What Can EPA's Climate Grants Tell Us about State Conservation Priorities?

​​​​​​Insights Into State Conservation and Agriculture Greenhouse Gas Reduction Priorities from EPA’s Climate Pollution Reduction Grants Program

When The Nature Conservancy (TNC) received notification of $200 million in grant funds towards improved forest management, peatland restoration, and tidal wetland enhancement in the Mid-Atlantic earlier this year, it wasn’t just the historic size of the grant that was so eye-catching. It was also the source. The grant for a suite of conservation and restoration activities, part of a larger $421 million award to four states and the TNC chapters in them, came not from more typical conservation funding sources like the U.S. Forest Service, but instead from the Environmental Protection Agency’s Climate Pollution Reduction Grant Program (CPRG). In September 2024, U.S. EPA announced the second of two rounds of implementation grants that will allocate the remainder of the $5 billion available through the CPRG program. 

This one-time program, funded through the 2022 Inflation Reduction Act, asked states, municipalities, tribes, and territories to think holistically about climate mitigation planning, center equity, and consider co-benefits in order to reduce greenhouse gas emissions. Applicants were asked to quantify the emissions reductions associated with sector-specific measures over time. The resulting Priority Climate Action Plans (PCAPs) therefore reveal how jurisdictions envision the Natural and Working Lands (NWL) and Agriculture sectors contributing to emissions reduction goals and how programs for implementation might be structured. (1)

One-fifth of the $4.6 billion of CPRG implementation grants were awarded to NWL and Agriculture priorities. While the details of these grants haven’t yet been finalized by EPA and recipients, what is known suggests that they will demonstrate how NWL and Agriculture climate action can be scaled through focused investment. For more information about the CPRG process, see the bottom of this article. 

Natural and Working Lands and Agriculture in State CPRGs 

PCAPs and implementation grant awards offer a glimpse into the current state of comprehensive climate action planning in 45 states (plus Puerto Rico and the District of Columbia), 82 metropolitan areas, four territories, and more than 200 tribes. As such, they are a valuable source of data on the role that land conservation, management, and restoration might play in jurisdictional GHG mitigation programs. States’ CPRG submissions do not necessarily represent the full scope of their climate goals and initiatives.  

State climate action planning for NWL is not limited to this relatively new CPRG program. For example, at least 20 states include NWL in their existing statewide climate action plans or have NWL-specific climate plans. Seven states have quantitative GHG emission reduction targets for NWL, and others have quantitative acre-based targets (e.g., 30x30 goals) or qualitative conservation goals (e.g., manage for climate resilience).  

The content of the PCAPs was strategic: “[States] were very discerning about the fact that their implementation grants be considered holistically - not cherry picking from PCAP, but building the PCAP with an eye to implementation grant applications,” said Matt Creasy, Natural and Working Lands Specialist with the Great Plains Institute, which provided technical assistance to some states in preparing PCAPs and implementation grant proposals. NWL priorities whose quantification methods might weaken the grant proposal were therefore removed in some cases. 

My firm analyzed state PCAPs and publicly accessible information on implementation grant awards and spoke to select grant recipients and third-party technical assistance providers. The results, in the context of other state climate action related to NWL and Agriculture, yield some take-aways: 

NWL and Agriculture can compete for federal funds on par with the energy sectors.
EPA awarded $966 million to NWL and Agriculture priorities put forth by states, municipalities, territories, and tribes. Agriculture and NWL implementation grants are listed on EPA’s CPRG website. The fourth-largest CPRG implementation grant across all sectors is the $421 million grant to the Atlantic Conservation Coalition, a consortium made up of four states (North Carolina, South Carolina, Maryland, and Virginia) and The Nature Conservancy. The third-largest grant overall, to Illinois for emission reduction measures across multiple sectors, includes funding to support climate-smart practice adoption on 300,000 acres of farmland. Ten out of the 25 grants in the general competition included or were focused on Agriculture and NWL; six out of 34 in the tribes & territories competition included Agriculture and NWL. ⁽²⁾ The Nebraska Department of Environment and Energy received its largest-ever federal award ($307 million), at least 70% of which is expected to fund agricultural GHG reduction priorities, according to Sarah Starostka, Planning and Aid Division Administrator with the Nebraska Department of Environment and Energy.  

