MEEA Policy Insider - July 2024

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The MEEA Policy Insider summarizes the latest state and federal policy activity and provides new resources to aid members in their outreach, education and advocacy initiatives.

 In this issue: 

 

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Illinois banner

Executive

On June 7, the Illinois Stretch Energy Code proposed rules were published in the Illinois Register. The proposed rules can be found here. The proposed stretch code includes provisions related to heat pumps, demand response, electrical energy storage system readiness, solar-readiness and electric-readiness. MEEA submitted comments during the initial 45-day comment period on the proposed rules, which closed on July 22. The code now moves to the Joint Committee on Administrative Rules (JCAR) for a final round of public comment and voting to officially adopt the codes. The process is now expected to be completed by October 2024. If adopted by JCAR, the state stretch energy code will be available for municipal adoption.

On July 22, the Illinois Environmental Protection Agency (IEPA) was awarded a $430 million Climate Pollution Reduction Grant Implementation Grant (CPRG). The statewide Illinois Priority Climate Action Plan (PCAP) highlighted energy efficiency in multiple priority measures, including:

  • Improving building efficiency, reaching a 33% reduction in energy use in buildings by 2050.
  • Accelerating the use of efficient, all-electric heating appliances in buildings, significantly increasing their share of new sales to between 50% and 90% by 2050.
  • Establishing a clean building gap closing and incentive stacking catalyst fund, to braid together available incentives to achieve full decarbonization of residential buildings for low-income and moderate-income households and households in disadvantaged communities.
  • Improve industrial efficiency 5% by 2030 and 25% by 2050, and support implementation of process improvements.

The Chicago, Naperville and Elgin Metropolitan Statistical Area (MSA) also submitted a PCAP to the EPA, but they were not awarded an implementation grant. Both the Illinois EPA and the Chicago, Naperville and Elgin MSA will submit Comprehensive Climate Action Plans in August 2025, as an extension of CPRG planning grants awarded in 2023.

Municipal

On January 24, Mayor Johnson of Chicago introduced the Clean and Affordable Buildings Ordinance (CABO). The ordinance would greatly restrict natural gas usage in all newly constructed buildings by banning the combustion of fuels that emit more than 25 kilograms of carbon dioxide per million Btu of energy inside a structure. After an initial hearing on April 3, a majority of Chicago City Council members have come out against CABO. The Ordinance remains with the Rules Committee and is unlikely to move forward in the near future.

Legislative

With the Illinois spring legislative session now over, the fall veto session has been scheduled to begin November 12. 

Regulatory

The Illinois Commerce Commission released a draft Report on Phase 1 of its Future of Gas proceedings. MEEA submitted comments on the draft Report on July 12. The ICC and the facilitation team will review comments and release their final report on the first phase of the proceedings on August 1. The first workshop of the second phase of the Future of Gas proceedings has been scheduled for August 28.

On May 30, the ICC adopted a new Renewable Energy Access Plan (REAP) that urges utilities and transmission providers to consider grid-enhancing technologies, which improve efficiency of the grid.

In July, the Illinois Energy Efficiency Stakeholder Advisory Group (SAG) discussed changes to the Total Resource Cost Test non-measure level inputs for the 2026-2029 EE Plans. Ameren Illinois presented their Market Effects Evaluation approach. Guidehouse and Opinion Dynamics presented tracking for Net-to-Gross (NTG) for disadvantaged areas for all Illinois utility EE programs.

How to Get Involved

For more information about Illinois or to get more involved, contact Kit White

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Regulatory

The Indiana Utility Regulatory Commission (IURC) has opened an investigation in Cause Number 46043 into whether a Distributed Energy Resource Aggregator (DERA) is a public utility. Some pre-filed testimony has been added to the docket recently.

2024 Integrated Resource Plans (IRPs) are expected from:

  • Publicly-owned utilities
    • Indiana-Michigan Power (AEP) – Indiana-Michigan Power has begun its IRP process in Indiana, with its first virtual workshop for Indiana on June 27. The IRP due date has been extended by the IURC to March 3, 2025.
    • Wabash Valley – Comments on the Wabash Valley Power Association’s 2023 IRP are due by August 12 and can be sent by email to Dr. Bradley Borum.

Updates from the Commission on IRPs in Indiana will be posted to the IURC’s IRP page.

