The Clean Energy Financing and
Investment Authority: Creating
and Managing a Green Bank
Bryan Garcia, President and CEO, CEFIA
February 6, 2014
Washington, D.C.
Creating and Managing a Green Bank Agenda 202.777.7700
• Foundation for Success and Overview
• Important Decisions We Made Early On
• “Top 3” Biggest Successes
• “Top 3” Biggest Challenges Going Forward
• The Green Bank Model Works
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Washington, D.C.
Foundations for Success
202.777.7700
• POLICY: State energy policy was (and is) an important focus for
the Governor - sweeping energy legislation June 2011
• INDEPENDENCE: Connecticut’s green bank would become its
own quasi-public organization, but with existing staff
• FUNDING: Connecticut’s green bank would take over
existing sources of capital – Clean Energy Fund and RGGI
allowance proceeds
• GOVERNANCE: New Entity & New Board. Board of the
Clean Energy Fund – the predecessor to CEFIA – was disbanded
by act of legislation that created CEFIA on July 1, 2011
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Washington, D.C.
Overview
Visionary Leadership
202.777.7700
…transitioning programs away from
government-funded grants, rebates, and other
subsidies, and towards deploying private capital
…CEFIA was established in 2011 to develop
programs that will leverage private sector capital
to create long-term, sustainable financing for
energy efficiency and clean energy to support
residential, commercial, and industrial sector
implementation of energy efficiency and clean
energy measures.
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Washington, D.C.
Overview
Organization
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• Quasi-public organization – created by PA 11-80 and
successor to the Connecticut Clean Energy Fund
• Focus – finance clean energy (i.e. renewable energy, energy
efficiency, and alternative fuel vehicles and infrastructure)
• Balance Sheet – currently $100 million in assets
• Support – supported by a $0.001/kWh surcharge on electric
ratepayer bills that provides approximately $30 MM a year for
investments, RGGI (EE and RE) about $5-$10 MM a year,
federal competitive solicitations (i.e. SunShot Initiative) and
non-competitive resources (i.e. ARRA-SEP), private capital, etc.
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Washington, D.C.
Overview
Financial Tools
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Grants
Special Capital
Reserve Fund
Equity
Loans
Connecticut Green Bank
Third Party Insurance
Subordinated Debt
Loan Loss
Reserves
Leases, PPAs,
and ESAs
Energy Savings
Performance
Contracts
Bonding
Commercial
Property Assessed
Clean Energy
On-Bill Repayment
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Washington, D.C.
Important Decisions We Made Early On202.777.7700
Decision #1 – Governance
Positions
Committees
Chair
Catherine Smith
B&O
Dan Esty
DECD
DEEP
President &
CEO
Vice Chair
Dan Esty
Deployment
Reed Hundt
Bryan Garcia
DEEP
Coalition Green Capital
Board of
Directors
Administrative
Staff
Professional
Staff
Secretary
Matthew Ranelli
AC&G
Matt Ranelli
(CII)
(CEFIA)
Shipman & Goodwin
Shipman & Goodwin
REFERENCES
Established Board of Directors in September of 2011 – bylaws, operating procedures, employee handbook, etc.
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Washington, D.C.
Important Decisions We Made Early On202.777.7700
Decision #2 – Who Are We (Stakeholder Views)
REFERENCES
Strategic Planning Retreat at the Pocantico Conference Center (November 2011)
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Washington, D.C.
Important Decisions We Made Early On
202.777.7700
Decision #2 – Who Are We (Board of Directors View)
CLEAN
TECH
or
CLEAN
ENERGY
FINANCE
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Washington, D.C.
Important Decisions We Made Early On202.777.7700
Decision #3 – What Programs Do We Keep?
Clean
Tech
Training
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PROGRAMS
Education
Green
Bank
4
PROGRAMS
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Washington, D.C.
Important Decisions We Made Early On202.777.7700
Decision #4 – What Are Our Goals
Support the Governor’s and legislature’s energy strategy to
achieve cleaner, cheaper and more reliable sources of energy
while creating jobs and supporting local economic development
• Attract and deploy capital to finance the clean energy goals for
Connecticut
• Develop and implement strategies that bring down the cost of clean
energy in order to make it more accessible and affordable to consumers
• Reduce reliance on grants, rebates and other subsidies and move
towards innovative low-cost financing of clean energy deployment
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Washington, D.C.
