficient technology also exist and reflect historical redlining
status. Neighborhoods of color also have less access to solar power than white neighborhoods.
Public data and reporting support that Americans and borrowers of color are economically disadvantaged as a class, and that
there are significant additional challenges that could in part be aided through access to clean energy financing and investment.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 36
GHGRF Charge - Program Structure
Eligible Recipient(s): JEDI Lens
Charge Question H.a.ii: What eligible entities and/or indirect recipients would best enable funds to reach disadvantaged communities?
What are their challenges and opportunities and how can EPA maximize the use of these channels?
Low-Income Credit Unions (LICUs)
Some credit unions are federally chartered (not-for-profit,
financial services cooperative) that provide loans for clean
energy and energy saving projects, such as electric
vehicles, electric Bicycles, residential solar electric
systems, residential geotnermal systems, and other green
home improvements.
Among these credit unions, some have also been
designated by the National Credit Union Administration
(NCUA) as a low-income credit union.
Some LICUs offer an SPCP that centers borrowers of color
and low-income borrowers.
The capacity of U.S. credit unions is over $1.8 trillion, so
there is ample space for scaling clean energy loans; for
example, one credit union has originated over 7.000 clean
energy loans totaling $110M+ without a single default as
of December 2022.
GHGRF Charge - Program Structure
Eligible Recipient(s): JEDI Lens
Charge Question ll.a.ii: What eligible entities and/or indirect recipients would best enable funds to reach disadvantaged communities?
What are their challenges and opportunities and how can EPA maximize the use of these channels?
1. 2021 American Green Bank Consortium Annual Report
2. CDFI Fund analysis 2020 Annual compliance report data
3. National Community Development Bankers' Association
4. Fitch Ratings; 2021 NCSHA State HFA Fact Book
5. Inclusiv.org
6. National Community Development Bankers' Association
7. Analysis of NCUA data on federally insured credit unions
These institutions are already embedded in LMI and
DAC communities; opportunity to transform
financial entities to prioritize decarbonization
activities and projects in their core strategies.
38
Minority Depository Institutions (MDIs)
MDIs serve communities that are disproportionately
impacted, physically and economically, by climate change.
MDIs are often the bank of last resort for consumers and
businesses underserved by traditional banks and financial
service providers.
In the United States, access to capital for individuals and
business owners is uneven based on race. The racial
wealth gap remains significant. In 2019, the median net
worth of a typical white household, $188,200, was 7.8
times greater than that of a typical Black household,
$24,100. (Brookings-Broady, McComas and Ouazad).
Some MDIs have already provided climate-friendly loans,
including:
o Developing and launching solar energy loans;
o Partnering with solar finance experts;
o Increasing capital flow to climate finance: purchasing
climate focused loans from other mission driven lenders;
and
o Increasing the interest and capacity of other MDIs in
climate friendly financing solutions.
Assets of mission-driven, low-income, and minority lenders (5 billions)
900.0
800.0
700.0
600.0
500.0
400.0
I
308
260
I
Greer Banks CDFI Loan Community State HFAs Community Non-CDFI Other Lc
Funds Development Developent Minority income ci
Banks Credit Unions Depository Union:
institutions
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 37
GHGRF Charge - Program Structure
Eligible Projects - Types of Projects / Sectors / Market Segments
Charge Question ll.b.i: What types of projects / sectors / market segments could EPA prioritize for funding through the eligible recipients?
To frame what types of projects could be considered,
need to understand where the problem is. How can it be
solved? Who will benefit? For example, assess the largest
sources, sectors, locations of GHG emissions to inform
consideration.
Where is the problem?
Total U.S. Greenhouse Gas Emissions
by Sector with Electricity Distributed
U.S. Environmental Protection Agency (2022). Inventory
of U.S. Greenhouse Gss Emissions and Sinks: 1990-2020
GHGRF Charge - Program Structure
Eligible Projects - Types of Projects / Sectors / Market Segments*
Charge Question ll.b.i: What types of projects/sectors/market segments could EPA prioritize for funding through the eligible recipients?
How can the problem be solved? Considerations may include project size, market gaps, GHG reduction capacity, scalability,
community reach and access, etc. List below includes representative examples (not comprehensive).
How can the problem be solved?
Transportation
Electric vehicles
Fleet conversions to EV
(buses, sanitation,
industrial / warehouse
transportation hubs)
¦Charging infrastructure
build-outs with focus on
industrial, rural, low-
income, and multi-
family housing
Bicycles
Reduced emission
filters for trucks
Buildings
Energy efficiency
Community solar
Rooftop solar
Other renewable
energy projects (e.g.,
wind, geothermal)
Community-scale
projects
Nonprofit facilities,
public facilities, tribal
facilities
Heat pumps
HVAC upgrades
Housing
Enable urgent repairs
prerequisite to
weatherization
Rooftop solar
Energy efficiency
oSingle family
o Multi-family
oAffordable housing
Community-scale
projects
Heat pumps
HVAC upgrades
Home battery storage
Agriculture /Rural
SME loans/ grants for
high efficiency
equipment
Soil / farm practices for
carbon capture
Forestry assets
Vertical farms
Biodigesters
Municipalities
Building upgrades
Energy efficiency
Solar projects on
municipal properties
(water infrastructure)
Tree canopy and
vegetation development
Green infrastructure
Technology
Adoption
Solar development
Batteries/storage
Hydrogen
Recycling solar modules
and batteries
* Integrated with GHGRF Charge Workgroup 1 (Objectives)
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 38
GHGRF Charge - Program Structure
Eligible Projects - Types of Projects / Sectors / Market Segments
Charge Question H.b.i: What types of projects / sectors / market segments could EPA prioritize for funding through the eligible recipients?
Who will benefit from solving the problem? List below includes representative examples (list not comprehensive).
