Nonprofit Plans Green Power Investment Notes

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BOSTON, Mass. -- Nonprofit New Generation Energy wants to help renewable energy projects get off the ground with capital raised by socially conscious consumers, businesses and foundations.

Boston-based NGE hopes to raise $50 million through 2012. They plan to pool the money and offer it to renewable energy projects in the form of low-interest loans. In exchange, investors will receive a fixed rate of return for a seven-year term.

"We've had a lot of interest from people wanting to buy these notes," said Karla Franco, NGE's associate director.

It works like this: investors buy a Renewable Energy Investment Note (REIN) from the organization for between $1,000 and $1 million each. NGE uses the capital to make low-interest loans in the 3 percent range to community-scale green power projects, including solar, wind, geothermal and biomass; energy efficiency projects could also receive funding.

NGE plans to select low-risk renewable energy projects. "We're focusing on rock-solid clients," Franco said, adding that the organization will initially consider making loans to other lenders, such as community banks.

Proceeds from the renewable energy projects will repay investors and financially support NGE. The model is similar to the Calvert Foundation's, which makes investments into underserved communities.

NGE's program will first launch in the New England and New York in 2009, with plans to expand nationally in 2010.

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