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1 [1] (May 21, 2024)

handle is hein.crs/govepnn0001 and id is 1 raw text is: Congressionol Research Service nforming the IegisI9tive debate since 1914 Updated May 21, 2024 EPA's Greenhouse Gas Reduction Fund (GGRF) On August 16, 2022, President Biden signed H.R. 5376 (P.L. 117-169), a budget reconciliation measure commonly referred to as the Inflation Reduction Act of 2022 (IRA). IRA contains eight titles, each with some provisions that directly or indirectly address issues related to climate change, including the reduction of U.S. greenhouse gas (GHG) emissions and the promotion of adaptation and resilience to climate change impacts. RA Section 60103: reenhouse as Reduction Fund Section 60103 of IRA (codified at 42 U.S.C. §7434) amends the Clean Air Act to provide for a Greenhouse Gas Reduction Fund (GGRF) to be administered by the U.S. Environmental Protection Agency (EPA). The provision appropriated $27 billion to EPA for FY2022, out of money in the Treasury not otherwise appropriated, to remain available until September 30, 2024, to make grants, on a competitive basis, as follows: * $7.0 billion to states, municipalities, tribal governments, and eligible recipients for the purposes of providing grants, loans, or other forms of financial assistance, as well as technical assistance, to enable low-income and disadvantaged communities to deploy or benefit from zero-emission technologies; * $11.97 billion to eligible recipients for financial and technical assistance for qualified projects; * $8.0 billion to eligible recipients for financial and technical assistance for qualified projects in low-income and disadvantaged communities; and * $30.0 million for agency administrative costs. IRA defines eligible recipient as a nonprofit organization that * is designed to provide capital, leverage private capital, and provide other forms of financial assistance for the rapid deployment of low- and zero-emission products, technologies, and services; * does not take deposits other than deposits from repayments and other revenue received from financial assistance provided using grant funds under IRA; * is funded by public or charitable contributions; and * invests in or finances projects alone or in conjunction with other investors. IRA defines qualified projects to include any project, activity, or technology that reduces or avoids GHG emissions and other forms of air pollution in partnership with, and by leveraging investment from, the private sector. Eligible recipients that meet the above definition may use the grant funding for * direct investments in the form of financial assistance for a qualified project or * indirect investments in the form of funding and technical assistance to support new or existing public, quasi-public, or nonprofit entities that in turn provide financial assistance to qualified projects at the state, local, territorial, or tribal level, including community- and low-income-focused lenders and capital providers. IRA directs EPA to begin this process not later than 180 calendar days after the date of enactment (i.e., not later than February 12, 2023). Section 60103 does not explicitly state additional requirements that would apply to EPA or its grant recipients, such as general federal requirements for grants and agreements. EPA impl ementation Upon enactment of IRA, EPA launched a stakeholder engagement strategy to help shape implementation of the GGRF. EPA conducted listening sessions for members of the public and stakeholder groups on November 1 and November 9, 2022. EPA published a Request for Information seeking public comment on core design aspects of the GGRF. Further, EPA delivered a set of formal charge questions for expert review and comment at the October 18- 19, 2022, meeting of the agency's Environmental Financial Advisory Board (EFAB). On January 26, 2023, EFAB submitted guidance and considerations to EPA regarding the GGRF's potential objectives, program structure, execution, reporting, and accountability. In its review, EFAB assessed the strengths and weaknesses of various design elements of the fund including financial leverage, additionality (i.e., whether project proposals would proceed in the absence of the GGRF), capital recycling, capacity building, and long-term operability across various recipient types including states, municipalities, tribes, regional collectives, sectoral collectives, lender intermediaries, and a national entity. On February 14, 2023, EPA reported initial guidance on the design of the GGRF program. At the time, EPA announced plans to hold two competitions to distribute the grant funding: a $20 billion General and Low-Income Assistance Competition and a $7 billion Zero-Emissions Technology Fund Competition.

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