Category Archives: Energy Financing

Mad Global Props: The International Energy Agency Hearts ICP

By: Panama Bartholomy, Director of ICP Europe

iea ee reportThe Investor Confidence Project (ICP), was recognized by the International Energy Agency (IEA), a global organization for 29 member countries, in its annual energy efficiency report, released today.

The IEA’s Energy Efficiency Market Report 2014 highlighted ICP as a program that will accelerate the development of a global energy efficiency finance market, saying in its energy efficiency finance chapter that the EDF initiative will “facilitate a global market for financings by institutional investors that look to rely on standardized products.”

For investors, the IEA puts the financial market for energy efficiency in the range of $120bn, with the launch of new products, such as green bonds, corporate green bonds, energy performance contracts, and expanded sources of finance likely to expand that figure. Lending from multilateral development banks and bilateral banks alone amounted to more than $22bn in 2012. Read More »

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While Critics Debate Energiewende, Germany is Gaining a Global Advantage

Source: Frank M. Rafik

Source: Frank M. Rafik

Economics is the focus of many debates surrounding Germany’s aggressive “energy transition” (or Energiewende), which plans to move the country to nearly 100 percent renewable energy by 2050. Critics say Energiewende’s costs are unjustifiable, arguing they hurt the country’s international competitiveness and systemic inefficiencies exacerbate these costs.

At first glance, it’s hard to argue with them. The scale of investment in Energiewende can seem intimidating: So far, Bloomberg New Energy Finance estimates the total cost of Germany’s clean energy expansion at €106 billion. Furthermore, the Wall Street Journal quotes government sources when predicting total costs through 2040 to be about €1 trillion.

By contrast, however, Germany’s annual investment in fossil fuels has been €90 billion; and, investments in Energiewende go into electric grid upgrades that would need to happen in Germany anyway, whereas fossil fuel investments leave the country.

When viewed in context, there are many reasons to believe investments in Energiewende will reap economy-wide rewards, giving Germany a competitive global advantage over other countries that lagged behind investing in the future.

Read More »

Also posted in Clean Energy, Electricity Pricing, Renewable Energy| 3 Responses, comments now closed

Is Global Clean Energy Investment at a Tipping Point?

By: Qiao Feng, Clean Energy Research Intern, and Peter Sopher, Clean Energy Policy Analyst

statistics-76197_640Last week, amidst the U.N. Climate Summit and historic climate march, governments, investors, and financial institutions took the opportunity to make big announcements about their investment in clean energy. Bank of America announced a $10 billion initiative to speed up investment in clean energy, U.N. climate leaders announced a public-private partnership to mobilize more than $200 billion in clean energy financing globally, and New York proposed a $5 billion clean energy fund that could replace the city’s soon-to-expire renewable-energy and efficiency mandates.

So clean energy finance must be skyrocketing upward, right? It’s hard to know now what the 2014 numbers will bear, and we probably won’t see that kind of analysis till 2015, but looking at global investment in renewable power and fuels (excluding large hydro-electric projects) for 2013, these numbers were 14 percent lower than investments in 2012, and 23 percent below the 2011 record, suggesting a downward trend.

However, as conveyed in the Bloomberg New Energy Finance (BNEF) report, Global Trends in Renewable Energy Investment 2014, if the drop in renewable investment were a cloud, it would have several silver linings: Read More »

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California Clean Energy Bill Could Open Door for Homeowners and Small Businesses

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Source: Flickr/constellationenergy

Governor Brown has the opportunity to make energy-saving upgrades possible for families and small business owners by signing Assembly Bill 1883 (Nancy Skinner- Berkeley). This bill would significantly lower the cost of Property Assessed Clean Energy (PACE), a tool which enables property owners to take advantage of energy efficiency and rooftop solar PV for their homes or buildings with no money down, allowing them to pay off the investment over time through their property tax bill.

AB 1883 would streamline the PACE process and drive down the fixed transactional costs associated with commercial projects. Lowering these transaction costs is especially important for small businesses because high transaction costs can reduce the economic viability of the smaller energy upgrades that small business typically need. AB 1883 also incorporates new options for financing rooftop solar PV through PACE, which will enable a greater number of homeowners and small businesses to qualify for cost-saving solar PV contracts. Read More »

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Corporate Buyers Demonstrate Demand for Renewables. Now it’s Time for the Market to Catch Up.

EDF Climate Corps fellow

Colin Krenitsky, 2014 EDF Climate Corps fellow for the Denver Housing Authority.

Last month, twelve major corporations announced a combined goal of buying 8.4 million megawatt hours of renewable energy each year, and called for market changes to make these large-scale purchases possible. Their commitment shows that demand for renewables has reached the big time.

We’re proud that eight of the twelve are EDF Climate Corps host organizations: Bloomberg, Facebook, General Motors, Hewlett Packard, Proctor & Gamble, REI, Sprint and Walmart. The coalition, brought together by the World Wildlife Fund and World Resources Institute, is demanding enough renewable energy to power 800,000 homes a year. And while it's great to see these big names in the headlines, they're not alone in calling for clean energy: 60 percent of the largest U.S. businesses have set public goals to increase their use of renewables, cut carbon pollution or both. Read More »

Also posted in Clean Energy, Climate, EDF Climate Corps, General, Renewable Energy, Utility Business Models| Comments closed

Moving On, but Continuing the Work

Source: Chuck Abbe

Source: Chuck Abbe

Four years ago, I joined Environmental Defense Fund to work on climate policy as I believe that the issue is one of the most critical challenges of our era. I felt that my background working on Wall Street could be put to good use in crafting finance policies that help fight climate change. I chose EDF because they are the environmental organization that best understands how to use market mechanisms to deliver environmental solutions.

Tomorrow will be my last day at EDF, but I am not leaving because of any disappointment with the organization or any decline in my commitment on climate issues. At this point in time, new market mechanisms to finance clean energy are in place. The biggest contribution I can make is to switch to the private sector and demonstrate how well these mechanisms can deliver job-creating private investment.

Over the past several years, On-Bill Repayment (“OBR”) and Property Assessed Clean Energy (“PACE”) programs have been developed that are expected to allow for significantly increased investment in energy efficiency and solar generation projects.  State of the art PACE programs are up and running in California for commercial and residential properties, and in Connecticut and Ohio for commercial properties. Texas and New Jersey are expected to also launch programs in coming months. Later this year, Hawaii is expected to start the country’s first open-source OBR program that EDF helped design. Read More »

Also posted in California, Clean Energy, Climate, Investor Confidence Project, On-bill repayment, Renewable Energy, Utility Business Models| Tagged , | 1 Response, comments now closed

Can New York Beat California in the Clean Energy Race?

Source: Martineric/Flickr

Source: Martineric/Flickr

This post was adapted from an op-ed piece published in Morning Consult.

New York doesn’t have California’s sunshine or Texas’ wind. But it has a vision and willpower that is quickly turning the Empire State into a leader for clean energy solutions.

In the year and a half since the devastating impact of Hurricane Sandy, New York Gov. Cuomo has appointed strong leadership and devoted large-scale investment to develop a resilient energy infrastructure that can withstand the extreme weather events brought on by climate change.

And the state is now digging into a major evaluation of how energy is produced, distributed, and priced – while ramping up funding for renewable energy. Read More »

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The 2014 U.S. Clean Tech Leadership Index: Did your State, City Make the Cut?

cleantech indexjpgIf there is one thing that works in the world of advocacy, it is a ratings table that shows how one state, metropolitan area, or utility compares to its peers. The latest report, U.S. Clean Tech Leadership Index, from Clean Edge does just that.

The fifth annual U.S. Clean Tech Leadership Index finds that California, Massachusetts, Oregon, Colorado, and New York lead the way among states in solar and electric vehicle adoption, with smart climate policies and clean energy financing driving the clean tech leadership index growth.

Clean energy is becoming a popular choice for mainstream America with 11 states now generating more than ten percent of their electricity from non-hydro renewable sources, according to the Clean Edge report. As seen in the graph below, Iowa leads the way in utility-scale wind, solar, and geothermal electricity generation. Read More »

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What Two Recent Transactions Say about the Future of Clean Energy Finance

PACE financing allows home owners to install solar panels and repay their loans through their property tax bill. Photo source: Michael Coghlan Flickr.

PACE financing allows home owners to install solar panels and repay the loans through their property tax bill. Photo source: Michael Coghlan Flickr.

Last week saw the completion of two exciting finance transactions that will increase investment in and reduce costs for clean energy projects.

In the first transaction, Renovate America, announced that it raised $50 million in venture capital funds to expand operations. The San Diego-based company develops residential Property Assessed Clean Energy (PACE) programs, which allow home owners to repay loans for energy efficiency and/or renewable generation through their property tax bill. Renovate America runs the successful HERO program, which in its first two years of operation provided $130 million in financing to homeowners in western Riverside County to retrofit their homes and reduce electricity bills.

So far this year, Renovate America has invested an additional $120 million to fund retrofits across California. EDF hopes the recently announced $50 million capital injection will not only allow Renovate America to continue its California expansion, but to expand to other states in the near future as well. We plan to work closely with Renovate America and their primary competitor Renewable Funding, which closed its venture round in April by raising $20 million. EDF’s collaboration with both companies will help additional states create residential PACE programs, attract investment for homeowners, and create jobs. Read More »

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Financial Sector Focuses on Risks from Methane

By: Sean Wright, Senior Analyst, Corporate Partnerships

Source: Ash Waechter

Source: Ash Waechter

Environmental concerns about methane emissions continue to grow as more people understand the negative climate implications of this incredibly potent greenhouse gas. Now the financial community is taking note of not only the environmental risks but the impact of methane emissions on the oil and gas industry’s bottom line. Methane leaks not only pollute the atmosphere, but every thousand cubic feet lost represents actual dollars being leaked into thin air—bad business any way you look at it.

Last week the Sustainability Accounting Standards Board (SASB)—a collaborative effort aimed at improving corporate performance on environmental, social and government issues—released their provisional accounting standards for the non-renewable resources sector, which includes oil and gas production.

These accounting standards guide companies on how to measure and disclose environmental, social, and governance (ESG) risks that impact a company’s financial performance. Their work highlights the growing demand amongst investors and stakeholders for companies to report information beyond mere financial metrics in order to provide a more holistic view of a company’s position.

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