Sector
Use Case (Examples)
Beneficiary (Examples)
Buildings - Residential
Energy efficiency
Community solar/wind
Rooftop solar
Electrification - cooking/heat
LMI
LMI
LMI
Tribes
Buildings - Commercial / Public
Energy efficiency upgrades
HVAC upgrades
Renewables
Nursing homes / churches / small business
Health centers, small business
All the above
Water Infrastructure
Water processing equipment upgrades
Alternative energy for utility infrastructure (net-metering)
Water consumers
Urban communities / LMIs
Agriculture
Climate-smart forestry
Biochar
Rural communities
Industry
Equipment upgrades
Tribal oil and gas assets - methane reduction
Tribal leasing for solar and wind
LMI communities exposed
Tribes
Transportation
Charging Infrastructure; fleet conversions - municipal, tribal
(e.g., school buses, sanitation trucks, public fleets)
Communities in and around industrial / warehouse areas
Users of public transport
GHGRF Charge - Program Structure
Eligible Projects - Types of Projects / Sectors / Market Segments
Charge Question ll.b.i: What types of projects / sectors/market segments could EPA prioritize for funding through the eligible recipients?
Targeted technical assistance, along the "value chain" of GHG activities to build the clean energy market segment (e.g., for
buildings/ solar/ energy efficiency to LMI communities).
Contractor/Installer /
Sola r Developer Capacity
Building
' Loans and equity for
business growth
1 Purchasing cooperatives
for equipment and
services
' Knowledge sharing
training, shared
documents, tools,
templates, networking
Workforce Development
Programs
> Train ing certificate
programs, on-the-job
train ing su pports
> For the installer /
contractor space
For project developers
(e.g., community solar
developers, real estate
asset managers, and
deve topers)
> For lenders
Community Outreach and
Customer Acquisition
1 Solarize and weatherize
campaigns
1 Social marketing and
education efforts
1 Sup port for
based planning efforts
and for community-
based organizations
seeking financial
ity-
Regulatory Reform
Supports
Incentives and support
for building energy
codes, community solar
enabling laws, and other
efforts to lower
regu latory barriers to
GHG abatement projects
(Knowledge-sharing
component to
complement "race to
the top" strategies)
Financial Assistance to
Achieve "Pre-requisites"
to Building Efficiency and
Clean Energy Retrofits
1 New roofs, new
e lectrical se rvices,
removal of outdated
wiring, etc.
Analysis, Planning, and
Contracting Assistance
fo r B ui Idi ng Own e rs
i information
infrastructure for
building owners to
access energy usage
data and benchmark
building performance
' Energy audits/ other
help to identify and
scope GHG abatement
opportunities
' Contractor vetting /
quality control
1 Assistance in lining up
rebates and incentives
1 Different programs
covering single-family
and multi-family /
commercial real estate /
community facilities
Lender Operating
Platforms
»Standardized loan
product designs and
documentation
Technical analysis and
review of proposed
e ne rgy im prove me nts;
contractor vetting and
quality control
> CRM / tech solutionsto
speed underwriting,
contractor / borrower /
lender interaction
»Credit enhancement and
secondary market
vehicles
Potential to ask organizations from sub-sectors to collaborate and form "clean energy hubs" - work with existing players at
national and regional levels + new or expanded players as needed. 4-
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 39
GHGRF Charge - Program Structure
Eligible Projects - Barriers, Gaps to Fill, and Strategies
Charge Question H.b.ii.l: What are the barriers to private sector capital?
Charge Question H.b.ii.3: What project-level gaps could the GHGRF fill for each type of project? What form could capital take to fill these gaps?
Barriers to Private Capital (H.b.ii.l)
Gaps GHGRF Could Fill (ll.b.ii.3)
Forms of Capital
Project Level:
Underwriting risk (payback period, return on investment,
revenue vs. cost)
Abi 1 ity to dem o nstrate e n e rgy savi ngs
Technical expertise
Fragmentation
Lack of track record
Quality control
Tenor (long-term)
Operations and maintenance
Pre-requisites (e.g., repairs)
Project development/supply chain
Scale (e.g., C-PACE)
On-bill financing resistance (utility)
Administrative resistance (PACE)
Tech n i ca 1 a ssista nee i n cl u d i ng [cost sa vi ngs a na lysis,
education, adoption requirements, etc.]
Pre-condition assistance including [grants for home
repairs enabling weatherization]
Clean energy loans - single family, multi-family,
commercial
Energy efficiency loans
Revol vi ngloanfunds
EV auto loans
Unsecured loans
Blended finance
Equipment and appliance loans (e.g., HVAC, energy
efficient appliances)
C-PACE loans (Commercial Property Assessed Clean
Energy loans)
Tariff on-bill repayment loans
Pay-for-performance contracting mechanisms
Borrower Level:
Credit risk
Ability to repay
Uptake
Adoption
Split incentives (tenant / owner)
Market development assistance including
[information campaigns, available incentives,
community programs]
Funding collaboration development Including [local
funding campaigns, community wide pools, etc.]
Provides access to financial products across all
borrower types and levels the playing field
Green mortgages
Small business loans
Capital provider:
Balance sheet equity
Lack of loan servicing platform
Lack of shared services (e.g., IT, insurance)
Lack of credit enhancements
Lack of climate impact reporting infrastructure
Balance sheet equity
Credit enhancements: Loan loss reserves, interest
rate buy-downs, guarantees
Technical assistance
43
GHGRF Charge - Program Structure
Eligible Projects - Barriers, Gaps to Fill, and Strategies
Charge Question ll.b.ii.4: Beyond assembling the capital stack for a deal, what other barriers and constraints exist that could constrict the
pipeline of successful projects? What program strategies are needed to respond to these barriers and constraints?
Barriers, examples, and strategies listed below are representative examples (not comprehensive).
Barrier
Project Examples
Strategies
Uptake - See LBNL study on driving demand
for home improvements
Home improvements
Community-level programs
Interest - Commercial building owner
Energy efficiency, renewable energy, HVAC
upgrades, C-PACE
Demonstrated interest, commitment, or
pipeline before funding program established
Prerequisites
Home needs basic repairs (e.g., new roof)
before energy efficiency upgrades would
be viable
Commercial building needs basic energy
efficiency upgrades before solar would be
viable
Coordination with State Energy Offices/ SEP,
pre-development support
Scale-Aggregate impact
Fleet conversions
Systemic programs, collaboration with
government agencies
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 40
GHGRF Charge - Program Structure
Structure of Funding - Design Requirements
Charge Question ll.c.i: How could EPA address these issues through program design?
