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First national green bank launches with IRA funding
Aug
Dive Brief:
- The first U.S.-based national green bank has opened, run by the nonprofit Coalition for Green Capital with over $5 billion in funding from the Inflation Reduction Act, the group announced Thursday.
- CGC, which also operates as the American Green Bank Consortium, said it will use the IRA’s funding for direct and indirect clean energy investments utilizing a network of state and local green banks, per the release.
- The Environmental Protection Agency first chose CGC to help establish a national green bank in April, awarding the group $5 billion from the National Clean Investment Fund as part of a $20 billion Greenhouse Gas Reduction Fund award. The Greenhouse Gas Reduction fund was part of the 2022 Inflation Reduction Act, which included $369 billion in clean energy benefits.
Dive Insight:
CGC said the EPA funding will allow the organization to invest directly in qualified clean energy projects and help create a “self-sustaining nationwide network of state and local green banks, community lenders and community partners. As the American Green Bank Consortium — a membership organization for green banks — CGC reported its members investing $10.6 billion in 2023, including $5.2 billion in public investments and $5.4 billion in private capital, according to a report also released Thursday.
CGC CEO and co-founder Reed Hundt, a former Federal Communications Commission chair and former chair of CGC, said Thursday’s announcement triggered a process that releases the EPA funding to allow the bank to build its staff, make investments and begin to create a network of green investors in every state.
“At long last, our vision is officially a reality. The country’s first national green bank is open for business,” Hundt said in Thursday’s release. “It’s time for public-private investment to join up with tax credits and U.S. Department of Energy loans as the three ways this administration will win the battle against catastrophic climate change and fight for social justice in every American community.”
The bank expects to use the EPA award to effectuate $21.1 billion in cumulative public-private clean power project investments in the first year, per the release. Hundt said the bank already has hired 23 employees — a number expected to double by the end of the calendar year — and over $10 billion in projects in its pipeline.
Bryan Garcia, who chairs the CGC board and is president and CEO of Connecticut Green Bank, thanked the EPA for the “methodical, comprehensive and extensive process” that led to the first U.S. national green bank.
“There is no time to waste in working with our green bank network to mobilize private investment across this country, especially in underinvested communities, in projects that reduce greenhouse gas emissions and air pollution and create meaningful benefits – reducing energy costs for families, creating jobs in our communities, improving public health, and growing the green economy,” Garcia said in Thursday’s release.
CGC also announced the national green bank’s initial team on Thursday, including multiple green economy and renewable energy veterans. In addition to Hundt and Garcia, the team will consist of, per the release:
- Chief Network Officer Stephen Brown, the founder and CEO of Texas green bank the Clean Energy Fund of Texas;
- Chief Impact Officer Jessica Buendia, previously vice president of sustainability at national nonprofit Dream.Org;
- Chief Operating and Compliance Officer Jeff Diehl, a 40-year financial institution veteran who previously was CEO of Rhode Island Infrastructure Bank;
- Chief Capital Officer and Head of Investments Alfred Griffin, former president of New York Green Bank;
- Chief Investment Officer Michael Hoffman, former senior managing director at the Blackstone Group and co-head of Riverstone’s renewable energy funds;
- Chief Administration and Development Officer Eli Hopson, most recently the inaugural CEO of the DC Green Bank;
- CFO Sanjeev Kumar, a 25-year renewable industry veteran with two successful initial public offerings on his resume;
- Chief of Staff Daniela Nyiri; an electoral and advocacy campaign veteran, who built the greenbankmovement.org database; and
- General Counsel and Chief Strategy Officer David Pettit, a former assistant general counsel at Xcel Energy.
The bank’s application helped build a coalition of 18 sub-recipients, including 16 state and local green banks and two national nonprofits. The national green bank will also help finance and support a network of 191 other participating partners “to develop a national pipeline that can equitably drive the adoption of clean energy,” per its website.
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