(Yale Center for Business and the Environment)
Before the federal government discontinued the United States Department of Energy’s (DOE) Qualified Energy Conservation Bond (QECB) program in 2017 as part of its tax reform package, states like Virginia leveraged this program to accomplish energy efficiency goals.
When evaluating how to use Virginia’s QECB allocation, decision makers considered the increased flexibility of Green Community Programs (GCPs) relative to traditional QECBs and “qualified” projects.
GCPs can issue bonds for any mix of public and/or private projects. In contrast, under the traditional QECB structure, a maximum of 30% of allocations can be issued for private projects.
In addition, GCPs are not subject to the 20% energy-reduction requirement. This broad scope and relaxed requirements allow them to be structured and operated on a case-by-case basis, leaving significant room for creativity and adaptability to different states, locations, and projects.