Climate Finance: Equitable Solutions to Accelerate Deployment and Inspire Innovation

Jul 20

View The CLEEN Project's Climate Finance Ideas

Top 3 vote-getters:

Contributor: Richard Kauffman

Summary: Proposes that the Treasury should determine that clean energy projects (wind, solar, battery, hydrogen, CO2) are real property. If something is classified as a real property (as opposed to personal property) it is eligible for a REIT (real estate investment trust). Also, Treasury should issue clarification that existing tax benefits for these projects would still be obtained. This would lower the cost of equity for projects, and in so doing, would translate into lower costs for deploying renewable energy. It would also increase public acceptance for renewable energy by allowing many more individuals to make stable, yield investments in clean energy projects.

Taxable Direct Subsidy American Infrastructure Bonds (AIBs) – Revenue Neutral

Contributor: Dawn Weisz

Summary: Proposes passing legislation to allow for the issuance of "American Infrastructure Bonds" (AIBs) and the return of the tax revenue to the tax-exempt entity issuing the bonds – thus rendering them revenue neutral to the US Treasury. AIBs are taxable debt securities that could be sold to investors by any municipal or public agency in the US that can issue tax-exempt debt to finance, among other things, the construction of important and impactful green energy infrastructure projects. AIBs are unique in that the interest earned by investors is taxable income. The income tax that the Federal Government receives from the investors in the bonds is rebated back to the issuing entity in the form of a “direct subsidy” based upon a formula (e.g. 30% of the interest paid) resulting in very attractive (lower) all-in interest costs. AIBs could be issued to finance all types of infrastructure that would otherwise be financed by tax-exempt debt including highways, bridges, water treatment plants, not-for-profit healthcare facilities, etc.

Speeding the Deployment of Deep Energy Retrofits

Contributors: Greg Hale

Summary: Proposes several mechanisms to accelerate deployment of deep energy retrofits in order to lower the cost of deep energy retrofits, unleash demand and scale up the industry—and deliver a number of associated benefits such as lower utility bills, increased discretionary income for residents, improved health, new jobs in the clean energy sector, and reduced emissions. Examples include issuing low/no-interest DOE loans to cover deep energy retrofits of industry plant, equipment, and technology acquisition/start-up costs, and adding measures to reduce tenant health burden and building energy use intensity (EUI) into HUD’s current list of criteria for providing funds to affordable housing agencies.