At CGC we often get asked about the benefits of Green Banks to states. Most people understand the need to increase investment in clean energy infrastructure, but what is it about the Green Bank model that is helpful for this goal? Why implement a Green Bank to address clean energy challenges locally?
- Leverage private capital into rapid expansion of clean energy markets. – Green Banks provide public capital, which is critical to getting clean energy generation, distribution and efficient consumption, as well as clean driven transportation, to occur at scale. Why? Because public capital typically reduces the risk/reward calculation for private capital to a point where private capital is willing to invest in these markets. The result is that public-private investment grows substantially in volume and the private capital provides 80% to 90% of the total investment.
- Create the markets – Green Banks convene developers, private sector investors, and regulators so as to have holistic solutions be deployed at scale.
- Help states use their limited resources more efficiently; taxpayer protection – Green Banks permit states to reduce or refocus rebate programs where possible, and instead to assure that capital is returned over time, with reasonable returns.