Energy Exchange

A global game changer for energy efficiency investments

By Victor A. Rojas / Published: March 12, 2018

Three hospitals in England recently cut energy costs in half after spending the equivalent of $18 million in energy efficiency upgrades. The projects got a much-needed boost from a certification that gave investors confidence the retrofits would bring returns.

With millions of buildings in need of upgrades and the emergence of a $20-billion retrofit industry in the United States alone, there is neither a shortage of projects nor capital looking for environmental opportunities in which to invest. What has been lacking is a way to grow the market to scale.

Even with an energy efficiency market topping $1 trillion, investors have historically considered such retrofits risky. All this is changing quickly with a new and global underwriting standard mitigating the risk of such investments. Read More »

Posted in Clean Energy, Energy Efficiency, Energy Financing, Investor Confidence Project / Comments are closed

Investor Confidence Project Gains Momentum in 2014, Poised for Even More Success in 2015

By Victor A. Rojas / Published: January 5, 2015

The Investor Confidence Project (ICP), an EDF initiative designed to unlock investment in energy efficiency, experienced significant momentum in 2014. By gaining support in key states across the country as well as expanding to Europe, ICP laid the groundwork for even more successes in 2015.

Through ICP, EDF is accelerating the development of a global energy efficiency market by standardizing how energy efficiency projects are developed and energy savings are calculated.

In virtually all established markets, from car loans to home mortgages, standardization in how projects are structured and documented has helped to accelerate underwriting and create a vibrant secondary market, reducing long-term liability and spurring investment. The potential energy efficiency market is estimated at $1 trillion, but in order to realize a fraction of this market, the energy efficiency industry will need to leverage standardization to scale to this level. Read More »

Posted in Clean Energy, Energy Efficiency, Energy Financing, Investor Confidence Project / Comments are closed

EDF Co-Hosts International Green Bank Summit on Catalyzing Private Sector Capital for Clean Energy

By Victor A. Rojas / Published: November 20, 2014

In order to fund the transition to a low-carbon economy at a pace rapid enough to prevent runaway climate change, the International Energy Authority has estimated that an annual $1 trillion will be required globally. What policies or mechanisms can be used to facilitate private capital engagement on so grand a scale?: Green banks, which are government-created financial institutions that use attractive interest rates and other incentives to leverage money from the private sector to fund clean energy projects.

Earlier this week, EDF co-hosted the first day of the two-day, second annual International Green Bank Summit in our New York City headquarters, bringing together green bank stakeholders from around the world. The summit focused on how green banks can better leverage limited amounts of public capital to engage and accelerate the deployment of private capital into essential energy efficiency, renewable energy, and climate change mitigation initiatives.

Green banks are catalysts

With one dollar of public finance leveraging about three dollars of private capital, global green banks have catalyzed nearly $20 billion dollars to date in clean energy projects around the world and expect to raise more than $40 billion over the next five years. So far, only a handful of countries have developed green banks. Read More »

Posted in Clean Energy, Energy Efficiency, Energy Financing, New York, Renewable Energy / Tagged Green banks | Read 1 Response

Growth in Green Bond Market Underscores Need for Market Standards

By Victor A. Rojas / Published: June 26, 2014

The significant growth that we have seen in the past year in green/climate bond issuances – $11.4 billion in 2013 and an estimated $40 billion in 2014 – strongly suggests a threshold market acknowledgement of the enormous potential in these instruments. Growth in the market and a rapid increase in the volume of climate/green bonds strongly suggest that we are approaching a broad yet fundamental market acceptance of this new asset class. If so, it is important that we begin to shift gears and move from proving the model to creating the market infrastructure that incorporates meaningful standards to support a wider and more liquid market for climate/green bonds.

Green bonds and climate bonds are issued to pay for environmental projects. These are often issued by large institutions, such as World Bank, Bank of America, and Toyota that invest in both environmental and non-environmental projects. However, the proceeds from these bonds are invested exclusively in environmental projects. Many, but not all green bonds are climate-focused. Climate bonds, however, are totally linked to assets that encourage a rapid transition to a low-carbon and climate resilient economy. Read More »

Posted in Clean Energy, Energy Financing / Tagged green bonds | Read 2 Responses

Transitioning to a Clean Energy Future Will Require Lots of Private Capital, but How Do We Get There?

By Victor A. Rojas / Published: March 25, 2014

Source: 401(K) FlicThe past two decades have seen a tremendous growth in our understanding of the climate change imperative and in the enormity of the challenge that confronts us. It has become clear that meeting climate change mitigation objectives will require the aggressive deployment of clean energy technologies, substantial amounts of capital, and creative methods of engaging that capital around these activities.

Transitioning to a low-carbon economy costs money (and lots of it). In fact, the International Energy Agency has estimated that $10.5 trillion will be required between 2010 and 2030 to fund this transition worldwide. Given the continuing challenges confronting global economies, the bulk of the capital needed to transition to this clean energy future will, by necessity, be private capital. As a result, creative financing solutions are essential to engaging and unleashing private, institutional capital, and accelerating the flow of those funds toward clean energy projects.

But the question of how to most effectively unlock the enormous amounts of capital necessary to pay for our transition to a low-carbon economy still remains. Read More »

Posted in Clean Energy, Climate, Energy Efficiency, Energy Financing, Investor Confidence Project, On-bill repayment, Renewable Energy / Tagged green bonds | Read 1 Response

$200 Million in Private Capital Financing Signals Investors’ Support for Clean Energy

By Victor A. Rojas / Published: January 29, 2014

(Source: www.poonamsagar.com)

While 2014 is only just getting underway, it is already shaping up to be a banner year for clean energy finance. Capital investments are being made, funds developed, and securitization tools crafted — all with remarkable speed. And private capital markets are aggressively rallying around these efforts, which will only increase the momentum of our collective efforts to drive investments into essential energy efficiency and renewable energy projects.

Funding for homeowner energy efficiency loans could lead to securitization

Early this year, clean energy consumer finance company, Kilowatt Financial, closed a $100 million deal with Citi to finance 10-12 year unsecured loans of up to $30,000 for homeowners making energy efficiency improvements to their HVAC (heating, ventilation, and air conditioning) systems, water heaters, windows, roofing, insulation, lighting, and appliances.

The transaction is designed to facilitate a securitization of loans (which promotes liquidity in the marketplace), help establish a secondary market, and spur energy efficiency investments. Kilowatt and Citi expect to create term asset-backed securities from the loans that will provide a sustainable source of capital for homeowners looking to make home energy upgrades. Read More »

Posted in Energy Efficiency, General, Investor Confidence Project, On-bill repayment, Renewable Energy / Tagged Clean Energy, Clean Energy Financing | Comments are closed