Infrastructure Deal Includes Grants for Nonprofits to Make Energy-Efficient Upgrades

President Biden signed the $1.2 trillion Infrastructure Investment and Jobs Act (the “Act”) into law on November 15, 2021. Included in the Act is a pilot program for making federal grants to tax exempt 501(c)(3) organizations to upgrade buildings owned and operated by such organizations in order to achieve more energy efficiency. The Act specifically contemplates the installation of materials on buildings that reduce the building’s use of fuel and other energy, such as upgrades to roofing material, lighting systems, windows, doors, and HVAC systems (including insulation, wiring, and plumbing improvements needed to service a more efficient HVAC system).

Individual grants are capped at $200,000 from a total pool of $50,000,000 authorized for appropriation over a five-year period starting in 2022. In determining whether to award a grant, the government will prioritize applicants based on the following four criteria:

  1. the energy savings achieved;
  2. the cost-effectiveness of the use of energy-efficient materials;
  3. an effective plan for evaluation, measurement, and verification of energy savings; and
  4. the financial need of the applicant.

The Act itself contains only a sketch of the pilot program’s details, but during 2022 expect to see additional details regarding the timing, form, and substance related to the submission of a grant application.

For those interested in reviewing the text of the Act establishing the pilot program, please take a look at Section 40542, “Energy Efficiency Materials Pilot Program,” here.

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