Janet Yellen was recently sworn-in as the first female US Treasury Secretary, with bipartisan support! This puts her at the forefront of the world’s largest economy.
As another first, Secretary Yellen has pledged to set up a team to focus on climate change within the Treasury. We’re optimistic about this high-level recognition of the real threats posed by the climate crisis, as well as the opportunities for reevaluating financial regulations to encourage a sustainable economy.
For example, tax incentives already play a meaningful role in solar project development. It was also the focus of our last blog. The current investment tax credit system is needlessly restrictive, hindering the feasibility of smaller community-scale solar projects. Yellen can address this by pushing for refundable extensions for tax credits, or allowing for a cash grant to be made in lieu of tax credits for community-scale projects.
Financial regulations can and should compel investments that mitigate climate change, and can also help protect investors by requiring publicly traded companies to report the climate-related material risks to their businesses. These risks come from physical threats to supply chains and infrastructure, and transitional risks as the world moves past a fossil fuel based economy and further toward one powered on clean energy. Yellen’s climate team is a good start domestically, but we really need an all-out mobilization on clean energy finance!
As the World Bank’s largest shareholder, the Treasury can apply pressure towards essential goals, such as divesting from the fossil fuel industry. Domestically, Yellen is now one of the foremost players who can champion and raise green infrastructure and clean energy investments, for both short term relief and longer term recovery efforts. The Treasury can move federal capital through community development block grants to assist states and cities in rebuilding for energy efficiency and consumer savings while creating jobs. Evergreen Action’s Clean Jumpstart Plan calls for a $1.5 trillion investment in state-run relief and 21 federal programs that can help to stimulate and rebuild the economy.
This effort doesn’t need to be a brute use of power. Rather, the US Treasury could use its influence to be a productive force with demonstrative results for domestic departments and the rest of the world to follow. This is leading not just by the example of power, but by the power of example.
It’s also crucial that regulatory incentives shouldn’t overlook disadvantaged communities, who are often the most vulnerable to climate change. Energy efficient homes should be accessible for all demographics, and solar infrastructure should be integrated on a local level. The Treasury can consolidate its efforts by creating a national green bank that fosters private capital investment, making climate action projects more accessible for local communities.
This is our mission at Raise Green! We act as an intermediary between communities wanting to organize into collective action by creating and financing their own climate solutions, and individuals and businesses who financially support those efforts. Imagine what we can do together with the full support of the world’s largest economy!
If you’re interested in starting your own clean energy project, Raise Green can support both the development (Originator Engine) and funding (Marketplace). Or if you’re interested in investing in an existing project, you can create an investor account for free here.
As always, feel free to send any questions or comments you might have to info@raisegreen.com.
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