The mayor of District of Columbia, Muriel Bowser, recently introduced legislation that would establish Green Bank for the District. The bill would create the “Green Finance Authority” as an instrumentality of the DC government to finance and promote the deployment of clean energy technology within the District. The Green Finance Authority will act as the DC Green Bank, and will offer a range of financing tools and programs to catalyze investment in clean energy. The Green Finance Authority will have separate legal existence from the DC government, and will not offer the full faith and credit of the DC government.
A Green Bank could change the game in the District of Columbia
This bill is the culmination of a multi-year Green Bank effort in DC. In June of 2015, the Coalition for Green Capital (CGC) signed a contract with the District of Columbia Department of Energy and the Environment (DOEE) to complete a study of a DC Green Bank. To complete the analysis, CGC worked in partnership with the DOEE and a large group of District stakeholders, including meetings and phone calls with policymakers, program administrators, clean energy advocates, lenders, contractors, and others to understand the clean energy landscape in the District.
CGC’s Green Bank study was published in April 2017 and concluded there was a very strong case for a Green Bank in the District of Columbia. The District has more than $3 billion clean energy project potential. The study estimated that over $1.4 billion of economically viable energy efficiency investments could be made in District buildings, and that up to $1 billion or more in investment in solar will be necessary for the District to meet the solar requirement in its renewable portfolio standard. The District of Columbia imports nearly all of its electricity, creating an enormous opportunity for DC to keep energy dollars in the state by investing in in-District energy resources. These conditions suggest that a Green Bank could dramatically improve the prospects for distributed clean energy technology in DC. As stated in the report:
The District has a clear and pressing need to stimulate more private investment in its clean energy economy to reach its climate and energy goals. … The District should establish a Green Bank, capitalized with public dollars, to leverage private investment, drive demand and increase access to clean energy. In combination with existing programs, the Green Bank can help District residents and businesses enjoy cleaner and cheaper energy.
DC is newest member of growing Green Bank movement
Through our work across the country and abroad, CGC is seeing snowballing interest in creating Green Banks as a tool for catalyzing more clean energy investment. Beyond the Green Bank activity in the District, there are efforts to create new Green Banks (at various stages of development) in Nevada, Ontario (province), Canada (federal government), South Africa, and Montgomery County Maryland. This growing interest is not surprising. At the end of 2016, US Green Banks had participated in over of $2 billion of clean energy transactions. And globally, Green Banks have already supported investments of $25.9 billion, using only $7.9 billion of their own capital!
With the bill in committee now, the next step is for the members to pass the bill into law. If DC Council passes the bill, the District would join states such as Connecticut, New York, and Rhode Island in having a Green Bank. Green Banks do not depend on federal policies to have a positive impact on local jobs and energy markets—Green Banks represent an important way for states and other sub-national governments to make an impact on emissions in the absence of federal leadership.