States aren’t shying away from targeting GHG reductions from NWL and Agriculture.
Three-quarters of states (including Puerto Rico) include either Agriculture or NWL priorities in their PCAPs or both. This is true across red and blue states and is notable given what we heard regarding the challenges of quantifying GHG reductions. We see this as a sign that these sectors are maturing into fully integrated components of statewide GHG reduction strategy after years on the periphery. Outside of CPRG, at least seven states have set quantitative GHG mitigation targets for NWL, and others have established acre-based conservation goals and other, qualitative targets.  

States envision using existing and new programs and mechanisms to realize GHG reductions within current agency authorities. The NWL measures rely on the traditional pathways of land conservation, restoration, and improved management of private and public lands. For example, state agencies and TNC chapters participating in the Atlantic Conservation Coalition will pursue a mix of permanent protection via acquisition and conservation easements and restoration that is expected to increase carbon sequestration. Priorities are set at the state level, and large-scale ecological uplift is one of the goals, alongside co-benefits including climate resilience. 

“From TNC’s perspective, we looked at where we could get in the ground fastest,” said Debbie Crane, Director of Communications for The Nature Conservancy in North Carolina. Grant-supported efforts in North Carolina will focus on conserving and restoring pocosin and other peatlands and coastal areas, said Crane. “South Carolina will focus on bottomland hardwoods and longleaf pine. Virginia and Maryland are both looking at restoration in the Appalachians and Virginia is also looking at salt lands.” TNC chapters across the four states will each receive $50 million, with states receiving the remainder of the grant. 

Agricultural measures tend to lean on established climate-smart practices and technology adoption on farms, ranches, and livestock operations, often referencing U.S. Department of Agriculture (USDA) Natural Resources Conservation Service (NRCS) guidance and relying on USDA GHG quantification tools like COMET Planner (an online tool that estimates GHG sources and sinks associated with adoption of climate-smart practices). As with NWL activities, implementation would flow through agencies under existing authorities, expanding programmatic scope or budget to achieve targeted reductions in some cases.  

CPRG created an incentive to seek out transformational change. Nebraska, for example, will develop a new program to catalyze GHG reductions at scale by driving value to producers. “We’re trying to create the market at the producer level, so that they have a buy-in and can feed into that larger overall market,” said Starostka. The Department of Environment and Energy plans to develop the Nebraska Agricultural Registry and Grants Program, which would rely on carbon intensity scores as the “core driver for the implementation of these [regenerative and precision agriculture] practices” and “our direct measurement of whether or not we’re reducing greenhouse gas emissions,” said Starostka. Starostka anticipates a sub-award to an external organization to develop and manage the program, including formation of a governance council composed of state agricultural leaders and state agencies. “We do want to set some industry standards here in how we provide options for those producers and growers in how they capture value,” added Thad Fineran, former Interim Director of the Nebraska Department of Environment and Energy. Officials anticipate that this initiative will increase the competitiveness of Nebraska agricultural products and attract new business to the state. 

Forests are the focus of NWL strategies.
We reviewed state PCAPs to look for trends within the NWL and Agriculture sectors. Forests had a high profile among states’ NWL priorities. Figure 1 illustrates this count across state PCAPs.  

Forest priorities can be disaggregated into more granular pathways; see Figure 2.⁽³⁾ Each of these mechanisms can be further subdivided to better understand what states are prioritizing. For example, see Figure 3 for a breakdown of the activities rolled into “tree planting”. These priorities are not necessarily mutually exclusive within a given PCAP or priority. 

