Prepared for Coalition for Green Capital - PowerPoint Presentation

1. Prepared for Coalition for Green Capital18 December 2020, Version 2.0Supporting a Clean Energy Recovery Jobs and Emissions Impacts of a $100 Billion Clean Energy and Sustainability Accelerator

2. SummaryNational economic & climate impactState-level investment impact2

3. The $100 billion capitalization of the Accelerator would support 2.5 billion metric tons of cumulative emissions reductions over its first 10 years of operationWith $100 billion in federal capitalization, the Accelerator is expected to support $880 billion in clean investment over 10 yearsAccelerator-supported investment is expected to deliver 440 thousand jobs in its first year, and nearly four million jobs within its first four yearsBy 2030 the Accelerator is expected to deliver one fifth of the emissions reductions needed on a path towards net-zero emissions by 2050A Clean Energy and Sustainability Accelerator (Accelerator) supports millions of jobs, thousands of small businesses and billions of tons of emissions reductions3CO2Jobs & Emissions Impact of a $100 Billion CESA

4. Sample high-priority use cases demonstrate how $6 billion of Accelerator financing can support thousands of jobs and small businesses in target statesLooking at a subset of five high-priority use cases in targeted states across the US, Accelerator investment approaches can deliver over $20 billion in total investment – in turn supporting over 190 thousand jobs4Jobs & Emissions Impact of a $100 Billion AcceleratorAccelerator InvestmentUse CasesInitial target statesFive-year investmentJob creation impactSmall Business Building Upgrades Colorado, Minnesota, Missouri, Ohio, Texas$1.3 billion Accelerator / $4.3 billion total33,000 jobsHeating system electrificationConnecticut, Maine, Massachusetts, New York, Pennsylvania$0.6 billion Accelerator / $1.9 billion total14,000 jobsWhole home resilienceAlabama, Florida, Georgia, Louisiana, North Carolina, South Carolina$2.1 billion Accelerator/ $6.8 billion total56,000 jobsForest fire managementArizona, California, Idaho, Nevada, Oregon, Utah$1.1 billion Accelerator / $6.7 billion total72,000 jobsLow-Income Community SolarCalifornia, Delaware, Hawaii, Maryland, New Jersey, Washington DC$0.8 billion Accelerator/ $2.5 billion total18,000 jobsNote: Job creation is measured in job years for ease of comparison. For example, 1 job year is a job for 1 person for 1 year, while 5 job years may be a jobs for one person for 5 years, of a job for 5 people for 1 year – or other possible combinations.

5. SummaryNational economic & climate impactState-level investment impact1

6. With $100 billion in federal capitalization, the Accelerator is expected to support $880 billion in clean investment over 10 yearsThe Accelerator is expected to support $880 billion in clean investment over 10 yearsThe assessment models an initial federal capitalization of $100 billion, of which $30 billion is used for grant funding, $35 billion is used for low-cost loans over the first two years, and $35 billion is used as reserves for bond issuances beginning in year threeIn the third year of operation, the assessment models the deployment of a fully-fledged climate bank model, which includes balance sheet leverage on bond markets and expanded use of investment approaches, including commercial loans, equity investment and guaranteesOver 10 years this capitalization is expected to support $140 billion in direct investment from the Accelerator, supported by $750 billion in leveraged investment through bond market borrowing and project-level private co-investment6Jobs & Emissions Impact of a $100 Billion Accelerator

7. Accelerator-supported investment is expected to deliver 440 thousand jobs in year one & nearly four million jobs within four years – mostly in small businessesAccelerator-supported investment is expected to deliver almost 440 thousand jobs in its first year, ramping up to over three million and 800 thousand jobs within its first four yearsJobs are measured as ‘job years’ for comparison across different investment cases and policy options, where 1 job year equates to a job for 1 person for 1 year7Jobs & Emissions Impact of a $100 Billion AcceleratorThree fifths of jobs are created directly by investment activity – including construction, manufacturing, installation and ongoing operations – while two fifths of jobs are created indirectly in supply chainsAlmost two fifths of jobs created by Accelerator investments are expected in production and manufacturing jobs, with a further sixth of all jobs in installation or repairAccelerator investments and the economic stimulus they create will also support a wide range of associated white collar sales, administrative, management jobs across the USSmall businesses employ nearly two out of three clean energy workers

