How Green Banks Can Boost Renewable Energy Investments »Yale Climate Connections
When a new clean energy project is difficult to finance, a green bank sometimes steps in to help. Using public capital, these institutions can provide loans and encourage private investment.
Alex Kragie is Director of the American Green Bank Consortium.
âOur business is not in direct competition with private capital,â he says. âFor example, we are not interested in financing a solar farm under construction in the Nevada desert. There is a lot of interesting financing for these types of projects. What we are focusing on are projects that cause some hesitation from private sector lenders. So maybe installing solar panels in the Nevada desert has an element of energy storage that makes lenders a little nervous. Green banks can step in and jump into the capital pile and get to a point where lenders are comfortable with the project, turning the project from a red light to a green light.
The efforts of members of the American Green Bank Consortium have collectively led to more than $ 5 billion in new investments in clean energy. But Kragie says a lot more is needed.
âIt looks good, and we’re proud of it,â he says. “But we have to add a few zeros at the end of this – quickly – if we’re going to do anything to really tackle the problem of climate change.”
Report credit: ChavoBart Digital Media.