At last, one of SEACC’s wonkiest climate priorities has reached the capital!
House Bill 154, and its companion Senate Bill 125, would create an “Alaska Energy Independence Fund” within the Alaska Housing Finance Corporation. In essence, a Green Bank. SEACC has been advocating for a state Green Bank for nearly a year now, and now we need your support for the Green Bank more than ever!
What’s all the Green Bank fuss about?
To put it simply, a Just Transition is expensive. Electric cars are expensive. Electric buses even more expensive. And typically, the people who stand to gain the most from green technology, i.e. poor folks, can’t afford them. Capitalism is not a good system for solving this problem, because capitalism tends to invest money where it’s most profitable to shareholders in the very short term, which is how we got into this mess. Big banks are just not going to help us through the energy transition without major pressure (thank you 350Juneau!), and even then only if it’s profitable for them. Green Banks are designed to fill this gap by creating a special bank specifically for projects that reduce emissions and increase energy equity.
Green Banks do this in a number of ways. Sometimes they loan directly to end users, whether a small business or a single person. For example, a Green Bank might make a loan to a rural utility to complete a hydroelectric project, or it might make loans directly to consumers trying to install residential heat pumps. Green Banks can also use their resources to subsidize other kinds of loans to make them more affordable. For example, a Green Bank could help capitalize an on-bill financing program allowing utility rate-payers to finance energy efficiency technology onto their utility bills!
You might have already heard of the Alaska Housing Finance Corporation (AHFC), which does similar kinds of work to make housing more affordable. It provides direct-to-consumer weatherization programs and subsidizes commercial mortgages for first-time home buyers, for example, so they’re a perfect fit for hosting the Green Bank inside an existing state agency. The Green Bank bill, as it’s written, checks all the boxes for Alaska’s climate movement — it puts the bank inside AHFC, it requires legislative oversight for investments of more than $200,000, and it has strong definitions for what counts as “sustainable energy.”
A quick aside on the RPS.
You may have also heard a couple weeks ago that the Renewable Portfolio Standard (RPS) was introduced in the House and Senate. The RPS sets renewable energy goals for railbelt utilities that share the interconnected grid that stretches from Homer to Fairbanks. While this is mostly a Railbelt issue, I was pleasantly surprised to see some improvements to the Power Cost Equalization (PCE) program, including the ability for railbelt utilities to buy Renewable Energy Credits from PCE communities, and for PCE communities to address issues with waste heat.
For these reasons, I’m actually pretty excited about the RPS bill and its ability to bring economies of scale to Alaska’s just energy transition, and help improve the situation for communities in Southeast that depend on PCE!