NEW YORK — NRDC Release – The new Inflation Reduction Act is poised to make major investments across the country and in disadvantaged communities to more equitably spur development of green technologies that reduce or avoid climate pollution, according to participants at a Climate Week green bank event today in New York City, featuring keynote addresses from Rep. Debbie Dingell of Michigan and Sen. Edward Markey of Massachusetts, sponsors of legislation creating a national climate bank.
“The new climate bill can be a real game changer for the U.S. on investing in clean energy, climate action and equity, if implemented the right way,” said Sarah Dougherty, director of the Green Finance Center at NRDC (Natural Resources Defense Council.) “Green Banks have a proven track record globally stimulating new private investment and starting new, self-sustaining markets for deploying climate solutions, including in low-income and marginalized communities. And they can play a key role in the U.S. addressing the climate crisis and building resilient communities.”
The new law contains $27 billion for a Greenhouse Gas Reduction Fund that can be used by cities, states, or Tribal Governments, new or existing green banks, as well as other long-standing institutions like Community Development Financial Institutions and credit unions, to cut climate pollution, clean up the air and drive clean energy, with more than half of the funding explicitly directed to low-income and disadvantaged communities.
Green banks include stand-alone institutions and existing public development banks that are transformed with strong climate mandates and additional climate finance capacities. They can play a key role in advancing country priorities on climate and sustainable development goals.
The Greenhouse Gas Reduction Fund demonstrates the U.S. is serious about investing in clean energy, efficient buildings, and resilient infrastructure in disadvantaged communities, so businesses, families and individuals will benefit from cleaner air, better housing and infrastructure.
Around the world, green banks are a proven model. By sharing investment risks, building local capacity, and transforming markets, green banks help cities, states, and countries scale up climate action, ambition, and move closer to achieving climate targets under the international Paris Agreement on climate change.
Through mid-2021, Green Bank Network members globally invested $54.4 billion to support renewable energy, energy efficiency and other projects valued at $134.7 billion. Together, these green bank-supported projects are estimated to have avoided 48.03 million metric tons of carbon pollution, equivalent to taking 22.4 million cars off the road.
“We have an incredible opportunity to demonstrate the transformational impact that green finance can deliver through a partnership between a national green bank, state and local green banks, and community financial institutions, said Eli Hopson, CEO, DC Green Bank. “In our communities right here in DC, we are already seeing the benefits of green jobs, clean energy, and equitable development. This new economic paradigm will create a powerful enabling environment to ensure that the future is clean and green and that no communities are left behind.”