By Kazi Stastna, CBC News
You’ve heard of the gold rush? Get ready for the green rush. With close to $370 billion US ($475 billion Cdn) on the table, the race will soon be on south of the border to secure some of the clean-energy cash expected to flow out of the Inflation Reduction Act which Democrats hope to pass this coming week.
“Green banks” are one way that the Biden administration intends to distribute the billions of dollars that are meant to accelerate the adoption of solar, wind, geothermal and other forms of renewable energy.
They are quasi-public entities that aim to attract private investment to small-scale green energy projects, such as residential solar installations, energy-efficient building retrofits and various forms of electrification.
Part of what green banks say they bring to the table is staff with the technical know-how to assess the viability of projects. That was something that attracted the D.C. solar contractor Flywheel Development when it went through D.C. Green Bank to finance a solar roof on a rental building in a low-income neighbourhood in the city’s northwest.
“Their base level of knowledge is just so much higher,” said Flywheel’s co-founder Jessica Pitts. “Lenders that we’ve approached have had much less institutional knowledge in terms of the basics of how do you even fund solar … what are your sources of income and how does it even work?”
The project cost about $132,500, with the green bank kicking in $80,000, the company $26,000 and a city renewable energy program providing the rest. A private lender and the green bank will co-finance the long-term loan that enables Flywheel to oversee the project for the length of the 15-year contract it has with the city and the property owner.
The roof will produce an average of 25,000 kilowatt hours per year, enough to supply six households. In this case, the households it’s supplying are not actually in the building. The electricity generated is fed into the city’s grid and allocated to low- and moderate-income residents through a program called Solar for All that covers half their utility bill.
Flywheel makes its money back by selling the electricity to the city and through solar energy credits, which sell for about $365 to $435 per megawatt hour in D.C., where utilities have to generate 10 per cent of their power from local solar sources by 2041.