8. By 2030 the Accelerator is expected to deliver one fifth of the emissions reductions needed on a path towards net-zero emissions by 2050The $100 billion capitalization of Accelerator would support 2.5 billion metric tons of cumulative emissions reductions over its first 10 years of operationBy 2030, Accelerator investments would deliver 20% of reductions needed on a path towards 2050 net-zero emissionsInvestments would support 1 million metric tons in annual emissions reductions in its first year, rising to almost 460 million metric tons by 2030 – or 7% of US 2019 national emissions (6.7 billion metric tons)The Climate Crisis Action Plan identifies that to achieve net-zero emissions by 2050, US national emissions need to reach 37% below 2010 emissions by 2030, equating to a 2.3 billion metric ton reduction below 2018 emissions – with Accelerator emissions reductions in 2030 delivering 20% of these required reductions8Jobs & Emissions Impact of a $100 Billion AcceleratorSource: Vivid Economics, based on House Select Committee on the Climate Crisis (2020) Solving the Climate Crisis, EPA (2020) Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2018201820306,700 MMTThe remaining 80% can be met by other policies or increased funding to the Accelerator 20% of the gap – 460 MMT emissions reductions –– can be met through Accelerator investments from a $100 billion capitalizationUS National GHG Emissions4,400MMT

9. Investment SectorRepresentative Investment(s)Share of Accelerator Investment(%)Total Investment over 10 years ($ billion)2030 Annual Emissions Reductions(million metric tons)2030 Annual Emissions Reductions as share of required 2030 emissions reductions on 2050 net-zero pathway (%)Cumulative Emissions Reductions2021-2030(million metric tons)Renewable EnergySolar PV, Onshore Wind, Hydro40%35023010.3%1,300Grid Technology Energy storage, Smart meters10%88381.6%210Building Efficiency Rooftop Solar15%130532.3%270Industrial Decarbonisation Carbon Capture and Storage16%140321.4%140Clean Transport Electric vehicles, Electric Buses, Charging*14%120130.6%81AgricultureReforestation5%44893.9%490Total100%88046020.2%2,500We model emissions reduction potential based on representative investment cases across six potential high-priority mitigation sectors for the Accelerator* Charging infrastructure is excluded from emissions reduction calculations to avoid potential double counting with direct electric vehicle and bus investmentsNumbers rounded to 2 significant figures / 1 decimal place. Column totals may not match listed totals due to rounding.9Jobs & Emissions Impact of a $100 Billion Accelerator

10. SummaryNational economic & climate impactState-level investment impact2

11. Real-world investment ‘use cases’ help showcase job creation and impact potential for a portion of Accelerator investments in targeted geographiesA subset of five use cases explores the job creation and investment impacts potential of the Accelerator, based on previously identified sectoral or community needs in a diverse set of states11Jobs & Emissions Impact of a $100 Billion AcceleratorFinancing building efficiency and low-energy upgrades for small and medium businesses Small Business Building upgradesDrive community solar among low-to-moderate income (LMI) householdsLow-Income Community solarAccelerating phase out of high-carbon home heating systems (esp. fuel oil)Heating system electrificationInvesting in home strengthening + solar investments for resilience & mitigationWhole home resilienceSupporting improved forest management for fire mitigation and resilienceForest managementFor each use case, we model the jobs creation impact and financing needs and approach for an ambitious but realistic investment strategyWe consider ambitious, transformational strategies that specifically aim to deliver change on the scale needed to support the required long-term decarbonisation and to support short term job creation needsThese plans are also grounded in realistic expectations on likely levels of public Accelerator investment and real-world costs of investments

