"Thanks so much for sending me EcoMotion. I love it.”
Don Conoscenti, Musician, Taos, New Mexico
Green Finance with Bob Barton
What a week it’s been for EcoMotion, a week immersed in learning about the range of financial mechanisms available to support energy efficiency and alternative energy, specifically for EcoMotion’s client, Santa Monica.
Thanks to a week- long EcoMotion assignment, Bob Barton was our expert tutor and guide into the evolving world of conventional and non-conventional finance.
Bob is the Chief Executive Officer for Catalyst Financial Group, a firm that has thus far financed over $2 billion in energy efficiency and alternative energy projects. He considers himself a change agent, his financing skills aligned with his passion for social responsibility. He was a founding member of the Social Venture Network. His stories of actual project finance of green projects – from manure digesters to eco-friendly shoes, coffee beans, wind turbines, and more -- illustrated the wealth of mechanisms available to overcome the first cost hurdles and longer paybacks of green projects, notably solar systems.
Throughout the week, Bob dissected EcoMotion’s project works in Santa Monica and Palm Desert, seeking financial fits between lenders and borrowers for specific customer segments.
The number of instruments, compounded by the number of types of lenders, is remarkable, with small boutique lenders for every conceivable market niche. All sorts of grants, loans, and leases are available for different customer types and NAIC codes, with different financing for agricultural endeavors, industrial, municipal, low-income, non-profit, housing, etc. Finding the correct linkages, and articulating deals in terms that fit specific lending criteria, is an art and a science, and Bob’s specialty.
For EcoMotion’s municipal clients, Bob Barton presented select financial instruments, from linked deposit accounts to tax exempt leases for municipal governments. For homeowners, Bob presented new information on Fannie Mae’s unsecured energy efficiency loans while emphasizing the value of home equity lines and loans for other program participants. A number of means to buy-down interest rates and to secure loans were discussed, all part of Barton’s 16-part anatomy of the deal. (Stories underscored fact that convenience and timing can overcome interest rates in consumers’ spending criteria.)
And there are new trends to consider: Imagine a City (or utility) having a privately labeled credit card, with a point flowing back to support beneficial community projects!
On Friday, Bob ended his week-long whirl-wind tour with an invitation-only, EcoMotion seminar on trends in Financing Energy Efficiency and Alternative Energy. Participants included Richard Henrikson, Michael Brown, the Tech Coast Venture Network, and reps from the U.S. Green Building Council and the City of Irvine. One participant articulated the group’s captivation by Bob’s tales from the trenches of green finance, “There wasn’t anything that wasn’t interesting.”
California is the bell-weather state once again, this time in the fight against global warming. This past week Governor Arnold Schwarzenegger signed Senate Bill 107 into law, a bill that accelerates the State’s mandate for investor-owned utilities to meet the 20% renewable Portfolio Standard by 2010, fully seven years ahead of the previous 2017 deadline. The new legislation allows the State’s utilities to purchase renewables from out of state sources, but prohibits the use of RECs (renewable energy credits) to reach the bill’s requirements.
In June, Schwarzenegger got way out in front of the states by signing Executive Order #S-3-05 which set aggressive greenhouse gas targets, cutting emissions by 2010 to 2000 levels, in 2020 cutting emissions to 1990 levels, and slashing 1990 levels by 80% by 2050. A Climate Action Team is now guiding the Governor in his policy pursuits to reach the Order’s targets.
Branson Commits $3 Billion to Climate Change
This past week, Sir Richard Branson committed $3 billion to finding solutions to global climate change. It was the largest independent contribution to fighting global warming.
Branson will commit 100% of his profits for the next ten years from his travel- related companies (Virgin Atlantic Airline and Virgin Trains) to the cause, investing in the alternative fuels that he sees as critical for the future of air travel and other forms of transportation. A commitment like Branson’s, Al Gore emphasized, “moves the world.”
When asked by Diane Sawyer about his prior skepticism on global warming on Good Morning America this past Friday, Branson sat next to Al Gore and related that, “I was skeptical. But I met with lots of scientists, read lots of books, sat down with Al Gore for a couple hours at my home, and sadly I am now convinced that the world has a serious problem.”