Important Decisions We Made Early On202.777.7700
Decision #4 (cont’d)–…and Metrics of Success?
• Maximize the amount of clean energy produced (or energy saved) per
dollar of public funds at risk
• Amount of clean energy (i.e. energy efficiency, renewable energy, etc.)
produced and deployed. Jobs created and amount of emissions reduced
• Deploy X amount of private capital leveraged by Y amount of public
funds by Year Z. Total dollars of investment in clean energy
• Ratio of private capital to public funds and ratio of ratepayer funds
invested in subsidies (i.e. grants) versus financing programs (i.e. loans)
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Washington, D.C.
Important Decisions We Made Early On
Decision #5 – What Structure Do We Build?
Finance
Residential
Sector
Operations
202.777.7700
President and CEO
C&I
Sector
Institutional
Sector
Infrastructure
Sector
Legal
Marketing
Policy
HR
IT
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Washington, D.C.
Biggest Successes #1
Rebuilt the Organization
Finance
3
President and CEO
4
Marketing
(Future Hire)
5
Residential
Sector
Operations
202.777.7700
C&I
Sector
Institutional
Sector
Infrastructure
Sector
Legal
2
Marketing
1
6
Policy
HR
IT
REFERENCES
Everybody depicted in this slide, was not with the organization before May 31, 2011. Each of
them is here at the Green Bank Academy.
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Washington, D.C.
Biggest Successes #2
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Municipalities Opted into C-PACE
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Ansonia
Avon
Beacon Falls
Berlin
Bloomfield
Branford
Bridgeport
Brookfield
Canaan
Canton
Chester
Clinton
Coventry
Danbury
Durham
East Granby
East Haddam
East Hampton
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East Hartford
East Windsor
Enfield
Fairfield
Farmington
Glastonbury
Granby
Greenwich
Groton
Hartford
Killingworth
Manchester
Mansfield
Meriden
Middletown
Milford
Montville
New Britain
New Haven
New London
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New Milford
Newtown
North Branford
North Canaan
Norwalk
Norwich
Old Saybrook
Plainville
Portland
Putnam
Rocky Hill
Simsbury
Southbury
Southington
Sprague
Stafford
Stamford
Stratford
Suffield
Tolland
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Torrington
Trumbull
Vernon
Waterbury
Waterford
West Hartford
West Haven
Westbrook
Westport
Wethersfield
Wilton
Windham
Windsor
Windsor Locks
Over 80%
of Connecticut is
Open for Business
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Washington, D.C.
Biggest Successes #3
202.777.7700
Residential Solar PV
$/W
Reduced installed cost $/Watt by about 10% year-over-year since 2011
Lowered subsidy by 20% since 2011
CT Solar Lease 2 ($60 MM), CT Solar Loan ($5 MM), and Smart-E Loan ($30 MM)
Installed capacity grew 150% year-over-year since 2011
kW
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Biggest Challenges Going Forward #1
Washington, D.C.
202.777.7700
State Budget Deficits and CEFIA Balance Sheet
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Washington, D.C.
Biggest Challenges Going Forward #2
Collaboration with the Utilities
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▪ Use of Funds – ratepayer funds vs. private capital (credit
enhancement strategy of IRBs versus LLRs)
▪ Additionality – utility model of cost-effectiveness testing (i.e. freerider and spill-over effects)
▪ Goal Congruence – energy savings + private capital to achieve deeper
savings
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Washington, D.C.
Biggest Challenges Going Forward #3
202.777.7700
Financial Innovation AND Marketing Innovation
Increase the
attractiveness to
capital providers
Increase the
attractiveness
to customers
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Washington, D.C.
The Green Bank Model Works
Recap
202.777.7700
•
Green banks support the energy policy
•
Organizational independence is key
•
Focus on clean energy finance
•
Hire the right people
•
Demonstrate (then communicate) impactful
results
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Washington, D.C.
The Green Bank Model Works
Doing More, Faster and Efficiently
$220
MM
INVESTMENT
10:1
LEVERAGE
202.777.7700
1,200↑
30 MW
DEPLOYMENT
JOBS ECONOMY
250,000↓
TCO2
ENVIRONMENT
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Thank You
Bryan Garcia, President and CEO
Clean Energy Finance and Investment Authority
845 Brook Street, Rocky Hill, CT
Bryan.Garcia@ctcleanenergy.com
(860) 257-2170
www.ctcleanenergy.com