CREBs in Brief
The Clean Renewable Energy Bond (CREB) program is administered by the Internal Revenue Service and provides bond authorization for public entities on a competitive basis for renewable electricity projects. The benefit of the CREB program is that public entities receive the bonds at “zero” percent interest. The revenue or cost savings from the renewable electricity systems are utilized to pay off the bonds.
The program was initially authorized via the Energy Policy Act of 2005 and designed as an alternative to the Production Tax Credit (PTC)—which can be utilized by private renewable energy developers and investor-owned utilities—to be used by cooperative electric and public power utilities. Beyond these utilities other eligible entities include schools, local governments, tribal governments. The program has provided two rounds of bonding authorization—610 projects during the first round and 312 projects in the second round.
Could this funding mechanism work for my project?
That’s what our recent West Central CERT meeting on April 29, 2008, “Clean Renewable Energy Bonds (CREBs): A Tool for Renewable Energy Financing” in Sunburg, MN was all about.
Check out the notes for a detailed summary of thoughts, both pro and con.
In brief, it sounds as though CREBs might work well for small wind project and solar electric projects, but that some Minnesota K-12 school districts have had trouble making them work for their own large scale wind projects.
Presentations from the meeting:
Utilizing Clean Renewable Energy Bonds for Our Communities (1mb pdf) – Cory Marquart, WCROC
CREBs with 40 MN School Districts (750kb pdf) – Arif Quraishi, Johnson Controls
Related Article: Clean Renewable Energy Bonds fuel UMM’s energy goals – UMM News