Green banks finance clean energy despite funding cuts
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Across the United States, green banks are funding clean energy projects despite losing federal support from the Trump administration and delays under the Biden administration.
These banks use public funds to encourage lending for projects, like community solar installations and affordable housing with energy efficiency upgrades, that private lenders often avoid due to perceived risk.
In 2024 and 2025, 48 green banks deployed $1.4 billion of their own capital, attracting an additional $11 billion from private investors for over 40,000 projects. The U.S. Green Bank 50, a coalition of these institutions, reported that while the loss of $20 billion in funding from the 2022 Inflation Reduction Act hampered their plans, they continued to find alternative financing.
The Trump administration terminated the funding, and while courts ruled against the freeze, the Biden administration is appealing those decisions. Green banks address risks traditional lenders avoid by working with customers like affordable housing providers and solar developers in low-income communities. They also pool funds from multiple lenders and share technical resources to reduce costs, allowing them to attract private capital after demonstrating project viability.
For example, the Solar and Energy Loan Fund in Florida developed a platform used by 13 other lenders to standardize underwriting and loan processing, saving them significant expenses. Montgomery County Green Bank in Maryland recently launched a $4 million initiative offering low-interest loans for homeowners to install solar panels and heat pumps.
