Defining and Prioritizing Disadvantaged Communities

The White House’s Justice40 initiative includes a goal that 40 percent of all benefits of federal investments and grant programs flow to disadvantaged communities “that are marginalized, underserved, and overburdened by pollution.”

Federal agencies are still defining and identifying areas that count as disadvantaged communities (DACs). Smart Electric Power Alliance (SEPA) has identified an opportunity to learn and discover the unique needs of the varying federal agencies and definitions. This is our attempt to provide key industry stakeholders with a look at the federal government’s views of these definitions.

The Climate and Economic Justice Screening Tool

The White House directs all federal agencies and entities to use their mapping tool, called the Climate and Economic Justice Screening Tool (CEJST), by October 2023. The mapping tool helps identify and prioritize disadvantaged communities for federal funding.

CEJST follows in the footsteps of CalEnviroScreen and the U.S. EPA’s EJScreen. In the early 2010s, these tools ushered in the modern era of large-scale, public, interactive digital maps to identify relative burdens and focus programs and investments. In the decade since, many states, federal agencies, programs, and even private entities like utilities have developed their own maps and analyses. It’s both a blessing and a curse that there are now so many ways to understand, measure, and display the distribution of community burden in the United States.

Navigating the Mixing Zone

As these federal agencies receive directives on how to allocate program funding, state energy offices and utilities can make better decisions on where and how to combine or target disadvantaged communities. SEPA recently conducted a landscape review and examined the similarities and differences across several key equity mapping tools that have been published by federal agencies within the year, including their underlying assumptions and definitions. This blog shares insights from the research and key trends to watch in 2023 as grant administrators and applicants make the case for clean energy investments within DACs.

Program staff and policymakers have several existing resources to choose from when looking to assemble a mapping toolkit to help them identify and define DACs.

• White House CEQ’s CEJST definition of disadvantaged communities
  • Description: Designed to identify areas that would benefit from the 40% of Justice40 initiative investments intended for disadvantaged communities. A census tract is considered disadvantaged if they meet the thresholds for one of the tool’s categories of burden OR the tract is completely surrounded by disadvantaged communities and >= 50th percentile for low income
• U.S. EPA EJScreen: Environmental Justice Screening and Mapping Tool
  • Description: Each census tract is given a percentile for each index in EJScreen, they do not provide a threshold for “underserved” but do highlight those areas in the >= 95th, 94th – 90th, and  89th – 80th percentile groups
• U.S. DOT Definition of “Historically Disadvantaged Community”*
  • Description: The percentile value for 22 indicators is calculated for each census tract, and those percentiles are averaged across six categories to get summarized percentile values. If a tract is  >= 50th percentile in a category it is given a value of 1, and all 6 categories are summed, giving each tract a score from 0-6. A score above 4 is considered disadvantaged.
• U.S. DOE Energy Justice Mapping Tool – Disadvantaged Communities*
  • Description: The percentile value for 36 burden indicators is calculated for each tract. These percentiles were summed across indicators where the higher final score would represent the greatest disadvantage. A census tract must rank in the 80th percentile of the cumulative sum and have at least 30% of households classified as low-income.
• IRA-defined Energy Communities
  • Description: 10% additional financial incentives if projects are within an “energy community.” These include brownfields, coal communities, and areas with jobs and tax revenue tied to fossil fuels. The “Energy Community Tax Credit Bonus” is intended to support and revitalize the economies of coal and power plant communities.
    * = Includes metrics from U.S. EPA EJScreen, and was created as part of interim Justice40 implementation guidance. Federal agencies may continue using these tools in the short term, but in early 2023 were asked to use the CEJST as their primary tool for Justice40 Initiative implementation.
• CDC/ATSDR Environmental Justice Index
  • Description: Census tracts are ranked on 36 factors that are grouped into 3 domains.  Percentile ranks for each indicator are summed across the 3 domains, and these scores were ranked giving each tract a score between 0-1, representing their relative burden/vulnerability.

We’re Still Defining “Disadvantaged”

SEPA conducted a comparative analysis of the common indicators of burden to help government agencies and stakeholders better understand each of these mapping tools and definitions and ultimately make better decisions when targeting investments in disadvantaged communities.

Federal Definitions at the State Level

SEPA has been supporting one of our state energy office members, North Carolina Department of Environmental Quality (NC DEQ), in navigating these federal DAC definitions to:

• Determine how well they have been targeting state-led programs within DACs
• Understand the coverage of federal DAC definitions in North Carolina
• Align state DAC definitions with federal DAC definitions
• Develop an interactive mapping tool to allow state administrators and public stakeholders to utilize in justifying future projects across the state.

Key Takeaways:

• The Executive Office released a frequently asked questions (FAQ) document which clarifies how they see CEJST relating to the EPA EJ Screen, why states vs. federal datasets are different and each serve a role, and how the tool be used to inform decisions relating to new investments made through the Bipartisan Infrastructure Law and the Inflation Reduction Act.
• The concepts of cumulative burden are introduced throughout many of the screening criteria and datasets. The trend in these emerging criteria is to include more indicators of burden, covering a wider and more comprehensive view of what “disadvantaged” means beyond traditional socioeconomic factors.
• The tools are best used for screening-level analysis and applying for grant funding. Ground-level efforts are then necessary to identify the proper community leaders and community-based organizations to engage.
• There is a broad range of indicators that are used across the definitions – socioeconomic factors are the most used, and climate change risks are the least used. For example, poverty, low income, and unemployment rate are specific indicators of burden which consistently show up, while fossil fuel reliance and energy reliability and cost only show up in a handful of definitions.
• The U.S. DOE definition of disadvantaged communities has the most indicators of burden and is evenly distributed amongst the burden types. This definition also includes the most unique indicators of burden at 19. The CDC, U.S. DOT, and White House definitions also include a variety of indicators at 17, 15, and 15 respectively.
• In addition to the variety of indicators that are included within each definition, there are differences in the degree these indicators must be present in the census tract, or how they are measured to be considered disadvantaged. For example, the EPA EJScreen uses the percent of households under 2x the national poverty level while the DOT definition uses the percent at or below the area median income.

With the increased focus on prioritizing federal investments within DACs, it’s that much more important for utilities and prospective grant applicants and administrators to fully understand what the requirements are. It’ll be critical to keep an eye on these definitions as they evolve so they can be used properly in stacking benefits to disadvantaged communities.

Next Steps:

• Utilities can begin overlaying DACswith their grid infrastructure to stay ahead of policy directives and to justify future investments and grant projects.
• State agencies can begin overlaying DACs with their state-specific programs and existing state definitions to ensure they are targeting the DACs and have alignment with federal definitions and grant programs.
• Public utility commissions can begin overlaying DACs with their regulatory directives to inform new regulatory initiatives and decision-making.
• Third-party developers and technology providers can begin overlaying DACs with their existing and pipeline project footprints to better understand new and emerging markets, as well as grant opportunities.

With the increased focus on prioritizing federal investments within DACs, it’s that much more important for utilities and prospective grant applicants and administrators to fully understand what the requirements are. It’ll be critical to keep an eye on these definitions as they evolve so they can be used properly in stacking benefits to disadvantaged communities. It is imperative to clearly lay out all of the disadvantaged community boundaries and definitions, understanding they are evolving and are continuing to be shaped in future year updates. While nothing replaces the voice of community members, looking at data, federal definitions, and mapping tools is extremely important for these entities to prioritize investments in disadvantaged communities.

To learn more about SEPA’s resilience and equity work, please contact Jared Leader at [email protected].