How to Get Involved

For more information about Indiana or to get more involved, contact Greg Ehrendreich

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Municipal

In the spring, the Cedar Rapids Metro Area, Iowa City Metro Area and Des Moines / West Des Moines Metro Area all submitted Priority Climate Action Plans (PCAPs) to the EPA through the Climate Pollution Reduction Grant program. No Iowa Metropolitan Statistical Area (MSA) was awarded an implementation grant – but each group will still complete a Comprehensive Climate Action Plan by August 2025 to guide future local climate action.

How to Get Involved

For more information about Iowa or to get more involved, contact Clara Stein.

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Regulatory

On July 15, Kansas Evergy filed an application for approval of its 2024 Energy Efficiency Rider for Program Costs with the Kansas Corporation Commission. This process is a continuation of Kansas Evergy’s KEEIA 2024-2028 DSM Portfolio – which became effective following Commission order and approval under Docket No. 22-EKME-254-TAR. Kansas Evergy seeks to apply the 2024 Energy Efficiency rider to ratepayers beginning on November 1, 2024, Additional developments can be seen in Docket #25-EKCE-080-TAR.

How to Get Involved

For more information about Kansas or to get more involved, contact Clara Stein

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Michigan banner

Executive

On July 22, Michigan was awarded a $129 million Climate Pollution Reduction Grant Implementation Grant by the EPA. The state of Michigan’s Priority Climate Action Plan included multiple energy efficiency focused priority measures, including:

  • To reduce household fossil energy use through home repairs, electrical upgrades for electric-readiness, weatherization and other energy waste reduction investments with an emphasis on ensuring equitable access. 
  • To decarbonize government and nonprofit facilities and infrastructure, with a focus on LIDAC areas, by reducing energy waste and investing in decarbonization solutions.
  • To encourage industrial innovation to advance energy efficiency.

The Grand Rapids Metropolitan Service Area (MSA) and Detroit-Warren-Dearborn MSA also submitted PCAPs to the EPA, but they were not awarded implementation grants. MI EGLE, Grand Rapids MSA and Detroit-Warren-Dearborn MSA will all submit Comprehensive Climate Action Plans in August 2025, as an extension of CPRG planning grants awarded in 2023.  

Legislative

Michigan legislators finalized the state budget, which the Governor signed on July 24. The budget includes several line items for key energy priorities:

  • The Michigan Public Service Commission received a substantial funding increase to hire additional staff to implement the 2023 legislation. The Commission also received $1 million to conduct an energy efficiency and demand response potential study.
  • Legislators also allocated funding for a housing affordability program, which will include funding for deep energy efficiency retrofits in the existing housing stock.
  • Michigan Saves received $5 million to help leverage funding for clean energy projects.

Legislators are now on summer break; it is expected that the legislature will reconvene for session days later in the year and could take up some of the bills below.

  • SB 237, which would extend tax credits to data centers to encourage companies to site them in Michigan, passed out of the Senate on May 9.
    • HF 4906, which is virtually identical but focuses on the sales tax portion as opposed to the use tax portion, passed the Senate as amended on May 16. Both go to the House now to be concurred.
    • The bills have gathered opposition from energy and environmental advocates who are concerned that an influx of data centers could jeopardize the state’s target of carbon-free electricity generation by 2040, which was enacted into law last year by the legislature. In order to qualify for the credits, a data center facility must attain one or more green building standards, such as BREEAM®, ENERGY STAR®, ISO 50001, LEED®, Green Globes® or UL 3223. The bill additionally states that data centers are encouraged (but not mandated) to take positive steps to mitigating environmental impacts, including adoption of energy efficiency measures.
  • Sen. Singh and Sen. Outman have introduced a package of bills – SB 879, SB 880 and SB 881 – that would collectively amend the state’s processes around the state’s Low-Income Energy Assistance Fund. Among other changes, the legislation would allow the Commission to increase the funding factor for the assistance from $1 per ratepayer to $2, remove the $50 million cap, remove the provision that utilities could opt-out of collecting the funding factor and institute a requirement that the Department of Health and Human Services submit an annual report on the disbursement of funds. SB 880 and 881 passed the Senate on June 26 and now head to the House.
  • Lastly, Governor Whitmer signed HB 5028 into law. The bill prohibits homeowners’ associations from preventing Michigan homeowners from installing, replacing or maintaining energy-saving improvements, like heat pumps, insulation, energy efficient appliances and more. 

