US EPA's $7B Solar for All program expected to drive 4 GW in capacity additions

The Biden administration on April 22 announced $7 billion in solar grant awards for low-income and disadvantaged communities through the US Environmental Protection Agency's Greenhouse Gas Reduction Fund.

The EPA estimated that its Solar for All program, enacted under the 2022 Inflation Reduction Act, will drive more than 4 GW of solar capacity additions over five years and reduce cumulative greenhouse gas emissions by about 30 million metric tons.

Sixty awardees were selected through the EPA's competitive grant process — 49 state-level agencies, six Native American tribes or tribal consortiums and five multistate applicants — according to a list provided by the EPA.

All the awardees have committed to delivering at least 20% savings on customer utility bills. Around 900,000 households will benefit from the Solar for All program, which is expected to generate over $350 million in annual savings, the EPA said in a press release.

The grants will result in new residential solar programs in at least 25 states that previously lacked "substantial low-income solar programs," the EPA said.

Solar for All also allows qualifying projects to include energy storage. More than a dozen states, as well as Washington, DC; Puerto Rico; and the US Virgin Islands, intend to accelerate residential storage deployment as part of their implementation plans.

Maximizing the Inflation Reduction Act's complementary programs will be crucial during implementation, Adam Kent, director of blended and inclusive finance for the National Resource Defense Council, said in an April 22 blog post. Those include elective direct pay options for tax-exempt and governmental entities, which allow entities to receive the full value of the law's clean energy tax credits. The law also lets entities transfer all or a portion of clean energy tax credits to third-party buyers in exchange for cash.

The EPA said it expects to finalize the awards this summer. New programs are expected to launch in the fall and winter of 2024.