Tier 1 Recipients
[National / Regional]
Beneficiaries
Tier 2 Recipients
[Value-Chain Aligned]
Six (6) Priority Approaches:
(i) States / Municipalities / Tribes
(ii) National Green Bank I Fund
(iii) Collective Action - Regional
(iv) Collective Action - Sectoral
(v) Lender Intermediaries
(vi) Combination of Structures
Tier 2 shows strong alignment of critical pieces of
the GHG reduction distribution chain (systemic approach).
Pipeline Development
Project Development
Project Operations
and Maintenance
Address social, economic, financial gaps (GHGRF)
*
Require private capital commitments (1:1)
EPA has an opportunity to create program structures that address barriers and directly support scaled deployment
across defined value chains, with emphasis on filling gaps that prohibit expansion and benefits to low-income communities.
GHGRF Charge - Program Structure
Structure of Funding - Compliance and Streamlining
Charge Question ll.c.i: How could recipients comply with relevant federal requirements?
This workgroup reviewed and discussed this question at a high level and in coordination with the other GHGRF charge
workgroups.
Charge Question ll.c.i: How can EPA streamline the distribution of funds so that applicable federal and state review can be accomplished in a
coordinated and efficient manner?
¦ Evaluating pros / cons (strengths / weaknesses) of a range of potential options.
Options include potentially one, few, or many direct recipients:
o States/Municipalities/Tribes;
1. State Green Banks / Infrastructure Funds/ Bond Funds.
2. State Clean Water Revolving / Clean Energy Funds.
3. Tribal Entities / Indian Energy Service Centers / Branch of Tribal Climate Resilience.
o [Single Entity] National Green Bank / Fund;
o Multiple potential recipients; and
1. Green Funds.
2. Collective Action - Regional.
3. Collective Action-Sectoral.
4. Lender Intermediaries.
o Mixed approach {combination of above).
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 41
GHGRF Charge - Program Structure
Evaluation of Structure Options
Focus on six (6) major potential structure options:
1) States / Municipalities / Tribes;
2) [Single Entity] National Green Bank / Fund;
3) Collective Action - Regional;
4) Collective Action - Sectoral;
5) Lender Intermediaries; and
6) Combination of Structures.
Strengths and weaknesses of each option based on proposed design requirements.
47
GHGRF Charge - Program Structure
1) States / Municipalities / Tribes
Strategy: Solicit competitive proposals from states, municipalities, and tribes and/or allocate funding based on
an EPA-established distribution methodology to qualified applicants.
States / municipalities / tribes would then redeploy funds to other eligible recipient(s), indirect recipient(s), and for
technical assistance, and perhaps directly to projects.
Ask applicant(s) to:
¦ Describe how they will allocate GHGRF funds across their state / municipality/ tribe.
Leverage existing state / municipal / tribal organizations and capacities.
Underscore how funds will be directly invested in, address barriers to, and/or benefit specific disadvantaged
communities in the state / municipality / tribe.
Demonstrate success with deploying capital and innovation that drives additionality in GHG funding and reductions.
EPA Methodology:
EPA could manage award from the federal level, potentially with internal teams providing first-level review in relation
to requirements and rankings, and expert panels providing second-level review.
EPA could use a hybrid award model (like WIFIA) that would create an allocation methodology, with funding
contingent upon meeting qualifications and conditions under the competitive award process.
48
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 42
GHGRF Charge - Program Structure
1) States / Municipalities /Tribes
Strengths / Rationale
Equitable access to funds for qualified applicants.
Public and transparent process to capital distribution.
State-level expertise addresses unique needs of each
state related to LMI, GHG reductions, leverage, etc.
Many states have well established infrastructure to
address GHG solutions (e.g., State Green Banks).
Some tribal fund mechanisms exist that are better
equipped to deal with tribal dynamics.
Some states have preexisting state-wide GHG reduction
laws and funds that can be leveraged.
Preexisting state infrastructure does not have to be
created and could be utilized in the first 180 days to
ensure expeditious distribution of funds.
Weaknesses / Challenges
The competitive application process may disadvantage
states/ municipalities /tribes where political priorities
don't align with statute.
¦ Limits coordination across regions and sectors that could
strengthen outcomes.
Some states have much less existing infrastructure to
receive and distribute funds to disadvantaged
communities.
There may be differences in definitions between federal
and state laws.
GHGRF Charge - Program Structure
2) National Green Bank / Fund
Strategy: Solicit competitive proposals from entities to create and manage a single National Green Bank / Fund.
The National Green Bank / Fund would then redeploy funds to other eligible recipient(s), indirect recipient(s), and for
technical assistance, and perhaps directly to projects as well.
Ask applicant(s) to:
Describe how they will allocate GHGRF funds across the country along a value chain that leads to robust project
implementation.
Detail how funds would address GHG reduction objectives at scale through leveraging existing relationships, organizations
and capacities on a national scale.
Underscore how funds will be directly invested in, address barriers to, and/or benefit disadvantaged communities on a
national scale.
Demonstrate success and efficiency with deploying capital and innovation that drives additionality in GHG funding and
reductions.
Describe how they will retain, manage, recycle, and monetize repayments to ensure continued operability at a national
scale.
EPA Methodology:
EPA could manage award from the federal level, potentially with internal teams providing first-level review in relation to
requirements and rankings, and expert panels providing second-level review.
EPA may impose sub-awardee criteria consistent with applicable guidelines.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 43
GHGRF Charge - Program Structure
2) National Green Bank / Fund
Strengths / Rationale
Weaknesses / Challenges
Reduced administrative burden to EPA through
centralized management.
Agreements with the funded entity could be structured
to provide flexibility over time, allowing shifts in strategy.
Provides broadest level of ability for the intermediary to
claw back funds and redistribute them, including across
regions and sectors, to the best opportunities.
Probably the strongest structure to administer a "race to
the top" strategy (inter-state competition based on
regulatory reforms) over time.
Broad network of other eligible recipient(s) currently
exist for downstream allocation.
Elevated management challenge and longer ramp-up
time to operationalize.
Potential multiple layers of intermediation before funds
flow to end users.
Concentration of funds in one entity elevates financial
management and political risks.
Broad scope could create challenges in planning across
the whole value chain for all sectors, engaging
stakeholders broadly, responding to individual
communities.
Requires new capacity / entity to address the broad remit
and requirements, which could delay timely distribution
of funds.