12. Investments in small business building upgrades could support almost 33,000 jobs over five yearsAn Accelerator investment of $1.3 billion could support $4.3 billion in total public & private loan investment in initial target states over the first five years of operationTechnologies include small commercial solar, electric water heaters & electric heat pumpsPriority states include Colorado, Minnesota, Missouri, Ohio, TexasAnalysis assumes that the Accelerator would support $2 billion of small commercial solar, $240 million in commercial water heater investment and $2.2 billion in commercial heat pump investment in target states between 2021 and 2025, in line with decarbonizing 100% of commercial buildings by 2035Note: Job creation is measured in job years for ease of comparison. For example, 1 job year is a job for 1 person for 1 year, while 5 job years may be a jobs for one person for 5 years, of a job for 5 people for 1 year – or other possible combinations.State job creation numbers may not sum to totals due to rounding.12Colorado2,000Minnesota 2,000Missouri1,700Ohio3,600Texas10,10019,300 JOBSDirect Jobs in Target States13,500 JOBSIndirect Jobs Nation-wideJobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business BuildingUpgrades

13. Investments in commercial building upgrades would also support substantial white-collar jobs in target states (3 in 10) – and make up a larger share of indirect nationwide jobs (almost 6 in 10 indirect jobs)7 in 10 jobs from investments in small business building upgrades in target states are in production, manufacturing, installation or repair13Jobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business BuildingUpgrades

14. Low- Income community solar investments could support almost 18,000 jobs over five yearsAn Accelerator investment of $760 million could support $2.5 billion in total public & private loan investment in initial target states over the first five years of operationBased on an average solar installation of 100KWPriority states include California, Delaware, Hawaii, Maryland, New Jersey, Washington DCAnalysis assumes that the Accelerator could support one fifth of total investment in community solar (similar to green market shares for other national green banks) in target states between 2021 and 2025, in line with creating a 100% decarbonize grid by 203514Direct Jobs in Target States10,300 JOBSCalifornia8,000Delaware100Hawaii700Maryland600New Jersey800Washington DC100Indirect Jobs Nation-wide7,300 JOBSJobs & Emissions Impact Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business Building UpgradesNote: Job creation is measured in job years for ease of comparison. For example, 1 job year is a job for 1 person for 1 year, while 5 job years may be a jobs for one person for 5 years, of a job for 5 people for 1 year – or other possible combinations.State job creation numbers may not sum to totals due to rounding.

15. LMI Community Solar investments would also support substantial white-collar jobs in target states (3 in 10) – and make up a larger share of indirect nationwide jobs (almost 6 in 10 indirect jobs)Almost 75% of jobs from low-income community solar in target states are in production, manufacturing, installation or repair15Jobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business Building Upgrades

16. Heating system electrification investments could support almost 14,000 jobs over five yearsAn Accelerator investment of $580 million could support $1.9 billion in total public & private loan investment in initial target states over the first five years of operationUse case based on residential heat pump replacements for domestic heating oilPriority states include Connecticut, Maine, Massachusetts, New York, PennsylvaniaAnalysis assumes that the Accelerator would support 25% of investment in replacement of domestic fuel oil heating in key northeastern states with high fuel oil use between 2021 and 2025 to help transition all homes away from fuel oil heating by 203516Connecticut1,100Maine600Massa-chussetts1,500New York2,100Penn-sylvania1,7006,900 JOBSDirect Jobs in Target StatesIndirect Jobs Nation-wide6,800 JOBSJobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business Building UpgradesNote: Job creation is measured in job years for ease of comparison. For example, 1 job year is a job for 1 person for 1 year, while 5 job years may be a jobs for one person for 5 years, of a job for 5 people for 1 year – or other possible combinations.State job creation numbers may not sum to totals due to rounding.

