Connecticut Green Bank Solar For All Program

Connecticut founded the first green bank in the country in 2011 by an act of the state legislature. Since then, Connecticut Green Bank has successfully hybridized public funding with private resources and investment to increase the availability of green energy in the state. The bank’s investments include both commercial and residential renewable energy solutions, resources promoting affordable financing for electric vehicles, and homeowner energy efficiency upgrades. In 2015, Connecticut recognized that its standard incentive program for homeowners, the Residential Solar Incentive Program (RSIP), had successfully promoted residential solar development, but was serving very few low-income homeowners. The Green Bank developed a model for providing LMI homes with cost-effective residential solar power and energy efficiency. In the program, titled Solar for All, the bank provides financial support to PosiGen, a solar company, which uses this financing to build solar panels on LMI homes. PosiGen retains ownership of the panels, benefits from the solar rebates provided under the RSIP, and leases the solar panels to homeowners. PosiGen also assists homeowners in making efficiency upgrades. Homeowners benefit financially by avoiding large upfront payments for their solar systems, and by reducing electricity costs. Additionally, all PosiGen customers receive efficiency upgrades. The average PosiGen customer in Connecticut receives a net financial benefit of $700 in the first year.  For the first six years of solar panel operation, PosiGen owns and benefits from the Renewable Energy Credits – the excess power created by the panels. Ownership of these credits is then transferred to the Bank, which makes back some of the money it spends on the RSIP. 

Connecticut Green Bank has invested a total of $282 million towards in-state projects with a total value of over $2 billion, garnering a leverage ratio of 6:1 for private to public funds. The ratio of private funds raised for each dollar of public funds has been growing each year. The bank also estimates that its investments over its lifespan have:

  • Directly and indirectly created over 22,500 jobs in Connecticut
  • Generated $93.4 million in state tax revenues
  • Deployed over 416 MW of clean energy capacity, which in turn has:
    • Helped avoid over 8.7 millions tons of CO2 emissions
    • Created a public health benefit of approximately $228-$516 million in value 


Connecticut Green Bank, like all financial institutions, is not innately designed to promote equity in low income and disadvantaged communities. For example, the PosiGen Solar for All program was established in 2015, four years after the initial founding of the bank and only in response to a clear lack of focus on LMI communities. The Solar for All program is also the only Connecticut Green Bank program targeted towards a disadvantaged population, and operates based on income without a geographic or neighborhood component. Equity concerns remain important in green banking as taxpayer funds, including those from disadvantaged communities, are used towards projects that, while environmentally friendly, pose benefits for contractors and capital owners and not disadvantaged communities themselves. Connecticut Green Bank currently offers separate incentives for both large scale contractors and landlords, but only the Solar for All program for disadvantaged communities. 


Future green banks can follow Connecticut Green Bank’s model of hybridizing public and private funds towards green projects while incorporating equity concerns. Connecticut Green Bank has been successful in scaling its public dollars, reaching a ratio of 6:1 of private to public dollars. This success can be spread more equitably through guardrails on the bank’s investments and designating certain areas for bank investment. Cities and states can also mandate that green banks provide a certain percentage of their services towards disadvantaged communities in the legislation chartering the bank’s creation. Connecticut Green Bank recognized that it could further serve LMI communities in 2015, and green banks formed in the future can incorporate those concerns from their inception. 

 

Publication Date: 2015

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