GE Energy Financial Service has reached its multiyear target of building a $6 billion portfolio of renewable energy investments by the end of 2010. Renewable energy now comprises nearly 30% of the company's overall portfolio, up from about 6% in 2006.
In 2009 and 2010 to date, the business unit invested or committed to invest more than $1.5 billion in wind farms, closed transactions in geothermal and hydroelectric power generation, and made venture capital investments in smart grid and renewable energy companies.
Cumulatively, the projects and companies have supported thousands of green collar jobs worldwide, helped grow the multi-billion-dollar U.S. renewable energy manufacturing industry, and – according to U.S. Environmental Protection Agency methodology – avoided more than 23 million tons a year in global greenhouse gas emissions, equivalent to taking all the passenger vehicles off the road in the Washington, D.C., metropolitan area.
GE Energy Financial Services started investing in renewable energy in 1987. It had amassed a $3 billion portfolio by January 2008, when it set a target of reaching $6 billion by the end of this year.
The investments have spanned 14 countries, 95 wind farms, 40 solar installations, six hydroelectric projects, 12 landfill-gas facilities and 15 projects involving other technologies across a wide spectrum of capital – from project equity to debt and venture capital, according to the company.
Across the U.S., GE Energy Financial Services has made approximately 75% of its renewable energy investments in states with renewable portfolio standards or regulations requiring increased electricity generation from renewable sources.
‘Consistent policy provides the certainty investors need to provide long-term capital, which drives new technology and creates jobs,’ says Kevin Walsh, managing director and leader of power and renewable energy at GE Energy Financial Services. ‘We are specifically calling on the U.S. government to extend the U.S. Treasury grant renewable energy program, which has played an important role in financing renewable energy projects during the past two years.’
The Section 1603 U.S. Treasury grant program created under the American Recovery and Reinvestment Act allows renewable energy project owners to access a cash grant in lieu of tax credits. The current program is set to expire at the end of this year.
The GE unit's research has shown that investments in the wind industry have risen and fallen with the renewal and expiration of renewable energy incentives. The expiration of incentives in 2000, 2002 and 2004 caused a 76 % to 90% drop in installed capacity in the U.S. from the previous year.
SOURCE: GE Energy Financial Services