A new authority from the Bipartisan Infrastructure Law exempts projects receiving financial support or credit enhancements from an eligible state energy financing institution (SEFI). Previously, all projects funded under Title 17 were required to employ technologies that were new or significantly improved compared to commercially available technologies. Now, projects that reduce greenhouse gas emissions without using an innovative technology may be eligible for loans under Title 17, so long as the projects receive qualifying funding from a SEFI (e.g., a state green bank or other qualifying state entities) and fall into one of the categories of eligible projects under Title 17.  

Congress enacted this change to Title 17 in part to provide access to debt for borrowers seeking to deploy already commercialized clean energy technologies. By providing loan guarantees to SEFI-supported projects (which can include guarantees of loans made by eligible private lenders), the Loan Programs Office (LPO) can now offer project financing to a wider range of borrowers under Title 17, including small, rural, and underserved communities.

A SEFI is an entity established by a state, Indian Tribal entity, or Alaska Native Corporation to provide financing support or credit enhancements for eligible clean energy projects and to take steps to reduce financial barriers to the deployment of eligible clean energy projects. City and county agencies will generally not qualify as SEFIs.

LPO also outlines below the steps that States and other eligible organizations should follow to be considered a SEFI.

Additional program details and application requirements are described in the Title 17 Clean Energy Financing Program Guide and on the Title 17 Overview web page.

The expanded authority was established by the Bipartisan Infrastructure Law and funded by the Inflation Reduction Act (IRA). The IRA provided an additional $40 billion of loan authority for projects eligible for loan guarantees under section 1703 of the Energy Policy Act of 2005, and that authority will remain available through September 30, 2026.

The SEFI-related authority broadens the scope of projects LPO can finance under Title 17 and will further advance private sector-led, government-supported efforts to reduce greenhouse gas emissions.


Typographic image explaining that the innovative technology requirement has been waived for Title 17 Clean Energy Loan Guarantee projects that receive financial support or credit enhancements from a SEFI.
Typographic image that provides examples of potential SEFIs, such as Housing Finance Agencies, Economic Development Authorities, State Green Banks, and State Energy Offices.



In addition to the common eligibility requirements that apply to all Title 17 Clean Energy Financing projects, SEFI-Supported projects must consider the following:

  • SEFI-Supported projects must align with one of the following eligible technologies: 
  1. Renewable energy systems 
  2. Advanced fossil energy technology 
  3. Hydrogen fuel cell technology 
  4. Advanced nuclear energy 
  5. Carbon capture and sequestration technologies 
  6. Efficient electrical generation, transmission, and distribution 
  7. Efficient end-use energy technologies
  8. Production facilities for the manufacture of fuel-efficient vehicles or parts of those vehicles  
  9. Pollution control equipment 
  10. Oil refineries 
  11. Energy storage technologies 
  12. Industrial decarbonization technologies 
  13. Supply of critical minerals 
  • SEFI-Supported projects must receive meaningful financial support or credit enhancements from a SEFI.
  • Federal Support Restriction: Like all Title 17 projects, SEFI-Supported projects may not utilize federally appropriated funds for the repayment of a loan guaranteed by LPO. The fact that a SEFI receives federal support at an organizational level or for unrelated projects may not disqualify the proposed project so long as the federal funding does not directly or indirectly support the proposed project.


What are the legal criteria for an organization to become a SEFI?

Many states will have several entities that would qualify as SEFIs. State, Tribal or Alaska Native entities that are considering providing SEFI support to projects should identify statutory language and references and consult with LPO through a pre-application process. LPO will make determinations about SEFI eligibility consistent with the following statutory requirements:

  1. State Recognition: The jurisdiction of the organization must be recognized as a "State" within the meaning of 42 U.S.C. 16511(7) and section 202 of the Energy Conservation and Production act, 42 U.S.C. 6802 (this extends to US territories, for example).
  2. Entity Establishment: The term “State energy financing institution” means a quasi-independent entity or an entity within a State agency or financing authority established by a State.
  3. Purpose and Function: The organization must be established to provide financing support or credit enhancements for eligible projects and to create liquid markets for eligible projects or take other steps to reduce financial barriers to the deployment of existing and new eligible projects. (Note that many states entities have had their eligible purpose established through amending legislation.)