Regulatory

The Michigan Public Service Commission (MPSC) has several open dockets to implement the 2023 energy legislation.

  • Case U-21638 addresses public engagement processes at the MPSC.
    • The Commission is asking for comments on five questions on how the MPSC can improve its processes to foster more effective community participation. Comments are due to the Commission by September 27, with reply comments due October 24. 
  • Case U-21567 will address the energy waste reduction 
    (EWR) legislation. The MPSC ordered Commission Staff to work with utilities, state government, low-income advocacy organizations and others to develop strategies around income verification and program coordination to minimize barriers to participation in low-income EWR programs.
    • Parties filed comments by July 17 with reply comments due by August 9.
  • Case U-21570 will address the legislative changes to the MPSC.
    • The MPSC has ordered Commission Staff to study the potential for EWR, demand response and electrification of transportation, buildings and industry by September 30, with final potential studies completed by July 31, 2025.
    • The Commission directed Staff to file a redline version of the Michigan Integrated Resource Planning Parameters and Filing Requirements by September 30, along with a straw proposal for municipal and cooperative electric utilities and alternative electric suppliers to submit a clean energy plan.
    • Nothing has been filed in the docket yet. 
  • Case U-21572 addresses the requirement that the MPSC study and report on electric issues unique to the Upper Peninsula (UP).
    • The MPSC is hosting a meeting in the UP on July 30 to present on its ongoing UP energy study. The MPSC will take public input on its plan through August 9. 
    • MPSC Staff must file the final study by November 22.

How to Get Involved

For more information about Michigan or to get more involved, contact Maddie Wazowicz

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Executive

On July 22the Minnesota Pollution Control Agency was awarded a $200 million Climate Pollution Reduction Grant Implementation Grant by the EPA. The statewide Priority Climate Action Plan highlighted energy efficiency measures such as:

  • Reducing greenhouse gas emissions from residential buildings by promoting energy efficiency, electrification, and lower carbon design, materials and fuels. 
  • Reducing greenhouse gas emissions from commercial and public buildings by promoting energy efficiency, electrification and lower carbon design, materials and fuels.
  • Increasing industrial efficiency. 

Each priority measure is accompanied by many program design avenues highlighting greenhouse gas emissions reductions and equitable implementation. The Minnesota Pollution Control Agency will submit a Comprehensive Climate Action in August 2025 – integrating implementation components made possible by new EPA funding.

Regulatory 

The Minnesota Public Utilities Commission (PUC) approved CenterPoint’s Natural Gas Innovation plan on July 25 in docket 23-215. The plan outlines $106 million in spending on various pilot projects to help CenterPoint decarbonize. Amongst the pilots are programs to incentivize industrial electrification of low-to-medium heat processes, hybrid systems with gas backup for small-to-medium commercial buildings, deep energy retrofits and electric air source heat pumps for residential customers, audits to expand energy efficiency offerings outside of the CIP framework and gas heat pumps.

The PUC continues to work on its natural gas integrated resource plan process in docket 23-117. Utilities submitted their straw proposals on May 31. Plan links can be found here:  

Comments were due on these proposals by June 28, with reply comments due July 19. It is anticipated that the PUC will meet on September 12 to make further decisions on these plans and the IRP process.

Xcel released its 2024-2040 Upper Midwest integrated resource plan in docket 24-67. The plan outlines how Xcel will meet increased demand while also complying with the state’s new carbon-free standard and includes substantial energy efficiency and demand response. Xcel has also proposed time-of-use rates as the default rate structure for its customers. Commissioners will hear the IRP by February 2025. 

How to Get Involved

For more information about Minnesota or to get more involved, contact Maddie Wazowicz.

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Legislative

The Missouri Legislature concluded its session on May 17 as scheduled, ending with no major changes to energy efficiency in the state. Veto session will commence on September 11 to respond to veto action taken by the Governor, which was due by July 14. 

