White House Mobilizes $4 Billion in Long-Term Renewable Energy Investments

Yesterday, the White House hosted a Clean Energy Investment Summit to mobilize more long term private investments in the industry.

Hundreds of organizations as diverse as the University of California, Goldman Sachs, and Sierra Club Foundation are among the long-term investors that committed $4 billion to back potentially breakthrough solutions for climate change through renewable energy technologies – double President Obama’s goal.

The idea is to bring mission-driven investors together to amplify their impact and help those unfamiliar with the clean energy space. 

This "will help ensure that even more American-made clean energy technologies can make the leap from an idea, to the laboratory, to the global marketplace," says Ernest Moniz, Secretary of Energy. "We’ve seen major advances in solar PV, wind power, advanced batteries, energy efficient lighting, and fuel cells, and we must continue investing," creating entirely new industries in America that reduce carbon pollution while growing the economy.

Green Investing

Piecing the Money Together to Mass Scale Clean Energy

"There’s a whole set of funding sources we’re going to need if we’re going to deploy clean energy at scale. It’s less about the specific amount of money that was committed today, and more about the structures that are being put together. You’re looking at trillions of dollars in capital, but getting folks who run those funds up the learning curve, getting them comfortable with those types of investments, is the challenge," Dan Reicher, Director of Stanford University’s Steyer-Taylor Center for Energy Policy and Finance, told The Guardian 

Indeed, the only way to keep temperature rise below 2C is to  triple spending on clean energy research and development, says the International Energy Agency.

That’s why these new initiatives are so important, the result of executive orders from President Obama: 

  • A Clean Energy Impact Investment Center at the Department of Energy will make information about the federal government’s energy and climate programs more accessible and understandable to the public, including mission-driven investors. They will share research and contacts from DOE’s research labs and developments in technologies, for example, in a modified matching service between investors and technology developers.
  • The Treasury Department will issue guidance on impact investing to facilitate involvement from foundations. It will clarify, for example, that foundations can make certain "mission-related" investments in companies.
  • The US Small Business Administration will offer improved financing options for private investment funds that raise  long-term capital, including early-stage investors in capital-intensive clean energy technologies.

"Long-term investors -such as foundations, family office investors, and institutional investors – can play a catalytic role in accelerating the transition to a low-carbon economy. Philanthropists can help fund clean energy innovation at the earliest stages, where bold new ideas are emerging from our labs, universities, and startups, while investors can scale up the most promising of these innovations. Taken together, these efforts will help ensure that more climate innovations make the leap from the lab into the global marketplace," says the White House.

Another outcome of the summit is a decision form a nonprofit investment intermediary that identifies, screens, and assesses high-potential companies and projects worthy of investment. The consortium is allocating $1.2 billion to start, with a goal of mobilizing $2.5 billion over five years. 

Their focus is on opportunities that don’t fit into existing fund structures, moving companies and projects across the "valleys of death" – the difficult passage from lab to the marketplace. Investors include the University of California and TIAA-CREF.

Last year, Obama reached out to the private sector to scale commitments to use more renewable energy, improve energy efficiency and strengthen building codes.

Read the variety of wide-ranging commitments at the White House summit:

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