Prairie Rivers Network is committed to ensuring the opportunities and benefits of Illinois’ historic Climate and Equitable Jobs Act (CEJA) and federal climate legislation are fully realized by communities. As part of that effort, PRN’s Amanda Pankau and Randa Watts teamed up with University of Illinois Extension to discuss the new Illinois Climate Bank. Read on to learn more about one of the innovative efforts to bring funding opportunities to communities looking to transition to clean energy and navigate climate change.
What’s a Climate Bank?
Have you ever heard of a “Climate Bank”? Did you know Illinois has one? A Climate Bank, also known as a “green bank,” provides financing and initiatives to help communities transition to clean energy and respond to climate change.
The Climate and Equitable Jobs Act (CEJA) designated the Illinois Finance Authority as the Illinois Climate Bank. The law directed the new Climate Bank “to aid in all respects with providing financial assistance, programs, and products to finance and otherwise develop and implement equitable clean energy opportunities in the State to mitigate or adapt to the negative consequences of climate change in an equitable manner will further the clean energy policy of the State.”
Federal Funding is Flowing
At this time last year, the Illinois Finance Authority had no funds under management for climate and energy. Their focus up until that time had been on non-profit health and water infrastructure financing. As of May 2024, the Illinois Finance Authority had announced $340 million in expected awards for climate and energy grants and financing. Much of the funding secured by the Climate Bank comes from new federal programs created by the 2021 Bipartisan Infrastructure Law and the 2022 Inflation Reduction Act.
Opportunities with the Climate Bank can be leveraged alongside other state and federal incentives and funding for clean energy. For example, the state provides financial incentives for solar energy projects known as Renewable Energy Credits (RECs), covering 25-35% of project costs. Federal tax credits for clean energy are now available as Direct or Elective Pay. This means that tax-exempt entities, like nonprofits and municipalities, can now get 30-50% federal tax credits for clean energy projects. The state’s utilities, Ameren and ComEd, have programs for energy efficiency projects. Countless other state and federal grant programs are available to fund clean energy, electric vehicle infrastructure, and climate resiliency, particularly in disadvantaged and rural communities.
Let’s take a look at the funding and financing opportunities available and in the works with the Illinois Climate Bank.
Finance Opportunities
State Small Business Credit Initiative ($20M) – The State Small Business Credit Initiative (SSBCI) funds the Illinois Climate Bank’s Loan Participation Program, which works with banks and other financial institutions that are active in lending to small businesses. This opportunity provides small businesses access to capital. It focuses on projects that mitigate climate change, including hydroelectric, solar, and wind, as well as biomaterial production and the expansion of broadband in underserved communities. The Illinois Finance Authority contact for the SSBCI is Joanna Martinez-Avina, jmartinez-avina@il-fa.com
National Clean Investment Fund ($100+M) – In April, the USEPA announced grant awards from the Inflation Reduction Act’s Greenhouse Gas Reduction Fund. The Illinois Climate Bank was awarded funds through their successful application in partnership with and led by the Coalition for Green Capital (CGC).
The Climate Bank plans to utilize the money to further equitable energy and climate financing in Illinois. Funding is likely to be available in July 2024 for the following types of projects: Electric Vehicle Fleets & Associated Infrastructure, tax credit bridge loans to local governments and non profits, Carbon-Free Schools, and Building Electrification.
Revolving Loan Fund ($14M) – The Illinois Climate Bank plans to create a reliable source of low-interest loans to communities across the state, specifically for climate and energy projects. The program will be modeled after the State Revolving Fund, IEPA’s Drinking Water and Clean Water Programs.
Grant Opportunities
Grid Resilience Grants ($40M) – Under the Bipartisan Infrastructure Law, the U.S. Department of Energy is providing funds to States to create new grant programs focused on improving the resilience of their electric grids. The Climate Bank is responsible for distributing these grants in Illinois and will be receiving $8 million/year for the next five years to invest in projects. Funds can be used for a variety of investments, including for microgrids, weatherization, and automation. The Grid Resilience Grants Pre-Application is open now and will close on June 24th.
Solar for All ($156M) – In April, the Climate Bank was awarded a $156 M grant from the Inflation Reduction Act’s Greenhouse Gas Reduction Fund Solar for All program. Illinois has an existing state Solar for All programs administered by the Illinois Power Agency with funding from CEJA. The new federal award will be used to expand the existing program’s efforts to bring affordable solar to low-income communities, as well as expand community engagement, and clean energy workforce development.
Charging and Fueling Infrastructure ($15M) – In January, the state shared news that the Climate Bank had won $14.9M in federal funding from the US Department of Transportation’s Charging and Fueling Infrastructure (CFI) Program for electric vehicle charging infrastructure. The Climate Bank worked with over 40 partners, including park districts, counties, nonprofits, higher education entities, to identify 273 project sites that will receive electric vehicle charging stations ( 845 Level 2 EV Charging Stations and 36 DC Fast Charge stations).
Other Illinois Finance Authority Clean Energy Programs
C-PACE Program – The Commercial Property Assessed Clean Energy (“Commercial PACE” or “C-PACE”) is a financing structure for commercial properties that allows borrowed capital for clean energy projects to be repaid over time through a voluntary tax assessment. A C-PACE program with the IFA, is now available to all counties and municipalities in Illinois. Owners and developers of commercial properties can use c-PACE financing to finance or refinance eligible clean energy improvements (e.g. energy efficiency, renewable energy, electric vehicle charging stations). The Illinois Finance Authority contact for the C-PACE program is Brad Fletcher, bfletcher@il-fa.com.
We recently hosted a webinar with the Climate Bank. You can watch a recording here. You can also contact the Illinois Climate Bank directly to learn more about their programs.
