For years, many states, cities, and Tribal nations have been leaders in advancing climate action in the U.S. States, especially, have laid a roadmap for climate action. In the 1980s and 90s, states began passing the first U.S. laws to require more renewable energy on the electricity grid. In the early 2000s, some states enacted the first measures requiring reductions in climate pollution—and many successfully sued the federal government for failing to do the same. Since 2015, 15 states have enacted requirements that their electric utilities reach 100 percent clean electricity, while several have enacted requirements for 100 percent zero-emission technology in new vehicle and appliance sales, or new building construction. In 2017, when former President Trump announced his intention to pull the U.S. out of the Paris Climate Agreement, many states, cities, and Tribal leaders—Democrats and Republicans alike—announced that their jurisdictions would remain committed to that accord, and they partnered together to advance that goal through groups like the U.S. Climate Alliance and America is All In. 

In fact, many of the new investments and policies enacted by the federal government in the IRA are directly inspired by similar policies first advanced by these “subnational” governments.

However, much more U.S. subnational climate action is needed—from more states, in particular—if we are going to reach our climate goals of a 50-52 percent reduction in greenhouse gas pollution by 2030, and net-zero climate pollution by mid-century. New investments in the IRA, and others in the Bipartisan Infrastructure Law (BIL) and CHIPS and Science Act, can make it easier for states, local governments, and Tribes to go further on climate. And the CPRG program is an important “force multiplier”—designed to empower subnational governments with more capacity and incentive to seize these opportunities and leverage greater public and private sector investments in climate solutions. In short, the CPRG program can inspire the next generation of state and local climate leadership.

So, what are Climate Pollution Reduction Grants? 

The CPRG program is a $5 billion program created in the IRA and run by the Environmental Protection Agency (EPA). It’s intended to support states, municipal governments, air pollution control agencies, and Tribal nations in the development and implementation of plans and “programs, policies, measures, and projects that will achieve or facilitate the reduction” of greenhouse gas pollution. It is largely based on the State Clean Energy Challenge Grants program proposed by President Biden in his American Jobs Plan, in March 2021. (Biden’s proposal was inspired in part by a similar past federal challenge grant program supporting state leadership on innovative education policies.) 

The CPRG program consists of three elements: 

• Planning Grants: $250 million available to all states and territories, and many municipal governments and Tribal nations, to develop plans to reduce climate pollution
• Implementation Grants: $4.607 billion to support the implementation of (some) of those plans
• Administrative Funding: Up to $142 million for the federal government to administer the program and assist state, local and Tribal governments in their climate efforts

Three reasons the CPRG program is a big deal for states, local governments, and Tribes 

1. It provides flexibility for subnational leadership to address their own unique challenges and opportunities. 

One of the most exciting things about the CPRG program is the flexibility that it provides to states, local governments, and Tribes to design the economic and industrial strategies that achieve emissions reductions and best suit their unique needs. It meets states where they are; while some have been leaders with sectoral or economy-wide programs designed to reduce climate pollution, others have not yet been able to make the kind of progress that we need to see in every jurisdiction, and for every community, throughout the country. That means the CPRG program could be particularly valuable in how it supports new clean energy breakthroughs in new states. 

2. It will support critical government capacity to build our new energy economy. 

Throughout the country, state, local and Tribal governments need additional capacity in order to supercharge their clean energy progress. This has been particularly evident as subnational government agencies try to seize on the massive new federal funding opportunities available to them and their companies, communities, and consumers. The CPRG program provides funding that state (and city, county, and Tribal) agencies can use to hire staff and consultants, bolster administrative capacity, and build the necessary tools—like high-quality greenhouse gas inventories—to advance climate action. Already, EPA has worked to address this challenge by quickly offering capacity-building planning grants to every state and territorial government, many Tribal nations, and dozens of the largest metropolitan statistical areas.

3. It provides an opportunity to invest in more equitable environmental and economic outcomes. 

Congress wrote the CPRG program to require all applicants to demonstrate how their plans will reduce climate pollution, in total, and in disadvantaged communities, in particular. The program also falls under President Biden’s Justice40 Initiative, meaning the EPA must ensure not less than 40 percent of the benefits of the program are delivered to disadvantaged communities. And, already in early program guidance, EPA has told state and local governments they must conduct meaningful engagement with these communities in building their climate plans. EPA’s initial CPRG guidance also encourages eligible entities to develop plans that “reduce climate pollution while building the clean energy economy in a way that benefits all Americans, provides new workforce training opportunities, and effectively addresses environmental injustices in disadvantaged communities.”