GHGRF Charge - Program Structure
3) Collective Action - Regional
Strategy: EPA could set forth a pot of funding for regional approaches by either designating a set of regions (could be
EPA regions or other) or by seeking regional partnerships as determined by the applicant(s).
Ask to see applications from partners within the regions (e.g., lead eligible recipient together with indirect recipient(s),
technical assistance providers, other key players).
Amounts to a series of "regional coordinators " to support GHGRF deployment.
Ask applicant(s) to:
Identify regional opportunities, barriers, and priorities for GHG reduction.
Describe how the regional partnership would work together to implement a comprehensive strategy responding to regional
needs and interests, including on-the-ground delivery of projects and O&M.
Describe how the initiative would be quarterbacked.
Address how funds would address specific GHG reduction objectives and barriers within its regional footprint.
Underscore how funds will be directly invested in, address barriers to, and/or benefit disadvantaged communities.
Demonstrate success with deploying capital and innovation that drives additionality in GHG funding and reductions.
Describe how they will retain, manage, recycle, and monetize repayments to ensure continued operability.
EPA Methodology:
EPA could fund at least one application per region.
EPA could specifically request applications from regions that are underserved or lack capacity.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 44
GHGRF Charge - Program Structure
3) Collective Action - Regional
Strengths / Rationale
Weaknesses / Challenges
Encourage applicant(s) to think about all the partnerships
needed to leverage resources, build a robust project
pipeline, and ensure that strong implementation capacity
is in place.
Narrowed geographic focus allows for deeper thinking
and a more tailored approach to regional needs.
Still allows EPA to manage a more limited number of
regions.
Potential identification of community-level collaborations
within regions.
If aligned with EPA regions, potentially some ease of
administration for EPA using regional offices.
Regional intermediary could exercise clawback at
regional level to re-allocate among regional entities.
Requires potential new capacity or entity to address the
"collective action" requirements.
Some structures might be better supported at a national
scale (e.g., secondary market infrastructure, operating
platforms for lenders).
Management of strategies across different sectors within
a region would still be complex and lack consistency and
standardization.
Some EPA regions are not ideally drawn for easy regional
collaboration (e.g.. Region 2 - NY, NJ + PR / USVI).
GHGRF Charge - Program Structure
4) Collective Action - Sectoral
Strategy: EPA would ask applicant(s) to propose a strategy to address a particular sector (e.g., multifamily housing,
single-family home retrofits, EVs, community solar).
Examine barriers and opportunities related to the value chain of activities to generate GHG reductions including funding and
financing, consumer demand generation, training / technical assistance / capacity-building needs, workforce development
and supply chain issues; Variant: EPA could invite sectoral collective applications within specific regions (such that the total #
of applications funded = # of funded sectors x# offunded regions).
Ask applicant(s) to:
Pull together partnerships with all the stakeholders needed to address the value chain within a sector ("build the
ecosystem").
Define sector(s), focus on financing needs and non-financing barriers.
Describe how funds would address GHG reduction objectives within its sector and timelines.
Underscore how funds will be directly invested in, address barriers to, and/or benefit disadvantaged communities.
Demonstrate success with deploying capital and innovation that drives additionality in GHG funding and reductions.
Describe how they will retain, manage, recycle, and monetize repayments to ensure continued operability.
EPA Methodology:
EPA could define sectors and fund at least one application per sector (e.g., low-income housing, commercial buildings, water
infrastructure, agriculture, industry, transportation).
Independent sector experts could serve on selection committees.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 45
GHGRF Charge - Program Structure
4) Collective Action - Sectoral
Strengths / Rationale
Weaknesses / Challenges
Promotes innovative thinking and collaboration across
the whole value chain - demand generation, pipeline
creation, implementation, O&M.
EPA could make determinations about certain sectors
where it wants to make larger investments / perceives
greater opportunities.
National sectoral strategies would still need to account
for differences from region to region (e.g., different
regulatory regimes, electricity pricing and markets,
climate factors in building design).
¦ Not that many truly national players with a focus on one
specific sector, although there are some.
Greater possibility to build platforms that facilitate
investment in a specific sector (e.g., Smart-E for single
family housing energy retrofits).
Going to a sectors-by-regions approach increases the
number of funded applications and EPA management
challenges.
Several entities are well positioned to run a sector-based
approach.
Focus on sectors may limit types of solutions.
55
GHGRF Charge - Program Structure
5) Lender Intermediaries
Strategy: Channel money to green lending programs through existing and established intermediaries.
Ask applicant(s) to:
Describe the existing network of lending organizations they are supporting and the strategies these organizations are
using to finance GHG reduction.
Demonstrate the strength and nature of that intermediary's relationship with the organizations in the network.
Detail sectors and geographies served.
Show track record of engagement in low-income communities and green lending.
Provide network-wide leverage, financing deployment, and GHG reduction goals and supports that would be
provided (e.g., TA, training, capacity building) to both lenders and other key players in the value chain.
Demonstrate success with deploying capital and innovation that drives additionality in GHG funding and reductions.
Describe how they will retain, manage, recycle, and monetize repayments to ensure continued operability.
EPA Methodology:
EPA could issue awards to select intermediaries targeting a specific financial sector.
Eligibility for secondary recipient(s) could be tied to sector specialization.
56
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 46
GHGRF Charge - Program Structure
5) Lender Intermediaries
Strengths / Rationale
Weaknesses / Challenges
Easily the fastest time to market of any of the options
discussed here - the intermediaries and their network
relationships already exist.
Relatively low administrative burden to EPA - fund four
(4) or five (5) intermediaries.
Provides ability for the intermediaries to claw back
unused funds and redistribute them, within network, to
the best performers.
Diversifies risks compared to funding a single applicant.
Individual lenders could have flexibility to make plans
tailored to the specific sectors and communities they
serve and stakeholders they partner with.
Has the potential for fragmentation in terms of inability
to encourage lenders of different stripes to work
together.
Challenge to ensure that lenders invest adequately in
other value chain supports (e.g., TA or capacity building
for communities, clean energy project developers).
The broad scope of activities in any given lender network
could create challenges in planning and coordination at
the network intermediary level.
Current intermediaries have not operated at the scale
required for the GHGRF; therefore, there's some
management and execution risk with ramping up capacity
and capabilities.