Regulatory

Proceedings are nearing their end of schedule for Ameren Missouri’s MEEIA Cycle 4 plan, which can be followed in docket EO-2023-0136. Ameren filed its amended application on January 25 outlining their proposed programs - a robust plan of 25 programs, including $70 million for income-eligible programs, a residential efficient products program and a Pay As You Save® program. As previously ordered, evidentiary hearings have been proceeding in July, with parties making their final position statements. Key parties, including Commission Staff and the Office of Public Counsel, weighed in on the proposal, indicating they do not support an extension of MEEIA programs. MEEA will continue to track the outcome of this docket, as results are expected to affect the other investor-owned Utility MEEIA filings which are forthcoming.

The proceedings for Missouri’s MEEIA Cycle 4 plan are also underway in docket EO-2023-0369. Intervenors initial testimony was filed in May and rebuttal testimony has been filed in July. 

Missouri’s triennial Integrated Resource Planning (IRP) process is still underway. You can read Ameren’s 20-year IRP here and follow docket EO-2024-0020. You can read Every Missouri’s plan here and follow docket EO-2024-0154

How to Get Involved

For more information about Missouri or to get more involved, contact Natalie Newman

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nebraska banner

Legislative

Nebraska’s 2024 legislative session adjourned sine die on April 19. The unicameral reconvened on July 25 for a special session on Governor Pillen’s proposed property tax plan, though it’s possible additional issues will be raised. The session is expected to last through mid-August. 

Executive

On July 22, The Nebraska Department of Energy and Environment (NDEE) was awarded a $307 million Climate Pollution Reduction Grant program Implementation Grant. The statewide Priority Climate Action Plan included multiple energy efficiency focused priority measures, including:

  • Expanding NE’s public utilities incentive programs for energy efficiency, electrification and weatherization upgrades for nonresidential buildings and facilities.  
  • Delivering financial assistance to low-income Nebraskans for critical home repairs that will lead to eligibility for energy-efficiency upgrades through the Weatherization Assistance Program.
  • Funding incentives for home energy efficiency upgrades for low- and middle-income homeowners – providing rebates for purchase and installation of whole-home air-source heat pumps and heat pump water heaters.

The NDEE will submit a Comprehensive Climate Action plan in August 2025 and utilize this historic level of funding to advance clean energy solutions and greenhouse gas reduction across the state. 

In June, the City of Omaha published the Omaha Climate Action and Resiliency Plan (draft plan). The plan sets multiple priority actions for energy efficiency and energy code advancement, driven by an overarching goal to improve total citywide building energy efficiency (all sectors) 10% for electricity and natural gas by 2035. The Omaha Climate Action Plan is open for public comment through August 30. Access public comment portals within each corresponding section of the Omaha Climate Action and Resiliency Plan here.

Regulatory

Omaha Public Power District (OPPD), the public power district serving Omaha and the wider 13 county region, is completing an annual review of their Strategic Directive 7, which guides OPPD’s sustainability initiatives. Within the scope of sustainability, OPPD allots funding for energy efficiency and demand response. On June 18, the Systems Committee presented draft recommendations for SD-7 to the OPPD Board. The draft language was returned to the Systems Committee for further development and will likely be presented during OPPD’s August Board meeting. There will be a 30-day public comment period for stakeholder input after a formal board presentation. On May 31, MEEA submitted comments highlighting the critical nature of energy efficiency investments to meet Net Zero Emission goals by 2050. MEEA will continue to monitor and participate in this public process. 

How to Get Involved

For more information about Nebraska or to get more involved, contact Clara Stein

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north dakota banner

Executive

In the spring, the North Dakota Department of Environmental Quality submitted a statewide Priority Climate Action Plan (PCAP) to the EPA through the Climate Pollution Reduction Grant Program. This is the State of North Dakota’s first Climate Action Plan and includes a comprehensive greenhouse gas inventory. The PCAP includes goals to expand the existing energy conservation grant programs to update public buildings. Although North Dakota did not receive an implementation grant from the EPA, the state will utilize formula planning award funds to produce a Comprehensive Climate Action Plan by August 2025.

How to Get Involved

For more information about North Dakota or to get more involved, contact Clara Stein

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Ohio banner

Legislative

The 2024 session convened on January 2 as a carryover session. See the calendar here. Session runs the full calendar year and is currently scheduled through June. 

