The Clean Energy Future Blog

By Coalition for Green Capital

There is consensus in the climate community that investments to combat climate change must prioritize communities of color, front-line communities, fence-line communities, low-income communities, historically disinvested communities and rural communities and enable a just transition to a clean future.

Today, the Coalition for Green Capital is releasing a new white paper illustrating how a National Climate Bank would expand on the success of state and local green banks efforts to invest in these communities, while opening up entirely new pathways for job and business creation in the most climate impacted communities.

The report is part of a series from CGC which analyzes the potential impact of a National Climate Bank, providing details, context and recommendations on its workings.

The full white paper is available here. 

By Coalition for Green Capital

The Nicholas Institute for Environmental Policy and the Coalition for Green Capital hope to organize a nonprofit in the next several weeks to form the basis of a green bank to be called the North Carolina Clean Energy Fund.

The proposed fund would aim for $100 million to $150 million in capitalization to underwrite or help establish small clean energy and energy efficiency programs that ordinarily fail to attract support of traditional financial organizations.

“It is estimated that, with $100 million in seed capital, a Green Bank in North Carolina could create 15,000 jobs within its first five years with no other state or federal policy changes,” Weiss writes with Hanna Betnecke and Jill Bunting. “Not only that but as initial investments are repaid and then reinvested by the Green Bank, job creation would continue at approximately the same rate.”

Read the full story or read CGC’s Twitter thread about the story. 

By Coalition for Green Capital

DURHAM, N.C. — A North Carolina Clean Energy Fund would support economic recovery from the COVID-19 pandemic by equitably investing in clean and efficient energy solutions for the state, according to a new market assessment from Duke University’s Nicholas Institute for Environmental Policy Solutions and the Coalition for Green Capital (CGC). The fund could be seeded by a National Climate Bank, which has passed the U.S. House of Representatives with $20 billion, and now awaits Senate consideration.

The assessment estimates that $100 million in funding could catalyze private investment in clean energy and energy efficiency projects, potentially leading to creation of 15,000 jobs in North Carolina within the fund’s first five years of operation. For comparison, an estimated 21,000 clean energy workers, or roughly a fifth of the state’s pre-pandemic clean energy workforce, remained unemployed in North Carolina as of July. Any new jobs created by a Clean Energy Fund would support a range of projects to help meet the goals of the N.C. Clean Energy Plan — a 70 percent reduction in greenhouse gas emissions from the electric power sector below 2005 levels by 2030 and carbon neutrality by 2050.

“The North Carolina Clean Energy Plan reflects a consensus vision for combating climate change in our state while building a prosperous clean energy economy,” said Sushma Masemore, state energy director and deputy assistant secretary at the N.C. Department of Environmental Quality. “The Clean Energy Fund will encourage investment in innovative solutions to both reduce carbon emissions and put North Carolinians back to work.”

Formation of a N.C. Clean Energy Fund was among the top recommendations of the N.C. Clean Energy Plan, as well as two parallel stakeholder processes in 2019 — the N.C. Energy Efficiency Roadmap and the Department of Transportation’s Zero Emission Vehicle Plan. Also known as green banks, clean energy funds incentivize private investment in clean energy projects by addressing and alleviating market barriers, specifically for underserved communities and nascent technologies.

In November, the Nicholas Institute and CGC met with a diverse set of stakeholder groups to discuss perceived financing gaps in clean energy and energy efficiency that a clean energy fund could fill. The conversations cited a range of potential projects throughout the state, including renewable power, building efficiency, and clean transportation.

“A North Carolina Clean Energy Fund provides a unique opportunity to catalyze investment in emerging clean energy markets and fill crucial financing gaps for vulnerable populations,” said Jennifer Weiss, senior policy associate in the Nicholas Institute’s Climate and Energy Program. “By providing technical assistance and credit enhancements, the fund can reduce the risk for private investors.”

There are four key roles a Clean Energy Fund could play in the North Carolina energy market to increase access to clean and efficient energy solutions:

• Connector in the market to provide technical assistance
• Risk mitigator by partnering with commercial lenders to expand access through credit enhancements
• Direct lender in order to expand the market to projects that otherwise could not be financed
• Bundler to aggregate small projects to meet scale to attract private capital

In addition to lowering market barriers, clean energy funds also provide more equitable access to the benefits of clean energy, such as improved health outcomes and reduced financial burdens from energy costs, according to the Nicholas Institute-CGC assessment. That could be achieved by earmarking a portion of the fund’s spending for low-to-moderate income communities or incentivizing or prioritizing those communities for investment.

