The World Bank announced at the Sao Paulo C40 climate conference last month that it would make funds available to cities that need to address climate change risks or reduce carbon footprint. Also in the past month or so we’ve seen the first US stimulus funds used to guarantee loans for portfolio solar installations. I recall that the US government agreed to support Bank of America for a portfolio owned by Prologis and NRG Energy in $1.4 billion of debt facilitates, a total project size of about $2.6 billion, which is being financed entirely by the private sector over the next four years.
These two events are big steps forward in breaking the difficulty of financing for retrofits and alternative energy projects. Financing is the biggest stumbling block for energy and carbon reduction, at the portfolio level and the municipal level. There is efficiency to be gained that will help reduce carbon while being financially viable, but because the payback scenarios are new, banks are reluctant to be pioneers in this area. Obviously the global economic and lending climate is a factor too.
Hopefully these recent developments are signs that the market is coming up with solutions that will work on a large scale. Climate change is a race against the clock; or the calendar anyway and so far it has not appeared that society is winning the race.