NYSERDA offers a set of loans under the Green Jobs-Green New York Program (GJGNY) to help New York State residents finance energy efficiency improvements and renewable energy systems. Power Purchase, Lease, and Purchase Agreements (PPAs) are the most popular financing options. See our table for comparison and for helpful tips. However, capital expenditures have not grown in line with profits, suggesting that companies may be increasing their cash holdings compared to investments in energy assets in the face of political and market uncertainties in some areas.
In addition, as more and more customers come to CCAs, California regulators and utility companies are faced with the growing challenge of managing fees and charges in a way that helps finance fixed investment in the network. Renewable energy has played an increasing role, as private entities own nearly three-quarters of investment; energy efficiency, which is dominated by private spending; and private-sector-led spending on networks and battery storage. The next section evaluates a related trend from a broader point of view: the recent dramatic increase in sustainable finance and related regulatory developments, and how this trend is also related to investment in energy. However, there are also broader questions about the scalability of this model in current investment frameworks: while retail competition is present in 17 US states.
In the US, only 8 of them allow CCAs. The program provides guaranteed loans and grants to agricultural producers and small rural businesses for renewable energy systems or to make improvements in energy efficiency. Its contracting, financing and payment models allow consumers (mostly commercial and industrial actors) to overcome the initial capital burdens of investing in renewable energies. In Indonesia, the utility company, which is already facing financial problems, has seen the debt burden increase due to a combination of currency depreciation and a large part of foreign currency loans.
Financial markets can play a role in amplifying energy investment, both downward and upward. A broader question is to what extent normally passive investors can become more active and try to exert more influence over energy companies in terms of strategy and decisions on capital expenditures and dividends. In recent years, investors and policy makers have broadly promoted three areas to align decision-making in the financial sector with the improvement of sustainability in the real economy. Financing has been obtained both through debt and equity channels, although in the past five years, its provision of debt for projects and the purchase of project bonds have increased, in part due to the changing nature of transactions with assets related to energy and infrastructure.
Financing activity has remained more limited in emerging economies, where investment risks are higher and capital markets are less developed, although transactions in India and Brazil, where the government has promoted tax-exempt local infrastructure bonds, have picked up in the last three years; in China there are no disclosed transactions, making it difficult to assess the real level of activity. Institutional investment in energy usually takes the form of securities traded in equity and debt capital markets. Learn more about these programs and how they can help you, whether you're an energy startup looking to launch a pilot project, a company with proven technology that needs help to reach a commercial scale, or a state, local, or tribal government seeking funding resources for energy projects.