C40 Cities has published a guide on why and how cities should explore this sustainable approach to financing, based on the experiences of major locally operating green banks.
C40 Cities is urging leaders to explore the use of city green banks as a mechanism to deliver a Covid-19 recovery plan that prioritises the environment and local communities.
It has published a step-by-step guide as part of its Financing Sustainable Cities initiative on why and how cities can launch their own local green bank. It states that as well as help fuel a green and just recovery from Covid-19, green banks can support the health and safety of residents for decades to come.
Establishing a City Green Bank is based on the experiences of major locally operating green banks. A green bank is a public, semi-public or not-for-profit institution that offers a variety of financial products focusing specifically on climate mitigation projects, such as renewable energy and energy efficiency programmes.
“City-level green banks have the potential to deliver low-cost investment through a self-sustaining mechanism, offering long-term environmental, social and economic benefits for people,” said Claire Markgraf, head of financing of C40 Cities’ Sustainable Cities Initiative.
C40 mayors and cities are working to guarantee a recovery from Covid-19 that is sustainable, resilient and equitable. C40 highlights that cities were already facing substantial challenges in accessing capital to deliver Paris Agreement-compliant action and must now overcome the additional strain the global pandemic has had on municipal budgets globally.
“Green banks are becoming a critical part of the financial ecosystem that can deliver numerous benefits to communities throughout the world”
As such, directing stimulus funds towards the development of green banks would catalyse private sector investment in local low-carbon, climate-resilient (LCR) infrastructure promoting job creation, spurring the green economy, strengthening equity and inclusion, and delivering on the climate agenda.
The American Green Bank Consortium reports that, as of the end of 2019, every dollar of investment made by an American green bank resulted in $3.60 of total investment in a clean energy economy. C40 Cities said there is overwhelming evidence proving that the development of green banks directly benefits urban residents through employment opportunities, emissions reduction and provision of affordable energy upgrades.
“We want to thank C40 Cities for spearheading the publication of this guide, and the many green banks that contributed to it,” said Curtis Probst, co-CEO of New York City Energy Efficiency Corporation (NYCEEC), co-author of the guide. “Green banks have enormous potential to catalyse much-needed investment in clean energy infrastructure. They are becoming a critical part of the financial ecosystem that can deliver numerous benefits to communities throughout the world.”
The guide is available to all cities through the C40 Knowledge Hub.
You might also like: