New partnership aims to help green banks capitalize on federal funding

Last month, the Biden administration allocated $20 billion to a national clean financing program. For the communities that the program aims to serve, though, now comes the tricky part: actually securing their portion of the funding, aimed at financing much-needed infrastructure projects. 

• The top line: Banyan Infrastructure, Elemental Excelerator, and the Milken Institute today announced a partnership to provide green banks and community leaders with the resources to take maximum advantage of the new Greenhouse Gas Reduction Fund. Their focus will be on helping local financiers to get clean energy, transportation, and housing projects funded.
• The nuts and bolts: The partnership will provide community lenders with access to Banyan’s project finance software; training and resources for lending best practices provided by the Milken institute; and community engagement strategies via a project financing and transaction platform funded by Elemental Excelerator. 
• The market grounding: The Biden administration rolled out the GGRF as part of the Inflation Reduction Act. The program, which earmarked $20 billion for green banking and poured another $7 billion into expanding community solar nationwide, helps de-risk cleantech investment for projects that might seem too uncertain to draw large amounts of private capital. Essentially, GGRF helps traditionally underserved communities build out green infrastructure via low-cost financing. 

Banyan, Elemental, and the Milken Institute plan to educate community lenders on project finance best practices so they can make the most of the federal funding flow. Community lenders in California, Texas, and Nevada are already lined up to be the first beneficiaries.  

Banyan’s online platform includes a digital suite of software solutions including impact tracking, deal monitoring, and reporting. And best practice scorecards and underwriting checklists are designed to ease the process of securing funding for veteran and new green banks alike.

Elemental’s funding will help expand Banyan’s community engagement efforts; the Fresno, California-based community development bank Access Plus Capital will be the program’s inaugural partner. 

“Project financiers desperately need a collaborative ecosystem for accelerating both the deployment and recycling of capital,” Banyan CEO Will Greene said in a statement. 

He added that the current ecosystem lacks “connective tissue” between capital allocation and deployment, tissue that the partnership aims to build and maintain — even after the GGRF’s initial funding is invested.