17. Just under 70% of jobs from heating electrification investments in target states are in blue collar professionsDomestic heating system electrification investments would also support substantial white-collar professional jobs in target states (3 in 10) – and make up a larger share of indirect nationwide jobs (almost 6 in 10 indirect jobs)17Jobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business Building Upgrades

18. Whole home resilience investments could support almost 56,000 jobs over five yearsAn Accelerator investment of $2.1 billion could support $6.8 billion in investment in initial target states over the first five years of operation through low-cost loansUse case based on ‘fortified’ style roof & window upgrades and rooftop solar investmentPriority states include Alabama, Florida, Georgia, Louisiana, North Carolina, South CarolinaAnalysis assumes that the Accelerator would support low-income households (eligible for federal weatherization support) among homes vulnerable to Category 5 storms in targets states between 2021 and 2025, addressing 10% of these low-and-moderate income storm-vulnerable households each year1830,600 JOBSAlabama400Florida19,200Georgia1,100Louisiana5,700North Carolina1,800South Carolina2,500Direct Jobs in Target StatesIndirect Jobs Nation-wide25,200 JOBSJobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business Building UpgradesNote: Job creation is measured in job years for ease of comparison. For example, 1 job year is a job for 1 person for 1 year, while 5 job years may be a jobs for one person for 5 years, of a job for 5 people for 1 year – or other possible combinations.State job creation numbers may not sum to totals due to rounding.

19. Almost three quarters of whole home resilience investment jobs in target states are in production, manufacturing, installation or repairHome resilience investments would also support white-collar jobs in target states (just over 2 in 10), while nationwide indirect jobs are relatively more concentrated in white-collar jobs (more than 5 in 10)19Jobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business Building Upgrades

20. Forest management investments could support almost 72,000 jobs over five years2046,700 JOBSArizona4,900California12,400Idaho8,700Nevada9,600Oregon 5,600Utah5,400Direct Jobs in Target StatesIndirect Jobs Nation-wide24,900 JOBSAn Accelerator guarantee reserve of $1.1 billion could support $6.7 billion in total investment in initial target states over the first five years of operationUse case based on forest and woodland harvesting, restoration and reforestation, land management, and supporting professional services and infrastructure investmentsPriority states have largest woodland exposed to wildfire risk: Arizona, California, Idaho, Nevada, Oregon, UtahAnalysis assumes that the Accelerator would support 10% of annual investment needed between 2021 and 2025 in the target states, in line with reducing fire risk across all highest priority states within a decadeJobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business Building UpgradesNote: Job creation is measured in job years for ease of comparison. For example, 1 job year is a job for 1 person for 1 year, while 5 job years may be a jobs for one person for 5 years, of a job for 5 people for 1 year – or other possible combinations.State job creation numbers may not sum to totals due to rounding.

21. Direct jobs in target states from forest fire management investments have a relatively equal share of blue- and white-collar jobsForest management jobs include a mix of different job types both in supported target states and nationwide, with larger shares of management, administrative and other jobs than many other potential Accelerator investment use cases21Jobs & Emissions Impact of a $100 Billion AcceleratorForest fire manage-mentWhole home resilienceHeating system electrifi-cationCommunity solarSmall Business Building Upgrades

22. Annex

23. This assessment uses Vivid Economics’s Investment & Intervention Impact Model (I3M) to assess the job creation potential from Accelerator investmentsI3M includes detailed breakdowns of how investment into a sector creates new one-off and ongoing transactions that increase economic activity and employment in associated supporting sectors, using sectoral disaggregation of economic activity in highly detailed input-output tables. Job creation is measured in job-years for both direct jobs (resulting from the investment itself, through construction or ongoing maintenance and operations) and indirect jobs (created throughout supply chains as a result of investments).23Jobs & Emissions Impact of a $100 Billion Accelerator