GHGRF Charge - Program Structure
6) Combination of Structures
Strategy: EPA could allocate portions of the GHGRF for national, state, regional, sectoral, and direct solutions.
Competition would occur within each.
Structure would examine barriers and opportunities along the GHG value chain, including financing, consumer demand
generation, training / technical assistance / capacity-building, workforce development, and supply chain issues.
Ask applicant(s) to:
Pull together partnerships with all the stakeholders needed to address the value chain in each specific structure.
Focus on financing needs and non-financing barriers.
Define focus in state / region / sector.
¦ Detail how funds would address GHG reduction objectives within its targeted footprint (national, regional, state, sector).
Underscore how funds will be directly invested in, address barriers to, and/or benefit disadvantaged communities.
Demonstrate success with deploying capital and innovation that drives additionality in GHG funding and reductions.
Describe how they will retain, manage, recycle, and monetize repayments to ensure continued operability.
EPA Methodology:
EPA could fund a cohort of applicant(s) with each major structure represented.
Independent experts could serve on selection committees for each type of program.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 47
GHGRF Charge - Program Structure
6) Combination of Structures
Strengths / Rationale
Reduces risk by distributing funds across a broader
universe of participants (portfolio effect).
Promotes innovative thinking and collaboration across
the whole value chain - demand generation, pipeline
creation, implementation, O&M.
Allows EPA determinations about certain sectors and
regions with opportunities for larger or more critical
capacity investments.
Creates balance of scale while ensuring underserved
communities are represented in the process.
Greater possibility to build platforms that facilitate
investment in a specific region or sector without
sacrificing national-level capacity.
Several entities are well positioned to compete in one or
more priority structure pools.
Weaknesses / Challenges
Increases total number of funded applications and EPA
management challenges.
Trade-off between EPA challenge in program oversight
and fund allocation versus risks to concentration of funds
in a single entity.
GHGRF Charge - Program Structure
Potential Design Requirements - EPA Matrix
Charge Question Are there any potential program design requirements that would impact the ability of recipients to use
the GHGRF program funds ?
Potential Program Design Requirements*
Federal funding requirements
Strengths / Rationale
Reasons these work
Weaknesses/ Challenges
Reasons these are burdens
Financial capacity to manage funds
Governance
Metrics / reporting systems
Due diligence expertise
Capacity to provide grants / debt / equity / credit
enhancements
Collective action systemic change
Sector expertise
Technology expertise
Community access / LMI reach
GHG reduction capacity
Leverage private capital
'Assessed in alignment with GHGRF Charge Workgroups 1 (Objectives) and 3 (Execution, Reporting, and Accountability)
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 48
GHGRF Charge - Program Structure
Thank You!
EFAB GHGRF Charge - Program Structure Workgroup
Name
Affiliation
Location
Sector
Lori Collins (co-chair)
Owner and Principal, Collins Climate Consulting
Charlotte, NC (EPA Region 4)
Business - Industry
Ashley Allen Jones (co-chair)
Founder and Chief Executive Officer, \2 Capital
Washington, DC (EPA Region 3)
Business - Financial Services
Stacy Brown
President and Chief Executive Officer, Freberg Environmental, Inc.
Denver, CO (EPA Region 8)
Business - Financial Services
Jeff Diehl
Chief Executive Officer, Rhode Island Infrastructure Bank
Providence, Rl (EPA Region 1)
State / Local Government
Eric Hangen
Senior Research Fellow, Center for Impact Finance, Carsey School of Public
Policy, University of New Hampshire
Danby, VT (EPA Region 1)
Academic
Craig Holland
Senior Director of Urban Investments, The Nature Conservancy
Arlington, VA (EPA Region 3)
Environmental / Non-
Governmental Organization
Craig Hrinkevich
Public Finance Team - New Jersey Managing Director, Robert W. Baird &
Company, Inc.
Red Bank, NJ (EPA Region 2)
Business - Financial Services
Margot Kane
Chief Investment Officer, Spring Point Partners LLC
Philadelphia, PA (EPA Region 3)
Business - Financial Services
George Kelly
Global Client Strategy Officer, Earth Recovery Partners
Denver, CO (EPA Region 8)
Business - Financial Services
Lawrence Lujan
Executive Director, Taos Pueblo Utility Service
Taos, NM (EPA Region 6)
Tribal Government
Marilyn Waite
Managing Director, Climate Finance Fund
Washington, DC (EPA Region 3)
Business - Financial Services
Gwen Yamamoto Lau
Executive Director, Hawaii Green Infrastructure Authority
Honolulu, HI (EPA Region 9)
State / Local Government
61
Execution, Reporting, and Accountability Workgroup
62
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 49
GHGRF Charge - Execution, Reporting, and Accountability
Workgroup Overview
This workgroup was asked to provide considerations around the GHGRF's
execution, reporting, and accountability, including how to meet key deadlines.
Short-Term - Now through February 12, 2023 (180-day requirement)
Hold stakeholder engagement strategy, including EFAB input and public request for information
Identify award priorities and weights
Develop application review structure
Develop appropriate recipient(s) terms and conditions
Identify metrics for success - from application to post-implementation
Create guardrails for responsible implementation and oversight of funding
Medium-Term - February 13, 2023 to September 30, 2024 when funds expire
Make funding selection(s); award, obligate, and initiate funding
Establish milestones and mechanisms for timely deployment of funds
Ensure timely reporting and compliance requirements are being met
Establish a program audit schedule
Ensure all appropriated funds are awarded by September 30,2024
Long-Term October 1, 2024 and Beyond
Ensure timely deployment of funds
Ensure idle funds are redirected to high-performing recipient(s) and/or impactful projects
Ensure implementation milestones, performance metrics, and compliance requirements are being met
Conduct ongoing program audits to ensure funds are being used as intended by direct recipierrt(s)to indirect recipient(s) and eligible projects
GHGRF Charge - Execution, Reporting, and Accountability
Identify Award Priorities and Weights - $7B (States /
Municipalities / Tribes*)
1. State, municipal, or tribal finance authorities in existence or enabling legislation to
create a finance authority.
Extra points for agencies with a track record of financing GHG reduction technologies.
2. Existing clean energy and other GHG reduction financing programs.
Extra points for existing financing programs that benefit low-income / disadvantaged communities.
Extra points for existing residential rooftop solar financing programs.
