Citigroup Inc. plans to lend, invest and facilitate deals worth $100 billion by 2025 to support projects that will fight climate change and protect the environment.
Citigroup expects the effort to lead to deals supporting renewable power, energy efficiency and sustainable transportation opportunities, Chief Executive Officer Michael Corbat said in a speech in New York Wednesday
The effort builds on an earlier goal to arrange $50 billion in deals that the bank set for itself in 2007 and achieved in 2013, three years ahead of schedule. Citigroup’s new target puts it well ahead of other financial companies, including Bank of America Corp., which said in 2012 it would support $50 billion in deals for low-carbon initiatives, and Goldman Sachs Group Inc., which announced a $40 billion program the same year.
“Simply put, it is a $100 billion investment in sustainable growth,” Corbat said. “These efforts do not constitute philanthropy, nor do they represent costs. In fact, they reduce costs.”
Putting together renewable-energy deals is becoming easier as the technology becomes more mainstream, Marshal Salant, Citigroup’s head of alternative energy finance, said Wednesday.
“We can do literally a billion-dollar solar or wind bond and have dozens of investors go in and participate,” Salant said in an interview. “Five years ago, if you came to me and said, ‘Can we do a billion dollars?’ I’d say, ‘I don’t know, it’s never been done before.’ ”
Citigroup helped arrange financing for the $2.74 billion Solar Star projects in California. SunPower Corp. is building the two solar farms for Warren Buffett’s MidAmerican Energy Holdings Co. They’re expected to have a total of 579 megawatts of capacity when completed this year.
“We need the largest financial players in the world to engage in the climate debate as an economic imperative,” Mindy Lubber, president of the sustainability nonprofit group Ceres, which helped Citigroup develop its strategy, said in an interview.
“I think it’s big enough to make a difference in jumpstarting certain parts of the renewable energy economy and moving green infrastructure forward.”