24. Additional detail on how the Accelerator’s $100 billion in federal capitalization can support $880 billion in investments and 12 million jobs over 10 years (1)Accelerator capitalization assumptionsYear-three bond market leverage at a ratio of 3:1 provides $70 billion in additional investment capitalPrivate sector leverage through co-investment ranges from 3.5:1 to 6.25:1 across different instruments24Jobs & Emissions Impact of a $100 Billion AcceleratorAccelerator supported investment($ billion, Accelerator investment + leveraged private investment)Funding typeYear 1Year 2Year 3Year 4Year 5Year 6Year 7Year 8Year 9Year 10TotalFast start grants15150000000030Fast start low-cost loans59596667891011181Leveraged climate bank investment001511511512430326569674Total74741581581583137417579884 Numbers rounded to 2 significant figures. Column totals may not match listed totals due to rounding.

25. Additional detail on how the Accelerator’s $100 billion in federal capitalization can support $880 billion in investments and 12 million jobs over 10 years (2)Job creation detailsJob creation by investment case, inc. share of direct jobs (after 10 years)Annual and cumulative job creation 25Jobs & Emissions Impact of a $100 Billion AcceleratorRenewable EnergyGrid Technology Building Efficiency Industrial Decarbonisation Clean Transport AgricultureTotalJobs created after 5 years1.70.40.60.71.70.45.5Jobs created after 10 years2.60.71.01.84.91.012.0Share of direct jobs (%)57%56%64%50%66%62%40%Jobs created by Accelerator investments (job years, millions)Year 1Year 2Year 3Year 4Year 5Year 6Year 7Year 8Year 9Year 10Annual jobs created0.40.61.21.51.71.21.11.21.41.6Cumulative jobs created0.41.02.33.85.56.77.99.010.412.0 Numbers rounded to 2 significant figures. Column totals may not match listed totals due to rounding.

26. Additional detail on how Accelerator’s $100 billion in federal capitalization can support $880 billion in investments and 12 million jobs over 10 years (3)Sectoral emissions reductions inputsEmissions reductions are built from bottom-up technology-level emissions reduction relationships26Jobs & Emissions Impact of a $100 Billion Accelerator Numbers rounded to 2 significant figures. Column totals may not match listed totals due to rounding.Investment SectorRepresentative Investment(s)SourcesRenewable EnergySolar PVEIA. 2020. Capital Cost and Performance Characteristic Estimates for Utility Scale Electric Power Generating Technologies. Onshore windEIA. 2020. (As above.)HydroEIA. 2020. (As above.)Grid Technology Energy storageEIA. 2020. (As above.) Smart metersUK BEIS. 2019. SMART METER ROLL-OUT: Cost-Benefit Analysis.Building Efficiency Rooftop solarEIA. 2020. (As above.)Industrial Decarbonisation Carbon capture and storageGillingham & Stock. 2019. The Cost of Reducing Greenhouse Gas Emissions.Clean Transport Electric vehiclesDOE. 2020. Alternative Fuels Data Center.Electric busesSierra Club. ND. Zero Emission Bus Fact Sheet.AgricultureReforestationWRI. 2020. Carbonshot: Federal Policy Options for Carbon Removal in the United States.

27. Accelerator Use Case AnalysisSmall Business Building Upgrades impact calculation & assumptions27Investment technology/iesSmall commercial solar – Based on average cost of small commercial installation (25 KW, $50,000)Commercial electric water heaters – Based on average cost for a commercial electric resistance storage water heater (total installation costs, $4,000)Commercial electric heat pumps – Based on average cost for a commercial heat pump ((total installation cost, $8,000)GeographiesColorado, Minnesota, Missouri, Ohio, TexasSelected from states with high existing support for C-PACE through policy and ordinancesMarket sizing Solar estimate based on annual investment need of $2 billion nationwide annually - $360 million in target states - to align with 100% decarbonization by 2035 (based on prior CGC analysis).Water heater investment based on estimates of $160 billion needed between 2020 and 2035 (based on Rewiring America analysis), equating to $1.9 billion annually in target states – of which the Federal Government would support 5%, and half of this through the Accelerator.Heat pump investment based on estimates of $1,500 billion HVAC investment needed between 2020 and 2035 (based on Rewiring America analysis), equating to $17.8 billion annually in target states – of which the Federal Government would support 5%, and half of this through the Accelerator.Jobs & Emissions Impact of a $100 Billion Accelerator

