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ENERGY POLICY: Domenici unveils plans for federal 'clean energy' bank (03/03/2008)
Ben Geman, E&E Daily senior reporter
Sen. Pete Domenici (R-N.M.) will attempt to shake up the debate on the deployment of low-carbon energy sources by unveiling legislation this week to create a federal investment bank to finance "clean" energy projects.
Aides to Domenici, the ranking member of the Energy and Natural Resources Committee, said the bill would create a government corporation to finance domestic clean energy projects modeled on institutions such as the Export-Import Bank of the United States and the Overseas Private Investment Corp.
The "Clean Energy Investment Bank of the United States" would provide a variety of financing tools for projects such as renewable power, coal plants that control carbon dioxide, new nuclear plants and other technologies, Domenici's aides said.
"What we are doing is ensuring that domestic energy projects have the same level of support as U.S. companies get for investing overseas," said Matt Letourneau, Domenici's committee spokesman.
The bank's governing board would make decisions on what types of projects to finance, as long as they met the overall requirements of reducing, avoiding or sequestering various types of emissions, Letourneau said.
Frank Macchiarola, the committee's GOP staff director, said the bill is designed to help fill a gap in the financing of these kinds of projects in the United States.
"There is a significant amount of debt financing for traditional fossil fuel projects," Macchiarola said Friday. "For clean energy, we think there has been a problem in getting debt financing. ... Our thinking was, how do we facilitate the movement of capital to clean energy?"
The goal of the bank would be to finance projects that use new technologies that are commercially available, Macchiarola added. Financing tools could include loans, loan guarantees, taking an equity position, insurance and other options.
In order to begin financing projects, the bank would borrow from a special clean energy fund that would be established in the U.S. Treasury, the aides said. Ultimately, the bank is designed to be essentially self-financing in its support for projects.
Domenici's aides did not provide specifics on how much overall financing the bank would be able to provide.
Aides said Domenici is hopeful the plan will win support across the aisle, although the inclusion of nuclear plants may prove divisive. "We believe this is an idea that addresses climate change that would have wide bipartisan support," Macchiarola said.
The bank would be governed by a seven-member board. Five of the members are appointed by the president and would have to be confirmed by the Senate, and no more than three can be from the same party. These five members would then appoint a president and executive vice president.
Under the bill, the bank would assume control of the clean energy loan guarantee program from the Energy Department. The loan guarantee program was authorized under the sweeping 2005 energy law, but DOE has faced criticism for being slow to get the program off the ground.