As promised in the Climate Change Action Plan, Ontario recently announced the creation of the Ontario Climate Change Solutions Deployment Corporation, also known as the Green Bank. The new provincial agency was created by the recently enacted regulation, Ontario Climate Change Solutions Deployment Corporation (O.Reg 46/17). It will “focus on reducing market barriers to deployment of low-carbon technologies, including through improved access to information, incentives, and strategic use of financial de-risking tools to encourage greater private sector investment, emphasizing absolute greenhouse gas reductions through activities such as fuel-switching, energy storage, use of renewable energy and deep energy retrofits.” As set out in the Climate Change Action Plan, Ontario will provide funding for the Green Bank of up to $1.1 billion starting in 2018 from cap and trade auction proceeds.
In developing the green bank, Ontario drew on the experiences of two existing US models: Efficiency Vermont and the New York Green Bank. Efficiency Vermont is a statewide energy-efficiency utility that provides incentives and services to help Vermonters reduce electricity use. Efficiency Vermont reports that through its efficiency programs, it meets 14% of Vermont’s electric needs at about half the cost of generated power. Efficiency Vermont is funded in part by electricity rate payers and in part by cap and trade proceeds collected in its jurisdiction.
The New York Green Bank is a state-run specialized financing agency. It works with the private sector to increase investments in New York’s clean energy markets and its current portfolio includes investments into residential efficiency, distributed wind, residential and commercial solar and property assessed clean energy (PACE). PACE offers commercial property owners financing for energy efficiency, renewable energy and water conservation upgrades. The New York Green Bank is funded in part by proceeds raised from a regional cap and trade program.
During consultations on the regulation, LDCs noted the potential for the Green Bank’s activities to compete with existing CDM initiatives under the Conservation Framework and the possibility for confusion in the market place. The Ministry of Environment and Climate Change (MOECC) responded that it would address these concerns through program design, ongoing discussions, and in an MOU between the Green Bank and MOECC. Further, the regulation was revised to specify that the Green Bank will maintain a website that includes information about its programs as well as programs offered by other providers.
The province has not yet announced its appointees to the Green Bank’s inaugural Board of Directors.