“The data in this assessment supports what we’ve long-believed: green banks can help alleviate the disproportionate energy burden low-income communities often face,” said Marilynn Marsh-Robinson, manager of partnerships and outreach at Environmental Defense Fund. “By offering low-cost financing options for both renters and homeowners, we can help all North Carolinians get access to affordable capital to make their homes more efficient and lower their power bills. Further, by getting more projects like this off the ground, we help put people back to work, employing those in the communities where services — and jobs — are needed.”

Over the coming months, the Nicholas Institute and CGC will host informational panels on the possible structure of and financing sources for a N.C. Clean Energy Fund. The process will engage a wide range of stakeholders: state and local government agencies, the environmental advocacy community, clean energy organizations, commercial capital providers, community development finance institutions, community groups and private foundations.

Clean energy funds can take a variety of forms depending on the market gaps, policy priorities and budgetary landscape in a particular state or region. The assessment found that a nonprofit organization supported by public policy “seems most likely to yield results supportive of a clean and efficient energy economy” in North Carolina and quickly spur job growth.

Based on the market needs identified by stakeholders and experiences in other states, the assessment recommends at least $100 million in seed capital for a N.C. Clean Energy Fund. In addition to the National Climate Bank, other capital sources could include private foundations, social impact investors, and public money from the state.

“North Carolina already knows first hand that clean energy investment is a huge job creator. A dedicated Clean Energy Fund will deliver those economic benefits to every corner of the state. And the timing couldn’t be better, as the National Climate Bank gets closer to passage, so the North Carolina Clean Energy Fund should get ready to deploy hundreds of millions of those dollars,” said Jeff Schub, executive director of the Coalition for Green Capital.

The market assessment was written by Weiss; Hannah Beinecke, program director of the Coalition for Green Capital; and Jill Bunting, deputy director of the Coalition for Green Capital. The full report, “How a Green Bank Can Drive the North Carolina Clean Energy Economy: A Market Opportunity Overview,” is available at nicholasinstitute.duke.edu/publications/how-green-bank-can-drive-north-carolina-clean-energy-economy-market-opportunity.

The report’s authors will discuss the concept of a North Carolina Clean Energy Fund in more detail during a webinar on Nov. 17, at 1 p.m. More details and registration information are available here.  

Note to broadcast editors: Duke University maintains two television studios with LTN and satellite connectivity, plus two radio studios with ISDN and Comrex connectivity. Both are available for domestic and international interviews, live or taped. These services are usually available during normal business hours and, with enough advance notice, after-hours and on weekends. Broadcast reporters should contact Jeremy Ashton to arrange an interview.

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READ THE REPORT

 

By Jeffrey Schub

Last week, Canadian Prime Minister Justin Trudeau announced a new stimulus plan that invests heavily in climate-related infrastructure to address the on-going economic crisis created by COVID-19. The plan calls for CAN$6 billion of new investment through the nation’s recently-created Canada Infrastructure Bank (CIB). The investment will flow into renewable generation, storage, building retrofits, zero-emission buses, and vehicle charging infrastructure.

This is precisely the strategy and institutional framework the US should implement through the National Climate Bank (NCB). Adjusting for currency and the size of the economy, the equivalent public investment in the U.S. would be approximately $45 billion. And then further adjusted for the fact that this new CIB clean infrastructure investment only covers roughly half of the sectors the NCB is meant to cover, the true equivalent capitalization of the NCB would be approximately $100 billion.

Michael Sabia, Chair of the CIB said, “One of the defining features of the Canada Infrastructure Bank is attracting private investment to new infrastructure. Every dollar of public investment in these initiatives is intended to attract additional dollars from private and institutional investors. In that way, the CIB can have bigger impacts that benefit Canadians and Canada’s economy.”

American policymakers need to look at stimulus in the U.S. through the exact same lens. The U.S. needs genuine stimulus, not only economic relief, to bring back the millions of jobs that have been permanently lost. But that public investment should be strategic and efficient. This means the jobs created should be in industries with a social benefit, and the public funds should catalyze as much private investment as possible.