3. Existing technical assistance and outreach being conducted.
Extra points if technical assistance and outreach are being conducted in low-income / disadvantaged communities.
4. Feasible plan for timely deployment of funds.
Extra points for collaboration with relevant public and private partners (e.g., cities, counties, community-based
organizations, technical assistance providers).
*EPA may consider creating a separate funding bucket for Tribes.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 50
GHGRF Charge - Execution, Reporting, and Accountability
Identify Award Priorities and Weights - $12B
1. Ability to provide financial assistance to qualified projects at national, regional, state, and local levels.
Extra points for an existing entity with a historical track record of deploying funds nationwide.
Extra points for having a network of sub-recipient(s) nationwide.
Extra points for having a network of sub-recipient(s) with a track record of financing GHG reduction technologies.
Extra points for having a network of sub-recipient(s) with existing financing programs that benefit low-income / disadvantaged
communities.
Extra points for having a network of sub-recipient(s) that have a track record of making investments in qualified projects that would
otherwise lack access to financing.
Extra points for having a network of sub-recipient(s) that have a track record of leveraging public funds.
2. Ability (or feasible plan) to retain, manage, recycle, and monetize repayments and revenue to ensure
continued operability.
Extra points for an existing entity that manages, recycles, and monetizes repayments.
3. Provide funding and technical assistance to establish new or support existing public, quasi-public, not-for-
profit, or nonprofit entities.
Extra points for having a track record of establishing or supporting new/existing public, quasi-public, not-for-profit, or nonprofit low-
income focused lenders and capital providers.
4. Feasible plan for timely deployment of funds.
Extra points for collaboration with relevant public and private partners (e.g., states, green banks, CDFIs, technical assistance providers).
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GHGRF Charge - Execution, Reporting, and Accountability
Identify Award Priorities and Weights - $8B
1. Ability to provide financial assistance to qualified projects at national, regional, state, and local levels in
low-income / disadvantaged communities.
Extra points for an existing entity with a historical track record of deploying funds nationwide in low-income / disadvantaged
communities.
Extra points for having a network of sub-recipient(s) nationwide focused in low-income / disadvantaged communities.
Extra points for having a network of sub-recipient(s) with existing financing programs that benefit low-income / disadvantaged
communities.
Extra points for having a network of sub-recipient(s) with a track record of financing GHG reduction technologies in low-income /
disadvantaged communities.
Extra points for having a network of sub-recipient(s) that have a track record of making investments in qualified projects that would
otherwise lack access to financing in low-income / disadvantaged communities.
Extra points for having a network of sub-recipient(s) that have a track record of leveraging public funds.
2. Ability (or feasible plan) to retain, manage, recycle, and monetize repayments and revenue to ensure
continued operability.
Extra points for an existing entity that manages, recycles, and monetizes repayments.
3. Provide funding and technical assistance to establish new or support existing public, quasi-public, not-for-
profit, or nonprofit entities.
Extra points for having a track record of establishing or supporting new/existing public, quasi-public, not-for-profit, or nonprofit low-
income focused lenders and capital providers.
4. Feasible plan for timely deployment of funds.
Extra points for collaboration with relevant public and private partners (e.g., states, green banks, CDFIs, technical assistance providers).
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 51
GHGRF Charge - Execution, Reporting, and Accountability
Develop Application Review Structure - $7B (States /
Municipalities / Tribes)
1. EPA to review and score applications based on priorities and weights previously identified (for
the $7B bucket).
2. Funding awarded based on total points scored (including feasibility of implementation and
deployment plan).
3. Unawarded funds could remain available for additional applications until September 1, 2024,
or be available for reallocation.
4. On September 30,2024, any remaining unawarded funds could be awarded to an eligible
recipient(s) capable of awarding unused funds to states, municipalities, and tribes on an
ongoing, competitive basis.
The money stays in its intended bucket.
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GHGRF Charge - Execution, Reporting, and Accountability
Develop Application Review Structure - $20B
1. EPA to review and score applications based on priorities and weights previously identified (for
the $12B and $8B buckets).
2. Funding awarded based on total points scored (including feasibility of implementation and
deployment plan).
3. Unawarded funds (if any) could remain available for additional applications until September 1,
2024.
4. On September 30,2024, any remaining unawarded funds could be awarded to the eligible
recipient(s) with the highest reporting metrics for success as of August 31, 2024.
The money stays in its intended bucket.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 52
GHGRF Charge - Execution, Reporting, and Accountability
Develop Appropriate Recipient Terms and Conditions
Incorporate positive and negative covenants to ensure compliance in award documents.
Incorporate a mechanism in award documents that triggers underperforming eligible recipient(s)
with idle, undeployed funds to transfer unused funds to high performing eligible recipient(s) in
need of additional funding.
Explore existing federal templates and best practices used to evaluate program effectiveness.
Reference lessons learned from other existing federal programs to reduce obstacles in assisting
and deploying funds into low-income and disadvantaged communities.
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GHGRF Charge - Execution, Reporting, and Accountability
Lessons Learned from EPA Clean Water State Revolving Funds -
Section 319 Exemptions
Section 319 of the Clean Water Act was established in 1987 to address nonpoint source pollution. EPA
awards funding to states with a Nonpoint Source Management Program. NY and PA established energy
efficiency and renewable energy loans as eligible for CWSRF support under Section 319.
Most of the projects funded by CWSRFs are large - in the tens of millions of dollars - and are appropriately
subject to a variety of federal requirements.
For residential energy efficiency and non-utility scale clean energy projects, such requirements are
impractical and cost prohibitive. Over the past 30 years, EPA has issued guidance that exempts Section 319
projects from many such requirements, enabling the CWSRF program to fund a variety of nonpoint source
projects that would have been impossible without such exemptions.
Section 319 exemptions include:
o American Iron and Steel provision;
o National Environmental Policy Act (NEPA); and
o Davis-Bacon Act.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 53
GHGRF Charge - Execution, Reporting, and Accountability
Identify Metrics for Success - From Application to Post-
Implementation
Metrics for success, published in an Annual GHGRF Summary Report of eligible recipient(s), may include:
Total GHG emissions avoided (estimated metric tons C02).*
o GHG emissions avoided in low-income / disadvantaged communities (# and % of total),
o GHG emissions avoided in non-low-income / disadvantaged communities (# and % of total).
