First MnCIFA loan goes to new net-zero community

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Matt Doll, Minnesota Environmental Partnership

Right now, my neck of the woods on the East Side of Saint Paul is home to a 112-acre lot made up of ravines and hills of dirt. Day after day, excavators haul and move dirt around this former golf course, preparing to fill the site with roads, utilities, buildings, and green space.

The sights and sounds of excavation are no annoyance to me – quite the opposite, in fact: they’re visible signs of progress on the Heights, a development that Saint Paulites hope will be one of the first net-zero communities in the nation. (I gave a presentation to the Minnesota Renewable Energy Society on this topic in 2022.)

That hope took a big step toward realization this week as the Minnesota Climate Innovation Finance Authority (MnCIFA) announced its first-ever loan would go toward building a geothermal district heating and cooling system for the Heights. Covering $4.7 million of the project’s cost, this funding will help achieve the site’s net-zero goal and provide completely clean, low-cost temperature control to residents and businesses. It’s a welcome victory for community advocates and organizations like Saint Paul 350, who have advocated over the past few years for carbon-free climate control in all of the Heights’ buildings.

A new tool for climate and equity

Establishing MnCIFA was one of the environmental community’s key legislative wins in the 2023 Session. The Legislature passed a total of $45 million in starting funds for the new independent agency, which is governed by a board that includes representatives from labor, Tribal communities, state agencies, and climate justice advocates.

MnCIFA, which essentially acts as a “green bank,” is designed to help climate action projects that may face obstacles to traditional financing get off the ground. It aims to target assistance to underserved and low-income communities and build local careers in areas where projects are funded.

It would be hard to find a more tailor-made candidate for MnCIFA funding than the Heights. The Greater East Side community in which the project sits is working-class and one of Minnesota’s most diverse. The project’s backers at the City of Saint Paul and the Saint Paul Port Authority anticipate building 1,000 housing units of varying density – with an emphasis on affordability – and generating roughly 1,000 living-wage jobs in the site’s light industrial spaces. Equity and sustainability have gone hand-in-hand through the project from its earliest days.

MnCIFA’s funding will help the Heights tap into the aquifer below the landscape for heating and cooling, taking advantage of the aquifer’s consistent temperature to pump heat upward during the winter and pump it downward during the summer. By networking the community’s multifamily residential buildings and industrial facilities into a singular heating and cooling grid – similar to downtown Saint Paul’s District Energy – the entire system will run at high efficiency. It will keep residents and workers safe and comfortable without the unpredictable cost, emissions impact, or safety hazards of using natural gas, which most buildings in Minnesota currently rely on.

MnCIFA’s first-ever loan won’t cover the entire cost for this system, but it will fund it at the critical early stage, making it possible to access private sector funding to cover the rest.

Throughout this year, I’ll watch as utility workers run new water and power lines, Habitat for Humanity and construction partners build new homes, and landscapers start to lay the groundwork for restored wetlands and parks. I look forward to seeing solar panels blossom across the buildings’ rooftops, a visible sign that this nearly carbon-free community will be powered by the sun from above and the earth from below, no longer reliant on fossil fuels.

I – along with my colleagues and coalition members at MEP – also look forward to seeing the next projects MnCIFA chooses to support. Our legislative efforts in 2023 to create the agency are bearing fruit in exciting ways, helping build a transition to clean energy in Minnesota that leaves no community behind.

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