The NCIF, which is frequently short-handed as a national green bank, aims to provide financing for tens of thousands of green energy and energy efficiency projects — with at least 40 percent of the benefits flowing to disadvantaged communities.

The CCIA is designed to build green lending muscle at the nonprofit institutions that already serve low- and moderate-income communities.

“EPA is trying to get money to the balance sheets of all these smaller community lenders across the country that then will be used to finance clean energy projects, whether it’s heat pumps, solar or renovating an affordable apartment building to make it really energy-efficient,” said Adam Kent, director of the green finance program at the Natural Resources Defense Council.

EPA interviewed top-ranking applicants for the two competitions in January, including five NCIF applicants. EPA also interviewed a highly rated subset of the roughly 30 nonprofits that applied for grants under the accelerator program.

Later this month, EPA will tap two or three “hub” nonprofits to distribute green bank funding to a network of lending institutions and green energy projects. At the same time, it is expected to award money to between two and seven grantees under the CCIA program.

EPA is also due to award funds under a $7 billion competitive grant program to help states and cities bring solar power to low-income communities. EPA told E&E News that it would announce those awards later in the spring.

The NCIF, or green bank, grew out of a decadelong legislative push by Democrats to create a lending facility to underwrite the U.S. transition away from fossil fuels and toward renewable energy and electrification.

The accelerator program, on the other hand, is an outgrowth of Biden’s effort to buttress communities that have suffered from decades of underinvestment. The program aims to help nonprofit lenders that already serve Black, brown and lower-income communities gain expertise in clean energy lending.

“This program is really EPA’s attempt to inject green capital into the capillaries of our financial system in terms of all these smaller community lenders all across the country,” Kent said.

There are more than 1,200 certified Community Development Financial Institutions, or CDFIs, in the United States — nonprofit, mission-driven lending institutions with deep roots in communities that for-profit banks historically avoided. They finance community projects, lend to small businesses and back most of the country’s affordable housing.

“But they’re not necessarily doing it thinking about how to maximize benefits from a climate and energy standpoint,” said Kirsten Stasio, CEO of Nevada Clean Energy Fund, the state’s nonprofit green bank. EPA’s aim with this program, she added, is to make those considerations “a core component of the traditional community lending in the U.S.”

The agency’s notice of funding opportunity last fall specified that selected “hub nonprofits” for the CCIA would be required to distribute 90 percent of their grant awards to community lenders like CDFIs and credit unions. Most of the money will go to capitalize projects in approved areas like solar or building efficiency, though both the hub nonprofits and the community lenders might use some for technical assistance.

Kent of NRDC said a hub nonprofit might elect to offer trainings to community lenders or help them meet reporting requirements. Community lenders themselves might use technical assistance dollars to hire loan officers with a particular expertise, like solar financing.

Typically, community lenders could receive up to $10 million in “capitalization funds” to support lending in approved areas. When combined with other Inflation Reduction Act incentives and potential funding from the green bank program, Stasio said that could be enough to capitalize a new local green bank.

Contenders for the NCIF green bank funding were mostly partnerships created for that funding opportunity, while CCIA applicants tended to be more established.

Among the CCIA finalists were Opportunity Finance Network (OFN), a decades-old CDFI trade association and financial intermediary with urban, rural and Native members; Native CDFI Network, which represents community lenders serving Indian country; and Appalachian Community Capital, which promotes economic diversification in communities where fossil fuels development has been a mainstay.

Harold Pettigrew, CEO of OFN, said his organization applied for nearly $3.3 billion in CCIA funds. He said EPA hadn’t contacted OFN on Thursday — which might indicate it will receive an award.

“The purpose of the CCIA is to build the capacity of the industry, so that there is long-term investment particularly focused on climate and sustainable finance,” said Pettigrew in an interview with E&E News.

He said OFN’s application proposed creating a lending “ecosystem” built around the needs of communities as much as addressing climate change.

EPA has said it will make successful applications public following its award announcements.