The most notable energy-related bill this session, HB79, passed the House by a vote of 50-46 on June 26 and will go to the Senate during lame duck later this fall. The bill would allow utilities to establish limited voluntary energy efficiency programs. The bill does not create mandatory energy efficiency in Ohio but does allow for utility-run residential and small commercial energy efficiency programs. Notably, the legislation would allow customers to opt out of efficiency programs and provides that utilities must notify customers how to opt out. The Public Utilities Commission of Ohio will have oversight approval of the cost effectiveness of any EE programs.

Regulatory

First Energy applied for a $72.1 million / 4-year energy efficiency and demand response program as part of its Standard Service Offer (SSO) case in docket 23-0301-EL-SSO. In the Opinion and Order on May 15, the Commission followed Staff recommendations and eliminated everything except for Low-Income and Energy Education programs and directed the development of a smart thermostat demand response program. In response to petition of five separate parties, including the utility, the PUCO granted an order for rehearing on specific matters.

Duke Energy Ohio has applied for a $28 million annual voluntary energy efficiency program for 2024-2026 in docket 24-0045-EL-POR. The case is ongoing.

Municipal 

On July 22, the EPA awarded the Cleveland-Elyria, OH Metropolitan Service Area (MSA) -- Cuyahoga County -- a $129 million Climate Pollution Reduction Grant program Implementation Grant. The Cleveland-Elyria MSA Priority Climate Action Plan included multiple priority measures related to energy efficiency and energy code advancement, including:

  • Increasing the home weatherization program.
  • Installing building envelope and electrification for low- and moderate-income residents – stacking incentives to create low and no cost options.
  • Advocating for the state to update building codes and developing a benchmarking policy that requires larger buildings to report energy use.

The Cleveland-Elyria MSA will strategize to distribute funding and implement new programs while developing a Comprehensive Climate Action Plan, due August 2025. Although the statewide Ohio, Columbus MSA, Dayton-Kettering MSA and Cincinnati MSA PCAPs did not receive implementation grant awards, they will continue development of Comprehensive Climate Action Plans utilizing initial CPRG planning grant funding.

How to Get Involved 

For more information about Ohio or to get more involved, contact Greg Ehrendreich

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Municipal

In the spring, Rapid City, SD submitted a Climate Pollution Reduction Grant (CPRG) Priority Climate Action Plan for the Rapid City Metro Area. Although the State of South Dakota denied formula funding awards to craft a state climate action plan, Rapid City will continue with the EPA process, submitting a Comprehensive Climate Action Plan in August 2025 despite not receiving an EPA implementation award.

In early July, Rapid City was awarded a $136,000 Energy Efficiency Conservation Block Grant from the DOE to implement energy efficiency upgrades to an aging maintenance facility. 

How to Get Involved

For more information about South Dakota or to get more involved, contact Clara Stein

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Legislative

The Wisconsin Senate met on May 14 for a veto session, but the session abruptly ended after lawmaker disagreements. The Senate did not successfully override the Governor’s vetoes on any energy-related bills, like those related to restricting fuel-switching bans. Some committees have continued to meet in the summer; the Senate Committee on Natural Resources and Energy most recently met on July 9.

  • AJR 6/SJR 5 passed the legislature. The Joint Resolution proposes a constitutional amendment that would move the authority to accept and allocate federal funding from the governor to the legislature. The amendment will now be on the ballot as Question One at the August 13 primary. If the amendment passes, this will likely result in the state accepting significantly less federal funding, including funding that addresses energy projects from the Bipartisan Infrastructure Law and the Inflation Reduction Act.

Regulatory

Focus on Energy staff released a memo detailing research APTIM and VEIC conducted to help program administrators target and reach underserved customers. Staff wanted feedback on the metrics identified by the consulting team. MEEA submitted comments on July 8 which can be found here.

How to Get Involved

For more information about Wisconsin or to get more involved, contact Maddie Wazowicz

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Federal updates

Legislative

A legislative package, aimed at dismantling home appliance efficiency standards, is moving through the House. The package includes:

  • HR 6192, the Hands Off Our Home Appliances Act
  • HR 7673, the Liberty in Laundry Act
  • HR 7645, the Clothes Dryers Reliability Act
  • HR 7637, the Refrigerator Freedom Act
  • HR 7626, the Affordable Air Conditioning Act
  • HR 7700, the Stop Unaffordable Dishwasher Standards Act

The Hands Off Our Home Appliances Act would empower a future DOE to revoke existing efficiency standards for home appliances and prohibit standards that increase the upfront cost of an appliance regardless of utility bill cost savings. The other five bills under consideration target recently completed and pending energy efficiency standards for washers, dryers, refrigerators, air conditioners and dishwashers, while making future efficiency standard improvements far more difficult to enact. The DOE has had the authority to set appliance efficiency standards since 1978 and is already required to ensure standards are cost-effective and technologically feasible. HRs 6192, 7637 and 7700 have passed the House but are unlikely to pass the Senate or be signed into law by President Biden.

