While we weren’t looking, a major new market has developed and could be the next big thing for clean energy in the U.S. — it’s the market for green bonds. Especially exciting are the bonds being promoted by Green America, Clean Energy Victory Bonds.
Another Investment Opportunity for the 75 Percent
Clean Energy Victory Bonds (CEVBs) aren’t available yet. They’re proposed U.S. Treasury bonds that will fund clean energy programs supporting wind, solar, energy efficiency, and electric vehicles.
In addition to financing the production of innovative technologies in the U.S., CEVBs will extend proven programs like the Investment Tax Credit (ITC) for a decade. Now, that’s huge. All over the country, renewable energy advocates have been fretting about what will happen when the ITC runs out at the end of 2016. Extending it would provide a welcome boost to solar and other clean power sources.
What’s more, any American will be able to invest in CEVBs, for as little as $25. That distinguishes them from other green bonds. As Todd Larsen of Green America notes, “Clean Energy Victory Bonds are different in that they will be available to individual investors as well as institutions.” And their low barrier to entry “means that all Americans can afford to purchase one.” In other words, the 75 percent of us who can’t put solar panels on our own roofs will have another way to participate in and benefit from solar and other renewables.
We’ve already seen evidence of pent-up demand for clean energy investment opportunities. CEVBs are expected to have a similar trajectory. Larsen points out that “CEVBs will be Treasury Bonds, the safest investment around. In addition, Americans are very interested in good investments in clean energy. We anticipate that the bonds will all be sold quickly (based on the ongoing demand for Treasury bonds and the clean energy focus).” The bonds are anticipated to raise $50 billion in a short amount of time.
It’s no accident that CEVBs have “Victory” in their name. They’re designed to play a role akin to that of the Victory Bonds of wartime: to “mobilize Americans toward the common goal of a globally competitive U.S. clean technology industry and, ultimately, a greener economy.” And they can green our future with an even better return than other Treasury Bonds.
A $50 billion investment in CEVBs can provide up to $150 billion in public and private financing to fund innovative energy technologies. According to Larsen, “Through tax credits and incentives, the U.S. Government can leverage far greater investment from the private sector. Based on prior experience with the programs to be funded, CEVBs can leverage three times the amount [of capital] the government provides to clean energy from the private sector.”
In World War II, over 80 percent of American households purchased Victory Bonds to support the war effort, raising over $2 trillion in today’s dollars. But those bonds, like others available today, didn’t confer the wide range of benefits that we can expect with CEVBs:
New jobs: The investments in clean energy supported by CEVBs are expected to create at least 1.7 million well-paying jobs in the U.S.
Increased national security: Creating and sustaining our own energy supply instead of depending on foreign sources of energy will enhance our national security.
Energy savings: Clean energy investments should bring savings to consumers, since these energy sources are free from the volatility that characterizes the fossil fuel market. The U.S. economy will also be protected from fossil fuel price increases.
A competitive edge for the U.S.: Investing in clean energy at home can help us “win the renewables race” with China and other countries, and put the U.S. in the lead among countries moving forward in clean energy innovations.
Lower health costs: Cleaner energy means reduced pollution, which would reduce U.S. health care costs by billions of dollars a year.
Proponents of CEVBs call them a win-win-win. They let anyone with $25 make money while supporting clean energy and American jobs — allowing all Americans to invest in the future of their country and benefit from their investments.
And the strategy is one that both Republicans and Democrats can get behind. CEVBs enjoy widespread popularity because they provide financing for clean energy without raising taxes on individuals or corporations.
What You Can Do
In 2012, CEVB legislation was introduced in the House with 15 co-sponsors. This year, it will be reintroduced in the House and introduced in the Senate. Sponsors of the legislation are currently gathering bipartisan support.
Here’s how you can help and get updates:
This article was originally published on Mosaic and was republished with permission.
Lead image: Solar panels via Shutterstock
The information and views expressed in this blog post are solely those of the author and not necessarily those of RenewableEnergyWorld.com or the companies that advertise on this Web site and other publications. This blog was posted directly by the author and was not reviewed for accuracy, spelling or grammar.