On Friday, CGC submitted a response to the New Jersey Economic Development Authority’s Request for Information on a “Potential Green Financing Mechanism to be Established by the State of New Jersey.” The full response can be viewed here.
New Jersey has been making steady progress towards the creation of a transformative Green Financing Mechanism (aka a Green Bank). Most recently, the state announced a $12 million annual commitment to fund the institution through allocations from RGGI. CGC has been engaged in New Jersey for several years, beginning with starting with a 2018 analysis of the clean energy finance opportunity in New Jersey produced by the Environmental Defense Fund and CGC.
CGC’s response highlights the ability of a Green Bank to make progress on critical priorities. The largest sources of emissions in New Jersey are transportation, power and buildings. While lowering emissions in these sectors is essential, maintaining or lowering the cost of energy to New Jersey households and businesses is equally critical. This is truer now more than ever, as households struggle to make ends meet. The essential role of the Green Bank is to provide its financing in a way that can still attract private capital that earns its necessary return while also delivering affordable clean energy.
Furthermore, over a million workers in New Jersey are out of work, many from industries that will not soon bounce back and create jobs to rehire. That means the state must look to reshape its labor force and give its citizens new, better jobs of the future with good pay in safe condition. Construction of the state’s clean power platform requires people of all skills. Sales, customer service, marketing, engineering, contracting and other skills are needed. The Green Bank can be the vehicle to put New Jersey back to work again.
With funding commitments in place, the RFI is the next step in further clarifying the process for bringing a Green Bank to life in New Jersey. Based on prior engagement with stakeholders in the state, CGC’s response recommends forming the Green Bank as a program that is housed, launched and incubated within the EDA, and which is ultimately able to stand on its own as an independent non-profit corporation. This would let the Green Bank enjoy the best of both worlds: the benefits of strong backing by the state at its inception, while ensuring it can operate independently and with strength long into the future as administrations come and go.