UPDATE: The bill to establish the DC Green Bank was signed by Mayor Bowser on July 2, 2018. Officially known as the District of Columbia Green Finance Authority Establishment Act of 2017, the bill is currently under 30-day congressional review. Read the Council’s website for more information on the review and projected law date.
In the spring of 2017, as part of an initiative to research innovative tools for financing clean energy projects in the District, the Coalition for Green Capital recommended the creation of a “green bank” as a key mechanism to accelerate the deployment of affordable private and public capital for clean energy projects.
Green Banks are institutions that states and countries are using to finance projects that will create green jobs, expand solar power, lower energy costs, reduce greenhouse gas emissions, and meet sustainability goals. Green banks are capitalized with limited public funds and attract private capital investment, which are then used to offer loans, leases, credit enhancements, and other financing services to close funding gaps for clean energy projects.
The goal of a green bank is to accelerate the deployment of clean energy technology by leveraging private investment, removing upfront costs, and increasing the efficiency of public dollars. Other green banks in the United States — including those in Connecticut, New York, Rhode Island — have shown impressive success in using smaller amounts of public capital to leverage billions of dollars of private sector funding.
Specifically, the Coalition for Green Capital report suggests that a DC green bank could:
- Attract private capital at a ratio of 5 private dollars to every 1 dollar of public investment;
- Use bonding authority to increase capacity, accelerate lending, and recapitalize funds;
- Accept funding from foundations, such as the recent $3M Kresge Foundation award to the Connecticut Green Bank; and
- Be a breakeven entity, where the revenues earned from financing activity cover its operating costs.
Please see the links below to access a Green Bank 101 primer and the full report and presentation from the Coalition for Green Capital. Read about Mayor Bowser’s recent announcement about her plan to make the District of Columbia the first city in the nation to establish a Green Bank.
For more information, please contact Jay Wilson, program analyst.