Senators Markey and Van Hollen Introduce Legislation to Create a National Climate Bank
Will leverage $35 billion in public funds to fund as much as $700 billion in total investment into projects that support clean energy, reduce emissions
Washington (July 8, 2019) – Senators Edward J. Markey (D-Mass.) and Chris Van Hollen (D-Md.), members of the Environment and Public Works Committee, today introduced the National Climate Bank Act, legislation that would create a federal bank to leverage public and private funds to invest in clean energy technologies and infrastructure. The National Climate Bank would provide financing to eligible regional, state and local green banks, make investments directly into projects that reduce carbon emission, and provide technical assistance for the start up of new green banks around the United States. The legislation is also co-sponsored by Senator Brian Schatz (D-Hawaii) and Senator Richard Blumenthal (D-Conn.).
Across the nation – in Connecticut, New York, and Michigan, public money has been used to leverage six to twenty times more dollars in private investment. On a national scale, investing just $35 billion of public funds into a national climate bank could generate between $213 and $700 billion in total investment into clean energy related projects. An investment of that size in new installed renewable energy could mean more than 70 percent of U.S. homes powered by clean electricity, all with an investment less than one percent the size of the current federal budget.
The National Climate Bank would be capitalized with $10 billion initially, with an additional $5 billion every year for five years.
“When we invest in clean energy projects at home, we can export American technology and expertise overseas instead of importing foreign oil,”said Senator Markey. “A national climate bank is a model for how the financial, government, and private sectors can work together to leverage investment in climate action. We must continue to find innovative ways to capture and accelerate the momentum of the green economy, and a National Climate Bank will help invest in projects that are looking to decrease energy use and decrease carbon emissions.”
“We stand at a precipice when it comes to addressing the threat of climate change. A central part of any plan to deal with the crisis must include a major federal investment in clean technologies. A smart way to do this is to create a National Climate Bank, which will give a jump start to the great work already happening at the state and local levels and within the private sector,” said Senator Van Hollen. “This builds upon and adds to the Green Bank Act, which I was proud to lead in the House of Representatives and will continue to fight for in the Senate. As this Administration continues to deny the harmful effects of climate change, the creation of a National Climate Bank is one way we can move forward on building a 21st century clean energy economy — with good-paying American jobs and a more sustainable future.”
Specifically, the National Climate Bank would make the United States a world leader in combating the climate crisis by catalyzing and mobilizing private capital, increasing clean energy accessibility and environmental justice, supporting the creation of new green banks, and exploring ways to support the retirement of emissions-intensive generation. The National Climate Bank will seek investment and procurements in areas such as renewables, storage, transportation, transmission, resiliency, efficiency, reforestation, agriculture, and industrial de-carbonization. The Bank would explore new and innovative investment approaches to reduce emissions, including a “Cash for Carbon” program in the utility sector, where globally 42 percent of coal power plants are unprofitable but still operating.
“Senator Markey has raised the bar in the policy battle against climate change,” said Reed Hundt, CEO of the Coalition for Green Capital.“The National Climate Bank maximizes emissions reductions per public dollar deployed, and is committed to social and environmental justice. And as a nonprofit outside of government, it will have the structure necessary to succeed on these objectives. A Climate Bank like this one is a critical part of the toolkit for implementing the Green New Deal.”
“Green Banks have already proven their worth,” said Bryan Garcia, President and CEO of the Connecticut Green Bank. “In Connecticut we’ve brought solar to tens of thousands of households, with 20% of those being low-income households. Clean energy should be available to all, and the unique investment approach means that the projects make financial sense over the long term.”
“Currently, climate finance architecture is complicated, inefficient, and not designed to mobilize and deliver trillions in blended public-private financing needed to rapidly scale low-carbon infrastructure,” said Angela Whitney, Manager for Global Climate Finance at the Rocky Mountain Institute. “A Green Investment Bank is specifically designed to lower risk and attract private investment to support domestic low-carbon infrastructure.”
“America has abundant untapped clean energy resources — it’s time to invest and take them to scale,” said Victor Rojas, Senior Manager of Clean Energy Finance at the Environmental Defense Fund. “A national green bank can help generate jobs, investment and healthier air and water in communities across the country.”
“Smart, new financing policy solutions are key to helping us rapidly accelerate the adoption of energy efficiency – the fastest, cheapest, easiest and most abundant way to tackle climate change,” said Jason Hartke, President of the Alliance to Save Energy. “This bill certainly recognizes the value of energy efficiency and aims to unlock public and private investment in energy efficiency, which will deliver savings to families and businesses, create jobs and combat climate change.”
“Our country is going to need massive investments to cut carbon pollution, boost clean-energy jobs and prepare for the impacts of our looming climate crisis,” said Doug Sims, Senior Advisor, Green Finance at the Natural Resources Defense Council. “By investing across all sectors of our economy, a National Climate Bank will reduce carbon emissions and make all communities, especially communities of color, more resilient and adaptive and help build the green economy we need.”