In this episode, Reed Hundt, the CEO of the Coalition for Green Capital, discusses the merits of green banks, quasi-public or nonprofit institutions that provide seed capital to accelerate the growth of clean energy. There are more than 20 active green banks at the state level. Now Biden has proposed a federal green bank. Hundt explains how it could help.Full transcript of Volts podcast featuring Reed Hundt, August 13, 2021(PDF version)As we speak, Democrats in Congress are at work putting together a budget reconciliation bill that will include enormous swathes of President Biden’s agenda, including his climate agenda.One of the policies being discussed for inclusion is the creation of a “Clean Energy & Sustainability Accelerator,” more commonly known as a green bank.The idea of a federal green bank has been floating around forever. There was one in the ill-fated Waxman-Markey climate bill of 2009 (which never made it through the Senate) and there’s been one introduced in Congress virtually every year since. But this time it might happen! So it’s time to brush up on what a green bank is and what it does.It would not, contrary to some popular misconceptions, be an agency of the federal government, nor would it finance projects purely with federal money. Rather, it would be an independent, nonprofit entity that uses an initial grant of federal money to pull private capital off the sidelines and into climate-related projects. After the initial grant, the bank would be self-sustaining.The model has been tested: there are green banks in more than a dozen states, which have generated $5.3 billion in clean energy investment since 2011, including $1.5 billion in 2019 alone. And there are more than 20 states where the process of establishing a green bank has begun.These state- and city-level green banks are popular and successful, but because states and cities tend to be short on funds, they too often lack the capital needed to fund worthy projects. Right now there are more than $20 billion worth of projects that are eligible for green bank funding and are now waiting. One of the roles of a federal green bank would be to capitalize all those local banks, to get all those projects rolling.To learn more about green banks, I was happy to talk to their greatest champion: Reed Hundt, the co-founder and CEO of the Coalition for Green Capital. Hundt has been advocating for green banks for over a decade — including seven years on the board of the Connecticut Green Bank — and it is largely through the coalition’s work that the network of state and local green banks has been established.I was eager to talk with Hundt about how a national green bank would work, the kinds of projects it would fund, how it would account for equity, and the potential if it’s done right, for a green bank to accelerate the clean energy transition. Reed Hundt, welcome to Volts, thank you for coming.Reed Hundt:Thank you very much. I was talking to a friend of mine in Tennessee and he told me that you're from Tennessee. He said that you were the best analyst and commentator about energy issues in the whole state of Tennessee.David Roberts:I don't know whether that's damning by faint praise?Reed Hundt:Well then I said to my friend, “No, no, the two of you are,” because the person I was talking to was my high school classmate Al Gore.David Roberts:Oh, funny! Yes, he and I have bonded over our Tennessee roots before. I want to talk about green banks with you, but real quick, by way of setting context before that, let’s talk history. Obama faced a similar situation [to the one Biden faces] — different in a lot of ways, similar in some ways. But you wrote a book about Obama's response to the crises he faced that was extremely critical of Obama. So as we contemplate what Biden should be doing in this similar situation, let's review real quickly, what did Obama do wrong and what does that tell us about how Biden should be approaching this mess?Reed Hundt:You're in a very small