Executive

The Department of Energy finalized energy efficiency requirements for residential water heaters. The rule is set to go into effect in 2029. The DOE estimates that the rule will save residential customers $7.6 billion per year on their energy and water bills.

The number of states challenging the Federal Energy Regulatory Commission (FERC)’s Order No. 1920 requiring long-term transmission planning continues to grow. On July 15, FERC essentially rejected all requests for a rehearing on Order No. 1920 by failing to respond within 30 days to the requests. Parties can now file appeals in court, and several already have. In the Midwest, the Public Utility Commission of Ohio filed a joint appeal with West Virginia in the 6 U.S. Circuit Court of Appeals. These challenges come in the wake of the Supreme Court’s overruling of the Chevron doctrine, which required courts to give deference to federal agencies interpretation of federal statutes containing any ambiguity. FERC may have a more difficult time defending the Order in the wake of this ruling.

FERC released Orders No. 1920 and No. 1977 on May 13 after a three-year rulemaking process. Order No. 1977 amends FERC’s sitting procedures. Order No. 1920 is likely to have significant impacts on long-term transmission planning. Some of the key provisions in Order No. 1920 include:

  • Requiring transmission providers to use a 20-year planning horizon, an increase from the prior 3–5-year planning timeline for projected new resources.
  • A more expansive list of seven benefits transmission providers must consider in evaluating each planning scenario.
  • Requires state input in the evaluation and selection of the long-term regional plans as well as a public explanation of why a project was or was not selected.
  • Changes to the cost allocation process including a requirement for transmission operators to hold a 6-month long stakeholder engagement period with relevant state entities.

Additionally, several groups have recently filed energy efficiency-related complaints at the FERC. The market monitor for Regional Transmission Organization PJM Interconnection has called for the removal of energy efficiency from PJM’s capacity market, claiming energy efficiency is not a dispatchable resource. Meanwhile, ratepayer advocates including the Illinois Citizens Utility Board along with four US Senators, filed a complaint against PJM at the FERC related to energy efficiency. The advocates and Senators argue that a PJM practice dating back to 2015 is preventing energy efficiency resources from fully participating in the capacity market. The complaint urges FERC to hold a technical conference on how to ensure energy efficiency resources are able to fully participate in wholesale energy capacity markets. FERC has not yet responded to the request for a technical conference.

On July 22, the EPA announced the Climate Pollution Reduction Grant (CPRG) program implementation grant awards to 25 states and metropolitan statistical areas (MSA), totaling $4.3 billion of funding across the nation. In MEEA’s 13-state region, 29 state and local governing bodies submitted Priority Climate Action Plans and 5 received implementation grants. Awardees include Illinois, Michigan, Minnesota, Nebraska and the Cleveland-Elyria, OH, MSA. These funds will be used to reduce greenhouse gas emissions through a variety of programmatic mechanisms, including energy efficiency financing and energy code advancement, with an emphasis on justice and equity.

The Biden-Harris administration is expected to announce an additional $300 million in CPRG implementation grant awards for Tribes, Tribal consortia and territories later this summer. That will be the final phase of CPRG implementation funding under current congressional appropriations.

The EPA also announced more than $325 million in Environmental and Climate Justice Community Change Grants for 21 projects. Midwest winners include two projects in Cleveland, MetroHealth System and Community Housing Solutions and The Trust for Public Land and See You At The Top, along with a $20 million grant the Midwest Tribal Energy Resources Association and Grid Alternatives to install home weatherization and energy efficiency upgrades across 35 Tribes in Michigan, Minnesota and Wisconsin.

How to Get Involved

Information about a number of federal funding opportunities can be found on the Funding Roundup page of MEEA’s website.

For more information about federal matters or to get more involved, contact Maddie Wazowicz

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resources

Recent Publications:

Recent Testimony and Comments:​

Recent Blogs:

 

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