Total funding awarded to eligible recipient(s).
o Total funding ($ and %) deployed and invested in low-income / disadvantaged communities,
o Total funding ($ and %) deployed and invested in non-low-income / disadvantaged communities,
o Total funding ($ and 96) deployed to indirect recipient(s).
Total funding expended by indirect recipient(s).
o $ and % of funds deployed and invested in low-income / disadvantaged communities.
¦ Number of LMI households served.
¦ Estimated energy savings for LMI households.
o $ and % of funds deployed and invested in non-low-income / disadvantaged communities.
Total leverage achieved.
o $ and % of leverage (total $ value of projects completed / total $ of GHGRF deployed) in low-income / disadvantaged communities,
o $ and % of leverage (total $ value of projects completed / total $ of GHGRF deployed) in non-low-income / disadvantaged communities.
Continued operability - Self-sufficiency ratio (earned income / total expenses) for eligible recipients.
Number of jobs created or retained (EPA may choose to adopt SBA's jobs created / retained metric).
Energy savings metrics.
*GHG avoided may be reported for Year 1 as well as for life of the system. Recognizing that some investments will unfold over a longer time
period, tracking metrics and trends over a longer timeframe may be required.
GHGRF Charge - Execution, Reporting, and Accountability
Responsible Implementation and Oversight of Funds - $7B
Timely deployment of funds to eligible recipient(s) (states, municipalities, tribes, and eligible recipient(s)).
o Direct recipient investments into qualified GHG reduction projects benefitting low-income / disadvantaged communities in the form
of loans.
o Direct recipient investments into low-income /disadvantaged communities in the form of grants, other forms of financial assistance,
and technical assistance.
o Direct recipient deployment to indirect recipient(s).
¦ Indirect recipient investments in qualified GHG reduction projects benefitting low-income / disadvantaged communities in the form of
grants, loans, or other forms of financial and technical assistance.
* Compliance to ensure investments into low-income / disadvantaged communities benefit them and are not merely
located there (e.g., utility scale solar farm located in a low-income / disadvantaged community).
Community accountability.
o Diverse board composition.*
o Historical track record and clean energy expertise to deploy funds to reduce GHG emissions in low-income / disadvantaged
communities.
* Transformative application of funds.
o Inclusive and non-traditional underwriting and structuring to reach deeper to benefit low-income / disadvantaged communities
previously locked out of GHG reduction financing / investments.
*Where practicable as it may be difficult for government agencies to achieve as directors may be statutorily appointed.
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 54
GHGRF Charge - Execution, Reporting, and Accountability
Responsible Implementation and Oversight of Funds - $12B
Timely deployment of funds to eligible recipient(s) (non-depository nonprofit organization(s)).
o Direct recipient investments into qualified GHG reduction projects at the national, regional, state, tribal,
and/or local levels.
o Eligible recipient(s) to prioritize investments in qualified projects that would otherwise lack access to
financing.
o Eligible recipient deployment to indirect recipient(s).
¦ Indirect recipient investments in qualified GHG reduction projects.
o Indirect recipient investments in the form of funding and technical assistance to establish new or support
existing public, quasi-public, not-for-project, or nonprofit entities that provide financial assistance to qualified
projects.
Historical track record and clean energy expertise to deploy funds to reduce GHG emissions.
Transformative application of funds.
o Financing mechanisms or structures to attract private capital to leverage funds.
o Number of new green lending organizations established / supported.
¦ Long-term sustainability of green lending organizations receiving GHGRF support.
o Fiscally responsible fund deployment to ensure continued operability [of GHGRF funds].
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GHGRF Charge - Execution, Reporting, and Accountability
Responsible Implementation and Oversight of Funds - $8B
Timely deployment of funds to eligible recipient(s) (non-depository nonprofit organization(s)).
o Direct recipient investments into qualified GHG reduction projects benefitting low-income / disadvantaged communities at the national,
regional, state, tribal, and/or local levels,
o Eligible recipient(s) to prioritize investments in qualified projects that would otherwise lack access to financing,
o Eligible recipient deployment to indirect recipient(s).
¦ Indirect recipient investments in qualified GHG reduction projects benefitting low-income / disadvantaged communities.
o Indirect recipient investments in the form of funding and technical assistance to establish new or support existing public, quasi-public, not-for-
project, or nonprofit entities that provide financial assistance to qualified projects.
Compliance to ensure investments into low-income/ disadvantaged communities benefit them and are not merely located there
(e.g., utility scale solar farm located in a low-income / disadvantaged community).
Community accountability.
o Diverse board composition.*
o Historical track record and clean energy expertise to deploy funds to reduce GHG emissions in low-income / disadvantaged communities.
Transformative application of funds.
o Inclusive and non-traditional underwriting and structuring to reach deeper to benefit low-income / disadvantaged communities previously
locked out of GHG reduction financing / investments,
o Financing mechanisms or structures to attract private capital to leverage funds,
o Number of new green lending organizations established / supported.
¦ Long-term sustainability of green lending organizations receiving GHGRF support.
o Fiscally responsible fund deployment to ensure continued operability [of GHGRF funds].
*Where practicable as it may be difficult for government agencies to achieve as directors may be statutorily appointed
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 55
GHGRF Charge - Execution, Reporting, and Accountability
How to ensure GHG emission reductions?
Accountability Strategy
Considerations for EPA
Application Guardrails
* Technical knowledge of applicant team @ GHG abatement tech
"Systems change" approach of applicant to achieve scaled impacts
* Finance expertise of applicant team
* Scale of customer relationships / line of sight to GHG projects of applicant team
Federal Requirements
How requirements may impact contractor availability for smaller jobs than nonetheless could scale in the
aggregate to significant abatement
Governance
~ Institute minimum GHG reduction metrics per $X.XX on the "award level" (not project level) to ensure
funds are being deployed as intended - keep in mind time lag to impact for some investments
Reporting / Metrics
Provide a consistent and understandable methodology to help recipient(s) and subgrantee(s) accurately
estimate GHG impacts
Consider when to use "deemed" estimates vs. modeled, measured
Consider award-level instead of project-level performance measurement (across a grantee's portfolio of
investments)
Clawback/ Redistribution
« How application structure / role of intermediaries enhances or limits the ability to redistribute funding
from underperforming to higher-performing sector(s) or organization(s)
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GHGRF Charge - Execution, Reporting, and Accountability
How to ensure accountability to low-income and
disadvantaged communities?
