What is a Green Bank?



A Green Bank is dedicated public or non-profit finance entity designed to drive private capital into market gaps.

  • A finance institution dedicated to increasing and accelerating investment in clean power goods and services.
  • Its mission is to use finance tools to mitigate climate change.
  • Unlike typical “banks” it does not take deposits, and its operations can be funded by governments or charitable contributions or both.
  • It may deploy capital from public or private sources, invest on its own or in conjunction with private sector investors.

As focused institutions with specialized market and financing know-how, Green Banks are able to spark greater public and private clean energy investment. Green Banks use a range of techniques and approaches to engage market actors and capital providers, bridging market gaps that allow capital to flow at scale.

Several organizations, including the United States Department of Energy (DOE) and the Organization for Economic Cooperation and Development (OECD), have recently published papers on the subject of Green Banks, available below.

CGC GB white paper CGC: Green Bank White Paper
OECD GIB paper OECD: Green Investment Banks – Scaling up Private Investment in Low-carbon, Climate-Resilient Infrastructure
Brookings GB paper  

Brookings Institute: State Clean Energy Finance Banks – New Investment Facilities for Clean Energy Deployment

 

DOE EIP paper U.S. DOE: Energy Investment Partnerships – How State and Local Governments Are Engaging Private Capital to Drive Clean Energy Investments