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By Rod Richardson
Co-Founder, Clean Capitalist Leadership Council; The Grace Richardson Fund
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We've had a robust discussion this past week on Rod Richardson's "CoVictory" tax-exempt bonds and loans, and other free market clean energy policies that can benefit the development of the clean energy industry. See some of the comments below! See also the related webinar recording on the discussion page.
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"I would not use them.... even for ventures that ultimately succeed, it’s extremely hard to predict how long the 'runway' will need to be before takeoff. A new venture might bleed cash for one, two, five, or even ten years before turning profitable. For that reason, entrepreneurs shun bonds in favor of equity offerings for raising capital. Even if bond offerings for a high risk venture are able to find buyers, they carry unforgiving repayment schedules. Those schedules can force a promising but not yet profitable venture into premature bankruptcy."
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"CVBLs are not meant for early-stage speculative clean energy startups that seem to concern you. Another set of clean tax cut proposals address early stage clean energy innovation (see here).... Tax exempt private debt, however, will work quite well for profitable energy infrastructure projects at scale. ...the purpose of CVBLs is to accelerate COVID recession recovery."
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"There are many small companies that are developing projects in mature clean energy asset classes—think solar and wind farms. They currently can only access local bank debt and having access to these bonds would significantly boost the number of projects they develop that would pencil. This is the stimulative point of the bonds." - Jigar Shah, President, Jigar Shah Consulting
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"...your biggest immediate hope might be for bonds outside the usual U.S. sectors. Alter Steenbock of Brazil has presented some of us evidence of really impressive new opportunities in regenerative agriculture, starting from concepts like terra preta and advanced livestock management, outside the biased and limited scope of bonds like the ones which gave us the old CDM disasters." - Paul Werbos, retired Program Director for Energy, Power, and Adaptive Systems, National Science Foundation
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Log in and add your comment to any of the questions above or the questions below: |
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New Publications in the OurEnergyLibrary |
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Center for Strategic and International Studies
July 9, 2020
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Rocky Mountain Institute
July 14, 2020
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Update from Congress
New Legislation
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Global oil supply far exceeds demand right now as the coronavirus pandemic keeps travel restrictions in place and commuters working from home. In this podcast, commodities analysts Leigh Goehring and Adam Rozencwajg (managing partners of Goehring and Rozencwajg) , argue that the pandemic and current oil market conditions will be a catalyst for a coming global energy crisis.
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When: Tues, Aug 18, 5-7 p.m. Eastern Time
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When: Wed, Aug 19, 10 a.m. Eastern Time
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When: Wed, Aug 19, 3-4 p.m. Eastern Time
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When: Mon-Thurs, Aug 24-27
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The Our Energy Policy Foundation is a non-partisan, 501(c)(3) non-profit and does not have or endorse any specific political, programmatic, policy, or technological agendas, but rather seeks to encourage a broad discussion of all points of view. OurEnergyPolicy's mission is to facilitate substantive, responsible dialogue on energy policy issues and provide this dialogue as a resource for the public, policymakers, and the media.
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