That is the model proven out by green banks around the U.S. and proposed by the NCB. Third-party analysis found that the NCB can drive up to $500B of total investment in its first five years, and create over 5 million jobs. This is based on the extensive experience of green banks, that have driven roughly 3 dollars of private investment at the project level for each green bank dollar deployed.

Legislation to fund the NCB has now passed the House of Representatives twice in the last few months. It is endorsed and co-sponsored by VP-candidate Kamala Harris. And it is supported by strong margins by voters of all parties.

U.S. emissions per capita are higher than in Canada. And the U.S. economy shrank nearly 3 times more than Canada’s in Q2 2020. If Canada is aggressively moving forward with climate-focused stimulus through a dedicated public-private investment structure, surely the U.S follow their lead.

By Coalition for Green Capital

By Adele Green 

The same thing can happen nationally, where the bank would be created as an independent, nonpartisan nonprofit—sitting outside the government, but capitalized with an initial appropriation from Congress—and could invest both in national projects, such as upgrades to the electric grid, and send money to state and local green banks. “Between 35 and 40 states want to have a green bank or something like it, but they don’t have the capital,” says Schub. That’s especially true as COVID-19 hits government budgets, including in the states and cities that do have green banks now. In Connecticut, nearly half of the green bank’s budget was recently cut to help balance a deficit in the state’s general fund.

Read the full story. 

By Coalition for Green Capital

House provides $20B to create millions of jobs building clean energy infrastructure 

At least 20% of funds required to go to low-income, minority communities

WASHINGTON —The Coalition for Green Capital today called on the U.S. Senate to pass the National Climate Bank Act after the House approved a similar measure for the second time in three months. By a bipartisan vote of 220-185, the House provided $20 billion for a nonprofit accelerator based on the National Climate Bank Act to build clean energy and transportation infrastructure and put millions back to work.  

The nonprofit accelerator would use the proven green bank model to fund projects. With this $20 billion, more than 3 million jobs can be created. With $35 billion, 5.4 million jobs could be created. At least 20 percent of the funds must go to low-income and climate-impacted communities, many of which have also been hard hit by the COVID-19 pandemic. 

“The climate and jobs crises our country faces did not take the summer off. The Senate shouldn’t either. It must act to put people back to work and reduce emissions,” Coalition for Green Capital founder and CEO Reed Hundt said. “We urge Senate leaders to use this tool that a dozen states have shown works to create millions of jobs.”

“Establishing the Clean Energy and Sustainability Accelerator will serve as an important implementation tool to achieve a clean energy economy by publicly financing and stimulating private investments in clean, renewable energy projects, clean transportation, and support communities most effected by climate change,” said Rep. Debbie Dingell, the author of the National Climate Bank Act. “The Accelerator will finance critical infrastructure projects and mobilizes investment directly into the greenhouse gas emissions reduction projects most in need of capital. The expansion of these projects will create good jobs, a strong future workforce, and deliver a clean economy that works for communities in Michigan and across the country.”

The passage of the funding and legislation—based on H.R. 5416 and S. 2057 and introduced by U.S. Rep. Debbie Dingell, U.S. Sen. Ed Markey and U.S. Sen. Chris Van Hollen, respectively—comes after momentum for a National Climate Bank picked up this year. 

In July, Democratic presidential candidate Joe Biden backed the concept and his running mate, Sen. Kamala Harris, also cosponsored the National Climate Bank Act in the Senate. The Senate Democrats’ Special Committee on the Climate Crisis included a National Climate Bank nonprofit in its blueprint following the House’s lead. 

Nearly 100 organizations have sent a letter to U.S. Senate leaders requesting they include $20 billion to start a nonprofit National Climate Bank. 

Authorized projects include renewable power, building efficiency, grid infrastructure like transmission, industrial decarbonization, clean transportation, reforestation and climate-resilient infrastructure. Because the dollars are repaid over time, they can be recycled to make additional investments in the future. 

With 12 million Americans still filing for unemployment due to the COVID-19 pandemic and studies showing that up to 42 percent of those jobs will not return, Congress must urgently make long term investments that create jobs and build a cleaner future. 

National polling shows eight out of 10 Americans want Congress to create clean energy jobs and seven out of 10 support depositing billions to achieve this. 

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