The Lineup: New York

To be administered by New York State Energy and Research Development Authority (NYSERDA), New York’s soon-to-launch $1 billion green bank will look to enhance private credit and round out capital stacks when lenders are unwilling to cover entire project costs.

In September, NYSERDA formally requested the bank’s first round of capitalization funds, amounting to about $165 million in previously uncommitted tax revenues, from the Public Service Commission.

The state bank will aim to help facilitate markets for credit-enhanced bonds backed by pooled clean-energy loans. Warehousing such loans before securitization will help standardize loan terms – and will also help get this generally longer-term debt to institutional and other investors comfortable with these extended durations.

Recent legislation likewise authorizes NYSERDA to underwrite energy-efficiency improvement loans to be repaid through utility bills. While this may well be the most substantial on-bill repayment program launched in any state so far, New York’s program would at least initially be limited to apartment properties, small-business accounts and single-family homes.

– Brad Berton

View information on how other states have approached green retrofit financing.