Gore added that, “All of us have problems absorbing the reality of what we are facing, a global emergency. We are currently pumping 70 million tons of global warming gasses into the earth’s atmosphere every 24 hours. If a child has a fever, you go to the doctor. Well, the planet has a fever, and we’ve been to the scientists. They tell us that we need to stop pumping all the pollution up there, to turn down the thermostat.”
Gore salutes business leaders that “are way ahead of politicians from both parties” on this issue. He stresses that it is not too late. “What’s needed is a commitment to change.” And there is money to be made in a new energy paradigm. He hopes that Branson’s commitment turns into a sound investment, one that benefits society and investor alike.
President Bill Clinton has launched the Clinton Climate Initiative, “dedicated to making a difference in the fight against climate change in practical and measurable ways.”
Clinton believes that, “It no longer makes sense for us to debate whether or not the Earth is warming at an alarming rate – it is our responsibility to do something about the crisis.”
In early August the Clinton Climate Initiative (CCI) announced its first program at a press conference in Los Angeles. Joined by British Prime Minister Tony Blair, Los Angeles Mayor Villaraigosa, London Mayor Livingstone, and San Francisco Mayor Newsome, President Clinton announced that CCI will join with the Large Cities Climate Leadership Group, assisting large cities in reducing greenhouse gas emissions and increasing energy efficiency. Urban areas account for 75% of the world’s greenhouse gas emissions.
The CCI—Large Cities partnership begins with 24 of the largest cities in the world participating: Berlin, Buenos Aires, Cairo, Caracas, Chicago, Delhi, Dhaka, Houston, Istanbul, Johannesburg, London, Los Angeles, Madrid, Melbourne, Mexico City, Moscow, New York, Paris, Philadelphia, Rome, Sao Paulo, Seoul, Toronto, and Warsaw.
CCI is fast out of the blocks and in the national news with a recent, two-day summit that drew the notable support of both First Lady Laura Bush and Sir Richard Branson who pledged $3 billion on Day Two. So far, thanks to Clinton’s work, the CCI has raised $7.3 billion through 215 commitments. (see www.clintonfoundation.org
The New -- LEED Gold -- World Trade Center
New York Governor George Pataki has announced that the Freedom Tower and other buildings in the new World Trade Center complex will be designed to achieve LEED Gold certification. The U.S. Green Building Council (USGBC) LEED certification assures that the new complex will be a model of green building and will stand as a symbol of the city's commitment to a healthy and sustainable future.
The Freedom Tower; the World Trade Center Memorial and Memorial Museum; and World Trade Center Office Towers 2, 3, and 4 will all be designed to achieve LEED Gold certification and to be 20% more energy efficient than required by New York energy codes. The Freedom Tower and World Trade Center Office Towers will draw on four fuel cell systems for 4.8 megawatts of power, while the New York Power Authority and Silverstein Properties will buy a total of 184 million kilowatt-hours of renewable energy credits to offset the remaining power needs for the complex. World Trade Center 7 --photo above -- completed early this year, achieved LEED Gold certification in March.
Recognition: Eddie Schultz, Gardener, Sylmar, CA
Eddie Schultz is really proud of his new GEM. And he is especially happy on those days he leaves his 8 mile per gallon Dodge Ram pick-up at home, using his GEM instead. As a gardener, he needs tools, and both vehicles provide him ample space.
“With the price of gas these days,” he recounts, “I like using the GEM whenever I can.”
He can get 22 miles on a charge – more than enough for one day of rounds -- and he often “fills up” at customers’ homes while he’s working. He also carries a generator, just in case.
The GEM weighs 1,570 pounds and can carry another 1,400 pounds. It has a top speed of 25 mph, with 13” street-legal tires and a 35’ turning radius. It is powered by 9 8-volt maintenance-free gel batteries.
Eddie says that he paid about $10,000 for his GEM in May. He figures that his electric bill may have increased seventy five cents a day, but he hasn’t even noticed it. What he has noticed is much less gas going to the Ram, and lower gas bills. So when he can avoid hills and heavy loads, he chooses the open-cabined GEM for his work and profit. Any regrets Eddie? “No. In fact, my Mom just bought one, too!”