What comes next for the CPRG program?

The investments that the CPRG program will make in state, local, and Tribal governments are critically important for their own sake and for the “force-multiplying” effects they will have for subnational governments to take advantage of the full suite—hundreds of billions of dollars—of climate investments available through the IRA, BIL, and CHIPS & Science Act. 

These are some upcoming opportunities within the three main buckets of the CPRG program and what must come next to propel further progress on equitable decarbonization across the U.S.:

Planning Grants

Fortunately, EPA and the Biden Administration recognize the urgency and importance of these investments and are moving to rapidly deploy the program’s $250 million in initial planning grants. Also encouragingly, states, local governments, and Tribes are eager to put them to use; 46 out of 50 states submitted notices of intent to apply for planning grants. (Even those four states who declined funding will now see those dollars flow to their largest urban areas.) 

But EPA still must get these planning grant funds out the door quickly, especially as states await other federal funding that state agencies rely upon. Planning grant applicants are tasked with creating a priority climate action plan, due in early 2024. Then applicants must submit a comprehensive climate action plan in two years.

Implementation Grants

Next, EPA will launch its implementation grant funding competition, worth a much larger $4.607 billion, later this year. EPA has the opportunity to use CPRG implementation grants to support both: 

• Transformational state clean energy action plans that will reduce climate pollution—especially in new places; and 
• Widespread subnational government capacity for sustained clean energy leadership.

As it designs this competition, EPA should heed the recommendations provided to it by 40 organizations, including Evergreen, in December 2022. These groups urged EPA to utilize two “tiers” of implementation grant awards. The first tier would award the majority of implementation grant funding (Evergreen recommends around $4.1 billion) for a select number of grant awards that demonstrate the largest additional, verifiable, and permanent climate pollution reductions—beyond that which might be otherwise achievable in the state's current policy environment. The second tier would consist of the remainder—a smaller portion—of implementation grant funding. This would be divided up into smaller grants to all states, local, and Tribal governments, who were previous planning grant recipients and who show how they’ll use the dollars—on top of their initial grant—for government capacity to further their efforts.

EPA should also encourage states to work together and require them to work with their local and Tribal governments in their grant applications. Applicants should be tasked with showing how they’d use funds to meaningfully engage with and advance pollution reductions and economic benefits in disadvantaged communities, and support high-quality, good-paying jobs. Finally, we urge EPA to move quickly, in order to be able to award implementation grant funding as early as possible in 2024.

Administrative Funding

EPA has also reserved the $142 million that is available in the CPRG program for administrative costs. With these funds, the federal government can improve how it coordinates with and provides technical assistance to support state, local, and Tribal governments. 

However, it’s now incumbent on EPA to show how these dollars will be spent. For example, in expanding staff capacity in EPA regional offices to assist states on their climate plans, partnering with other federal agencies (such as the Departments of Energy, Agriculture, and Commerce, and the National Labs) at the regional level to provide more flexible and tailored technical assistance, and supporting state and local air pollution enforcement, especially in disadvantaged communities.

State, Local, and Tribal Grant Applicants

Meanwhile, states, local governments, and Tribes should be simultaneously preparing to take full advantage of the CPRG program. 

Momentum for climate action is growing in many subnational jurisdictions—and in many new states, in particular. Over 20 states are now committed to achieving 100% clean energy. Now, thanks to the influx of federal resources, momentum is building for new and accelerated clean electricity standards, adoption of California’s landmark clean cars and trucks rules, as well as upgrading building codes and setting zero-emission appliance standards, and investments in clean and competitive American industries and climate-smart agriculture. And again, beyond this, 46 of 50 states have already raised their hands in applying for CPRG planning grants.

But much more work needs to be done to turn state commitments into concrete policy outcomes that reduce emissions and that build a just, thriving, and inclusive clean energy economy. 

CPRG planning grants can support progress in all 46 states that have applied for them, almost immediately, with more capacity-building investments to come. And then, the opportunity to compete for a larger implementation grant can provide states’ governors’ offices, key agencies, legislatures, and advocacy communities with a locus of organization and momentum to ensure more states pursue ambitious policies and realize major clean energy breakthroughs.