Clinton to the rescue

peter_j

C40 Cities and The Clinton Climate Initiative have identified Melbourne as one of 15 cities to trial a "Green Loan". Bank-rolled by some very large banks, the scheme is intended to stimulate the retro-fitting of existing commercial buildings into something more sustainable.

THE AGE 18.05.07

ABN AMRO, Citi, Deutsche Bank, JPMorgan Chase, and UBS have committed to arrange $1 billion each to finance cities and private building owners to undertake these retrofits at no net cost, doubling the global market for energy retrofit in buildings.

These banks will work alongside energy efficiency finance specialist Hannon Armstrong and CCI to develop effective mechanisms to deploy this capital globally. Cities and building owners will pay back the loans plus interest with the energy savings generated by the reduced energy costs thanks to the building retrofits.

An initial group of fifteen of the world's largest cities has agreed to participate in the retrofit program, and offer their municipal buildings for the first round of energy retrofits: Bangkok, Berlin, Chicago, Houston, Johannesburg, Karachi, London, Melbourne, Mexico City, New York, Rome, Sao Paulo, Seoul, Tokyo, and Toronto.

C40 CITIES

It sounds to me like a clever way to get something happening quickly that has no risk to developers and is profitable for investors. As long as the projected energy savings match the rate of return the banks are seeking. I wonder if it could work at a domestic scale.

N

Wow. That is really quite admirable coming from the heavy hitting investment banks. It almost makes me think that perhaps the carbon credit system might be going ahead in the USA. I always wondered how white collar services such as banking would gain carbon credits.

Do you have any information as to whether the local banks such as NAB or CBA have any plans to implement something similar? I suppose they would be ideal for getting the same system to enter the domestic market. On the skeptical side, I think for domestic users, there'd be a considerable amount of planning required to make sure that people taking the green loans actually used the money for making their homes more sustainable (read: not a new plasma screen).

It's really dissapointing that Westpac, who has taken out so many ad spaces to brag that they were the "greenest bank in the world" has yet to take the next natural step by offering these loans.

Perhaps the domestic sector is still up to the government? Afterall, I'm not sure if I'd want something as personal and necessary as domestic retrofitting to be up to the profit margins of commercial banks who at the end of the day only care about their bottom line. But somehow, I just don't see the current government lifting a finger to really help homeowners make themselves more sustainable.