28. Accelerator Use Case Analysis Low Income Community solar impact calculation & assumptions28Investment technology/iesCommunity solar installation - Based on average cost of medium-large solar installation (100KW, $200,000)GeographiesCalifornia, Delaware, Hawaii, Maryland, New Jersey, Washington DCSelected from states that have implemented legislation to support community solarMarket sizing Solar estimate based on annual investment need of $5.6 billion nationwide annually for residential solar to align with 100% decarbonization by 2035 (based on prior CGC analysis) – assuming a consistent ratio of residential to community solar (based on ratio of installations), this equates to 60,000-65,000 community solar installations needed annually nationwide, and 14,000 in target states.Of these, the Accelerator could support just over one fifth of investments, in line with market shares supported by other national green investment banks. Jobs & Emissions Impact of a $100 Billion Accelerator

29. Accelerator Use Case Analysis Heating system electrification impact calculation & assumptions29Investment technology/iesResidential heat pump – based on average cost for a typical residential air source heat pump (total installation costs, $6,000)GeographiesConnecticut, Maine, Massachusetts, New York, PennsylvaniaSelected from states with highest use high-carbon heating (based on domestic fuel oil usage)Market sizing Assuming 5.5 million households nationwide using fuel oil heating must be decarbonized by 2035, the households requiring decarbonization in target states are estimated by the states’ share of nationwide domestic fuel oil consumption – 260,000 households annually in target states.Assume the government supports 25% of households’ total investment (based on Rewiring America analysis), of which all support comes from the Accelerator.Jobs & Emissions Impact of a $100 Billion Accelerator

30. Accelerator Use Case Analysis Whole home resilience impact calculation & assumptions30Investment technology/iesRoof and window fortification – Based on average costs for removing and replacing roofing with storm resilient shingles and replacing 10 windows (combined cost of $33,000)Rooftop solar – Based on average cost for residential solar installation (6KW, $17,000)GeographiesAlabama, Florida, Georgia, Louisiana, North Carolina, South CarolinaSelected from states with high existing exposure to storm damage and where insurance providers offer premium discounts for implementing resilience measuresMarket sizing Over 4.5 million single family homes are vulnerable to a Category 5 storm across the target states. Assume 25% of these households are eligible for Federal home weatherization assistance program support (a conservative estimate), and that 10% of these homes are addressed per year.Assume the government supports 25% of households’ total investment (assumption in line with Rewiring America analysis for home decarbonization), of which all support comes from the Accelerator. This equates to 140,000 households supported over five years.Jobs & Emissions Impact of a $100 Billion Accelerator

31. Accelerator Use Case Analysis Forest fire management impact calculation & assumptions31Investment technology/iesForest management – Based on on package of activities forest and woodland harvesting, restoration and reforestation, land management, and supporting professional services and infrastructure investments ($1,000 per treated acre)GeographiesArizona, California, Idaho, Nevada, Oregon, UtahSelected from states with greater areas of land exposure to ‘high’ and ‘very high’ Wildland Fire PotentialMarket sizing 226 million acres nationwide exposed to high or very high Wildland Fire Potential, of which 133 million acres are in the six identified target states. Each acre to be treated once per 10 years, suggesting treatment is needed for 67 million acres over 5 years in target states.Assume that assume 25% of investment is supported by the National Fire Service, with equal match from state or local government, and that the Accelerator supports one fifth of the remaining 50% of investment.Jobs & Emissions Impact of a $100 Billion Accelerator

32.