Accountability Strategy
Considerations for EPA
Application Guardrails
Track record / expertise of applicant(s) in serving LMI and DAC communities
Depth of private-public partnerships, including community-based organizations
Federal Requirements
EPA needs to comply with Federal law; however, these requirements may negatively impact the ability of
LMI and DAC-serving projects to be implemented
To facilitate projects benefiting low-income / disadvantaged communities, EPA could adopt waivers and
exemptions currently used by EPA and other federal agencies (e.g., EPA Section 319: American Iron & Steel
provision and NEPA & Davis-Bacon exemptions; USDA RESP: "Buy-American" Requirement (7 CFR Part
1787); NEPA Categorical Exclusions (7 CFR Part 1970 Subpart B); and waiver of Davis-Bacon requirement)
Governance
As practicable. Board representation from LMI and DAC communities on recipient and indirect recipient /
subgrantee organization(s)
Subsequent award funding dependent on investments benefitting low-income/ disadvantaged
communities
Reporting / Metrics
Metrics to capture meaningful co-benefits to communities such as job creation, energy savings, wealth
building
Metrics to track number and $ value of projects serving/ benefiting (not just "in") LMI communities
Clawback / Redistribution
How application structure / roles of intermediaries enhances or limits the ability to redistribute funding
from underperforming to higher-performing sector(s) or organization(s)
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 56
GHGRF Charge - Execution, Reporting, and Accountability
How to ensure leveraging and recycling of the grants?
Accountability Strategy
Considerations for EPA
Application Guardrails
Financial capacity / track record of recipient organization(s)
Finance expertise of recipient(s) / indirect recipient(s) and subgrantee(s)
Federal Requirements
« Establish minimum and target program leverage requirements (recycled funds can be leveraged multiple
times) on the award level:
o Minimum: With initial funding
o Target: By September 30, 2031
Governance
Subsequent award funding dependent on achievement of leverage metric milestones
Reporting / Metrics
* Define a consistent measure for leverage (e.g., GHGRF $ / total project costs funded)
Consider how leverage may also happen at multiple levels
Take the long view: Consider how capacity-building investments in a defined value chain may ultimately
unlock larger volumes of investment than focusing on levering capital for "shovel-ready" projects
Clawback/ Redistribution
How application structure / roles of intermediaries enhances or limits the ability to redistribute funding
from underperforming to higher-performing sector(s) or organization(s)
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GHGRF Charge - Execution, Reporting, and Accountability
How to ensure additionality of projects?
Accountability Strategy
Considerations for EPA
Application Guardrails
Types of projects that applicant(s) propose to invest in (EPA could encourage / prioritize applications
focusing on project types it thinks are most additional)
Finance expertise of applicant team (ability to ID project not needing subsidy)
Federal Requirements
How requirements might help to avoid funding projects with negative environmental impacts
How requirements might create costs
Governance
Reporting / Metrics
Additionality is difficult to report / confirm directly; consider proxies (such as project types or community
types that historically are challenged to access capital)
Clawback / Redistribution
How application structure / roles of intermediaries enhances or limits the ability to redistribute funding
from underperforming to higher-performing sector(s) or organization(s)
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Environmental Financial Advisory Board Meeting, Dec. 15, 2022 | 57
GHGRF Charge - Execution, Reporting, and Accountability
How to promote continued operability?
Accountability Strategy
Considerations for EPA
Application Guardrails
Financial capacity / track record of recipient organizations
Finance expertise of recipient(s) / indirect recipient(s) and subgrantee(s)
* Treasury function expertise of applicant team
Federal Requirements
Consider whether permanent (vs. temporary) restriction of funds may promote recycling but negatively
impact ability for leverage, ability to make non-recycled but highly additional investments
Governance
Fiduciary expertise of board members
Reporting / Metrics
Financial sustainability metrics for applicant(s), direct recipient(s), indirect recipient(s) (e.g., net income,
self-sufficiency)
Take the long view - Consider how market-building activities that don't recycle funds may set the table for
greater business opportunities and hence longer-term operability of recipient(s)
Clawback/ Redistribution
Consider how intermediation structures may help to mitigate risk of funding riskier indirect recipient(s) /
subgrantee(s) by phasing investment overtime
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GHGRF Charge - Execution, Reporting, and Accountability
Thank You!
EFAB GHGRF Charge - Execution, Reporting, and Accountability Workgroup
Name
| Affiliation
| Location
| Sector
Ted Chapman (co-chair)
Investment Banking Analyst, Hilltop Securities, Inc.
Dallas, TX (EPA Region 6)
Business - Financial Services
MaryAnna Peavey (co-chair)
Grants and Loans Bureau Supervisor, Idaho Department of Environmental
Quality
Boise, ID (EPA Region 10)
State / Local Government
Ashley Allen Jones
Founder and Chief Executive Officer, i2 Capital
Washington, DC (EPA Region 3)
Business - Financial Services
Stacy Brown
President and Chief Executive Officer, Freberg Environmental, Inc.
Denver, CO (EPA Region 8)
Business - Financial Services
Jeff Diehl
Chief Executive Officer, Rhode Island Infrastructure Bank
Providence, Rl (EPA Region 1)
State / Local Government
Phyllis Garcia
Treasurer, San Antonio Water System
San Antonio, TX (EPA Region 6)
State / Local Government
Eric Hangen
Senior Research Fellow, Center for Impact Finance, Carsey School of Public
Policy, University of New Hampshire
Danby, VT (EPA Region 1)
Academic
George Kelly
Global Client Strategy Officer, Earth Recovery Partners
Denver, CO (EPA Region 8)
Business - Financial Services
Cynthia Koehler
Executive Director, WaterNow Alliance
San Francisco, CA (EPA Region 9)
Environmental /Non-
Governmental Organization
Dennis Randolph
City Traffic Engineer, City of Kalamazoo Public Services Department
Kalamazoo, Ml (EPA Region 5)
State / Local Government
Gwen Yamamoto Lau
Executive Director, Hawaii Green Infrastructure Authority
Honolulu, HI (EPA Region 9)
State / Local Government
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