Connecticut Green Bank Green Bank 2.0 – Green Bonds US Maine Green Bank Summit June 25, 2020
Connecticut Green Bank Mission Statement and Goals Confront climate change and provide all of society a healthier and more prosperous future by increasing and accelerating the flow of private capital into markets that energize the green economy . Leverage limited public resources to scale-up and mobilize private § capital investment in the green economy of Connecticut. Strengthen Connecticut’s communities by making the benefits of the § green economy inclusive and accessible to all individuals, families, and businesses. Pursue investment strategies that advance market transformation in § green investing while supporting the organization’s pursuit of financial sustainability. 2 2
Connecticut Green Bank Reduce Costs – Increase Customer Demand BEFORE AFTER Net Savings § Cheaper Clean Energy § Cleaner Project Energy Bill § Reliable Financing Payment § Healthier Energy Bill Clean Energy Energy Improvement (Behind the Meter) REFERENCE Definition provided by the Coalition for Green Capital and adapted by the Connecticut Green Bank 3 3
Connecticut Green Bank Reduce Risk – Increase Supply of Private Capital Capitalization of Green Bank 1 Clean Energy Fund/RGGI Innovative financing structures 2 Private investment flows Creation & Public 3 1 Capitalization Risk Mitigation Connecticut Private Green Bank Investors 2 3 Private Public Investment Investment Financial Financial ($6.00) ($1.00) Return Return Clean Energy Projects (Families, Businesses Social & & Government) Environmental Return 4
Connecticut Green Bank Impact Investment – Social and Environmental ENVIRONMENTAL ECONOMIC INVESTMENT PROTECTION DEVELOPMENT 23,004 direct, indirect, and 8.7 induced job-years 131 million 1.7 million $283 MM $1.8 B TAX REVENUES ENERGY BURDEN REDUCED PUBLIC HEALTH SAVINGS $46.9MM $24.2 MM $22.7 MM $229 to $517 42,000+ 375+ REFERENCES 5 Connecticut Green Bank Data Warehouse – July 1, 2011 through June 23, 2020
C-PACE Commercial, Industrial, Non-Profit, and Multifamily Market Commercial, Industrial, Segment Nonprofit and Multifamily (Warehousing) Product Commercial Property Assessed Summary Clean Energy (C-PACE) applies a benefit assessment to a property to finance clean energy improvements with SIR>1 Support • Capital to finance clean Needed energy improvements • Contractors to install clean energy improvements • Supportive municipality • Supportive mortgage lender CT Results of 328 projects, 24% industrial, C-PACE $194.1 MM investment, 42.0 MW of RE, 29% projects have EE REFERENCES 6 Data from Power BI through 6/6/20 6
Solar for All Solar PV Lease and Energy Efficiency for LMI Market Segment Residential Single Family LMI Solar PV and Energy Efficiency Product Solar lease + energy efficiency Summary package (fixed 20 years) to reduce energy burden with alternative underwrite/no credit score using community based marketing approach Support Needed § Local EE Contractors § Municipal, community and nonprofit introductions § Investors – senior lenders and equity investors § Subordinated debt capital, including tiered LMI incentive CT Results 3031 leases for $83.9 MM investment, 20.0 MW, 100% get HES, 66%+ EE, and reached 75% LMI REFERENCES 7 7 Data from Power BI through 6/22/20
Food Waste to Energy AD and CHP Market Project Finance Segment Project Provided long-term subordinated debt (i.e., 15 years) at low interest Summary rate (i.e., 2%) for 20% of the capital structure to finance the 1 st AD project of its kind in CT § Production process produces a Why AD for lot of farm waste (estimate of Sanofi Pasteur 10,000-12,000 tons per year each for hen and egg waste) § Increase size of Southington facility – located 17 miles from Meriden CT Results of $10 MM project, 1 MW, diverts organic materials from waste stream AD Project while producing renewable energy and waste heat 8 8
Connecticut Green Bank Vision Statement – Green Bonds US …a world empowered by the renewable energy of community REFERENCES Vision Statement inspired by the Innovations in American Government Awards at the Ash Center of Harvard University’s Kennedy School of Government, Maya Angelou’s “On the Pulse of Morning,” and the powerful words of Mary Evelyn Tucker on “inclusive capitalism”. 9 9
Increase Investment Green Bank 2.0 – Green Bonds US = $1 in public investment in clean energy per person per year = $1 in private investment in clean energy per person per year x 10 Connecticut Connecticut EE and RE in US by CAP Clean Energy Fund Green Bank 1.0 or Sustainability by UN $9/person/year $90/person/year $600-$800 REFERENCES 1. CT Population = 3,600,000. US Population = 321,400,000. World Population = 7,500,000,000. 2. CCEF Annual Investment = $32 MM (1:1). CGB Average Annual 2-Year Investment = $320 MM (6:1). Center for American Progress = $200 B a year for 20 years. UN Report = $6 T assuming $90 T over 15-years (i.e., since 2016). 10
Green Bonds Green Bonds Can Solve Our Climate Crisis Green Bonds Can Solve Our Climate Crisis By Miriam Tuerk August 28, 2019 Those of us involved in the clean tech industry are well aware that financing is a key component of growing clean tech adoption. Despite a rise in Environmental, Social and Governance (ESG) investing, the financial services industry still has a lot of work to do to assist in the global effort against climate change. As with all things, this brings both social responsibility and business opportunity. … Here are some examples of companies leading the charge: Connecticut Green Bank While not a utility, the Connecticut Green Bank completed an issuance of $38mm for Connecticut’s Residential Solar Investment Program (RSIP) in May. RSIP provides homeowners with a rebate of $0.46 cents per watt of solar installed in order to help offset the costs of installing residential solar power. 11
Green Liberty Bonds Celebrating the 50 th Anniversary of Earth Day 12
Green Liberty Bond Definition – Specific Class of Green Bond Use of Proceeds – use of proceeds § from the bond are invested to combat climate change (i.e., support Paris Agreement with mitigation and adaptation projects) and create jobs in our communities Retail Accessible – bonds available § to purchase by everyday citizens (vs. institutional investors only) in small denominations (i.e., ≤$1,000) Certified and Verified – § independently certified (e.g., Climate Bonds Initiative, Green Bond Principles, etc.) and verified as a climate bond or green bond for consumer protection 13
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Thank You Connecticut Green Bank 845 Brook Street, Rocky Hill 300 Main Street, 4 th Floor, Stamford (860) 563-0015 www.ctgreenbank.com www.greenbondsus.com www.greenlibertybonds.com
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