The Green Bank: Financing America’s Transition to a Clean Energy Economy
The SEMI PV Group supports the creation of a Green Bank to help finance America’s transition to cleaner and renewable forms of energy, specifically Solar PV. We call on Congress to act this year to create a Green Bank. Such action is a critical part of an integrated strategy to build a strong foundation for broad-based economic growth and prosperity.
What is the Green Bank?
The Green Bank would be a publicly-owned bank, started with federal government seed money, designed to provide low-interest financing to businesses to invest in clean-energy technologies. By working closely with private banks to provide loan guarantees, credit enhancements, and other financing tools, the Green Bank would stimulate private-sector lending and investment for projects that are currently unable to access conventional financing on the size and scale needed.
Funding the Green Bank would require an initial investment of $10 billion, with additional capital of up to $50 billion over five years. After that, it would cover its own operational costs through fees charged for its services.
Why Do We Need the Green Bank?
Most financial experts agree that the one thing the renewable energy industry needs to attract sizable investment is “certainty.” The federal loan guarantees and tax incentives already in place are important, but they are not enough for widespread, fundamental transition. In addition, loan guarantees and tax incentives are subject to extensions and appropriations by Congress, and they have been allowed to lapse in the past. They lack the certainty that medium- to long-term debt financing by the private sector requires.
What is the Status of the Green Bank?
A Green Bank under the name Clean Energy Deployment Administration (CEDA) was the included as part of the Waxman-Markey bill that the House passed in June 2009. In addition, CEDA is part of the Bingaman-Murkowski energy bill passed by the Senate Energy and Natural Resources Committee in June 2009. There has been a movement by the Coalition for Green Capital (www.coalitionforgreencapital.com), of which the PV Group is a member, to include CEDA in Senate “Jobs” legislation. This is a priority public policy issue for the SEMI PV Group, and we will continue to actively push for passage of the Green Bank.
If you have any questions on the Green Bank or other energy policies, please contact Jamie Girard, manager, SEMI Public Policy at firstname.lastname@example.org.
March 10, 2010