   

It is clear from this that states are focusing on forests to deliver results and that adding trees to the landscape, whether in urban or rural areas, is seen as the most viable forests strategy. However, readers should remember that these are the priorities in the context of the CPRG program, which puts a premium on quantifiable GHG mitigation and cost-effectiveness. Specific reforestation or other tree planting measures seemed to be generally easier to quantify, and forests may have been seen as less risky than other natural land types because states were able to draw on USDA Forest Service Forest Inventory Analysis (FIA) data and decades of published literature on forest carbon sequestration.  

In addition to the focus on forests, states identified GHG mitigation priorities related to all of the land types and uses that form the core of natural climate solutions. Peatlands had a noticeably high profile, with both Minnesota and North Carolina receiving implementation grants explicitly for peatlands conservation and restoration. Priorities include supporting strategies like biomass utilization to reduce emissions and carbon markets, which two states noted as complementary sources of finance for forest activities.  

Agricultural priorities are diverse and target the major sources of emissions in this sector. 
More than half of the states submitting PCAPs identified Agriculture GHG reduction priorities. This is notable, given the general conception that this is a “hard to abate” sector and the politics of climate change in some states with large agricultural constituencies. Eight out of the top 10 ag states prioritize agriculture in their PCAPs (Iowa (#2) state government didn’t participate in CPRG at all).  

Priority strategies target methane and nitrous oxide emissions from livestock and nitrous oxide emissions from soil management, in addition to soil carbon. Methane and nitrous oxide make up 98.6% of Agricultural GHG emissions in EPA’s inventory, so focusing on these sources is essential to bringing down emissions in this sector.⁽⁴⁾ Figure 4 shows the Agriculture priority count in state PCAPs.  

 

CPRG implementation grants are only one piece of the climate finance puzzle.
EPA stipulated that CPRG grants could not be used to displace existing sources of public funding but could be used to expand the scope or scale of implementation. The implementation grants are therefore necessarily complementary to other sources of local and federal public investment and private sector co-investment.  

CPRG responses highlight the necessity of federal grant funding and other incentives. CPRG funds are seen as expanding the reach of USDA NRCS Conservation programs that are focusing additional IRA funds on climate-smart agriculture and forestry practices, like the Environmental Quality Incentives Program and Conservation Stewardship Program. Several states identified the USDA Forest Service’s Urban and Community Forestry and Forest Legacy programs as essential to advancing priorities. IRA investment and production tax credits are also viewed as potential support for Agriculture priorities with an energy linkage. Thad Fineran in Nebraska sees their anaerobic digester/ biogas hubs priority as providing direct value to the energy system: “How do we best capture a byproduct and create a product chain out of that?” While he said that it’s “too early to speculate” on what private investment might look like, he noted that the new programs supported by CPRG grants are expected to create new business opportunities in the state.  

All states have their own funding to support aspects of their PCAP priorities, and these vary widely in their source, scale, and inter-annual variability. It is clear from the interest in CPRG implementation grants that states will need significantly more public and private investment to implement their NWL and Agriculture priorities. According to the Trust for Public Land’s LandVote database, California, Minnesota, and Rhode Island have natural resource bonds and lottery revenue expenditure plans totaling $13.23 billion on the ballot this year. The lion’s share of that is California’s Proposition 4, also known as “the climate bond”. Financing implementation is not a challenge unique to the NWL and Agriculture sectors, but these sectors lack the far-reaching government mandates that have spurred private investment in the energy sector, such as renewable portfolio and fuels standards and vehicle tailpipe emissions standards. 

Local and national NGOs will continue to be much-needed implementation partners, providing technical assistance, transaction support, and additional funds. The Nature Conservancy, for example, plans to fundraise to grow the scale of implementation beyond what will be supported through CPRG. “There’s still a whole lot of peat that can be restored,” said Debbie Crane. 

