The Obama administration this week unveiled a programme to funnel billions of dollars directly into renewable energy projects, thus helping alleviate the capital crunch that has arisen as a result of the financial crisis.

The programme, announced jointly by the US Energy and Treasury departments, basically monetizes existing tax credits that subsidize development of wind, solar and other renewable resources. The way these deals worked in the past is that banks would finance individual projects and then take advantage of the tax credits themselves. But because these credits reduce taxes that would normally be paid on profits, they are completely useless if banks aren’t making any money, as is currently the case.

Nature covered this problem back in October, when the impacts of the financial meltdown on Wall Street were just beginning to emerge, and again in January. The renewable energy industry seized on the issue and pushed to make the tax credits available as cash when Congress was working on a stimulus bill; their efforts paid off, and this week’s announcement kicks off the new programme.

The Energy Department hopes to begin accepting applications on Aug. 1; checks would be cut within 60 days of submission. Agency officials estimate demand at roughly $3 billion (enough to get $10 to $14 billion in projects off the ground) but said there is no ceiling on the subsidy. “The real question is just how many projects come in,” says Matt Rogers, who is working on the stimulus program at the Energy Department. “Three billion is the initial estimate, but we would be quite excited to see a number larger than that.”