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Those organizations are already doing the work the EPA wants done. So funding them is basically like any other government contract. I've haven't read the whole details, but as with most government grants, there are almost certainly strings attached and milestones that need to be met.
It's essentially the EPA equivalent of NASA funding SpaceX and Boeing.
It may be both.
It could be both helping save the environment and siphoning public funds into a buddy's pocket.
I see your confusion. They could have worded this better, but it's two grants being split between eight nonprofit financial institutions. My understanding is these entities will lend that money to communities to do ongoing infrastructure projects. The goal is "turning $20 billion of public funds into $150 billion of public and private investment to maximize the impact of public funds." I don't know how that part works exactly, but to me that doesn't sound like a handout. Of course I would hope they would be held responsible for any mismanagement.
As for why they need to create a financial nework to do this: These kinds of projects can take many years and sometimes need ongoing financing. Apparently, when Obama tried to fund something like this, there was a lending bottleneck where I guess banks didn't want to finance community infrastructure projects or something, so a lot of the funding just sat there until the grants expired. This is supposed to prevent that from happening.