“State energy financing institutions” also include entities or organizations established by Indian Tribal entities or Alaska Native Corporations for the purposes described in clause (3) above.



Examples of qualifying project participation by a SEFI may include, but are not limited to: 

  • Providing equity/subordinate portion of capital stack  
  • Providing loan loss reserve with respect to junior portion of capital stack
  • Co-lending with LPO (pari passu or mezzanine)   
  • Providing financial backstop for specific key project elements that may be subject to regulatory or local market risk   

Statewide policies, such as Renewable Portfolio Standards (RPS) typically will not constitute meaningful SEFI support for a project.

A wide range of clean energy projects may qualify for LPO financing through the SEFI-Supported category. The following is a set of project types that could be eligible, subject to LPO review. These examples are neither exhaustive nor limiting.

  • SEFI-supported energy efficiency upgrades and electrification of single-family residences
  • SEFI-supported community solar projects
  • SEFI-supported facilities related to decarbonized industrial products
  • SEFI-supported construction of high-quality, energy-efficient, housing
  • SEFI-supported financing of energy efficient and grid-interactive appliances



The following scenarios represent example projects and funding structures that might be eligible for a loan from LPO under this authority.

Example 1:  A private lender provides debt financing and servicing to small businesses that acquire, renovate, and rent or re-sell mid-market single-family homes. The small businesses use the proceeds to install on-site renewable energy generation, build EV infrastructure, and improve the overall energy efficiency of the homes. Several state energy offices provide subordinated debt capital or loan loss reserves for the project. The lender seeks a loan guarantee from LPO for senior debt used to originate or purchase the portfolio of small business loans.

Example 2:  A community solar developer is constructing multiple solar facilities. The project portfolio has SEFI funding in the form of up-front state grants, which the developer receives for serving certain geographic areas of the state. The developer may be eligible to receive additional state grants if it serves lower- and moderate-income and disadvantaged communities. The developer applies for an LPO SEFI loan guarantee to support deployment of solar facilities. The developer repays the loans for facility construction through customer subscriptions. The developer would like LPO to guarantee a multi-draw construction loan or similar facility used to finance the portfolio.

Example 3:  A state has invested in a project to transport natural gas for use in production of blue ammonia. The developer secured SEFI support for electrolyzer facilities to complement existing state-backed blue ammonia infrastructure. Because the project receives SEFI support, the developer explores a guarantee for the new infrastructure under Title 17. In addition to providing financing for the electrolyzers, a loan guarantee from LPO would come with valuable technical expertise.

Example 4:  A private developer builds residential housing projects to high energy efficiency standards. As a result, the state housing finance agency provides grants and credit enhancement for the construction, potentially making the developer’s projects eligible for a loan from LPO under Title 17. The developer mentions this to the state housing finance authority, which also supports dozens of other developers. The SEFI decides to bundle projects from multiple developers into a single application to LPO. The SEFI seeks a loan guaranteed by LPO to further incentivize developers to prioritize energy efficiency in new buildings.

Example 5:  A company finances the purchase of energy-efficient appliances through an online utility marketplace platform and provides point-of-sale rebates for customers throughout the United States. In several states, the company developed loan-loss reserve (LLR) programs with state energy offices. The LLR programs cover a significant portion of qualifying losses resulting from consumer loan defaults, which are infrequent. The company seeks a loan guaranteed by LPO to scale up its service offerings and make more loans available to consumers in states where it receives SEFI funding.

Watch this National Association of State Energy Officers webinar to learn from LPO leadership and state peers about how LPO’s new authority can benefit your state.



LPO has a dedicated team for State Energy Financing Institution projects. If you have a project that may be eligible for financing through the State Energy Financing Institution-Supported project category, please request a no-cost pre-application consultation. LPO encourages interested parties to begin the application process as soon as possible.


Jigar Shah
Director of the Loan Programs Office
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