The future of federal funds for NWL and Agriculture GHG mitigation is also in flux. Next week’s federal (and state) elections will certainly impact the availability and use of climate funding. The CPRG itself is a one-time program. There is much speculation as to whether it will continue, in one form or another, into the next Administration. Farm Bill negotiations will determine whether a portion of IRA funds are added to the Farm Bill baseline going forward and whether the climate-smart spending requirement will remain intact. High demand for new, climate-focused federal funding and the scale of implementation grant requests indicates that we are nowhere near the public funding levels necessary to support “full implementation” of NWL and Agriculture GHG mitigation strategies.  

Looking ahead, momentum for climate-smart conservation policy will depend on the answers to these questions, among others: 

• How will states and other jurisdictions refine and finance the NWL and Agriculture strategies that were identified through the CPRG process and their existing climate action plans? Does planning and prioritization lay the groundwork for developing new sources of state-level public funds through ballot measures and other avenues? 

• How will private sector capital mobilize to meet the conservation and climate-smart management needs of working forests and agricultural lands? Will states play a role in shaping commodity markets that deliver climate co-benefits? 

• How can we replicate and scale ecosystem protection and restoration quickly enough to preserve critical carbon stocks and adapt these systems to climate change in the absence of inherent profit motives? Are these ecosystem service markets, or something else?  

Fortunately, the environmental finance community is mobilizing to answer these questions through pilot projects, pipeline development, and systems thinking. We can make our efforts more effective by mapping these innovations to state, tribal, territorial, and municipal climate ambition. 

---

EPA’s Climate Pollution Reduction Grant Program 

The Climate Pollution Reduction Grant (CPRG) program was established under the 2022 Inflation Reduction Act and is intended to accelerate climate action planning and implementation across states, local governments, tribes, and territories. The one-time program offered non-competitive grants in 2023-2024 to support development of jurisdictional plans and strategies to reduce GHG emissions. Grantees were required to produce Priority Climate Action Plans, which were submitted to EPA in March 2024. As the name suggests, the PCAPs articulate strategic priorities for GHG reduction measures across sectors (electricity, transportation, agriculture, etc.). These measures must be “quantified,” in other words, they must include a calculation of the GHG emissions reductions expected to result from implementation, among other criteria.  

Those that completed PCAPs were then eligible to select near-term priorities to compete for EPA’s Implementation Grants beginning in the spring of 2024. The CPRG allocated $4.6 billion to 5-year Implementation Grants. The first round of grants - $4.3 billion to 25 state and municipal applicants - was announced in July 2024. The second and final round - $300 million to 34 applicants in a separate competition for tribes and territories - was announced in September 2024. The grants are expected to be awarded by the end of this year . EPA guidelines for use of funds are broad, and applicants were eligible to request funding for operational costs, land or equipment acquisition, loan disbursement, community engagement, planning, or project administration, among other things. Funds can be used directly by the applicants (states, tribes, etc.) or passed through to subrecipients for implementation.  

The final phase of the CPRG is the Comprehensive Climate Action Plan (CCAP) that every planning grant recipient must submit to EPA by December 2025. These will build on PCAPs and are expected to include near-term (2030-2035) and long-term (2050) GHG emissions reduction targets, including sector-specific targets where possible.  

---

Footnotes

⁽¹⁾ The CPRG planning process asked participants to identify sector-specific climate actions, including for the Agriculture sector and the Natural and Working Lands (NWL) sector. This article adopts this categorization. EPA’s award announcements bundled Agriculture and NWL implementation grants, but we delineated between the two because the state implementation partners, other actors, private-sector financing, and non-CPRG federal funding sources differ in ways that can be expected to impact implementation. 

⁽²⁾ U.S. Environmental Protection Agency. General Competition Selected Applications Table; Agriculture and Natural and Working Lands. Available online: https://www.epa.gov/inflation-reduction-act/general-competition-selected-applications-table, 

⁽³⁾ The total count is greater than the number of forest mentions in Figure 2 because some PCAPs prioritized multiple pathways. 

⁽⁴⁾ U.S. Environmental Protection Agency Greenhouse Gas Inventory Data Explorer. Available online: https://cfpub.epa.gov/ghgdata/inventoryexplorer/#agriculture/entiresector/allgas/category/current