Includes bibliographical references and index.

"This book explains how environmental projects and improvements are achieved through the imposition of regulations, on the one hand, and financial incentives on the other. It discusses how those incentives can be organized to achieve the greatest environmental benefits at the lowest possible cost to the public. The book presents the best environmental finance policies to bear on the financing of alternative energy projects so that the ultimate cost of delivered power will decline. It also examines the challenges of the next generation of environmental programs"-- "Preface This is not your average textbook. It is not a compilation of dry facts and drier theories. I started looking into environmental finance issues about 25 years ago. In many cases, I was appalled at what I saw. This book is a reflection of those experiences. I come from Wall Street. I have seen how business deals with financial issues. Financial markets are highly efficient. Government has much to learn. Before Wall Street, I was in politics in New York State. Winston Churchill said, "Democracy is the worst form of government, except for all others that have been tried." He also said, "The best argument against democracy is a five-minute conversation with the average voter." I am not so cynical, but I do see clearly that the exigencies of politics temper all good-hearted attempts to bring business-like efficiencies to environmental finance. I understand why a state legislator would vote for a grant program, even when it is wasteful and foolhardy to do so. I sympathize with them; but that is not going to stop my pointing out the folly of their actions. When colleagues asked me the working title of the book I was writing, I, of course, told them, "Finance Policy for Renewable Energy and a Sustainable Environment." Their next question invariably was, "When did you start writing fiction?" Their point is well taken. There is no finance policy for renewable energy. And, there is no finance policy for a sustainable environment. When I teach Environmental Finance, I often facetiously tell my class that they are listening to the world's greatest expert in environmental finance ... under one theory that, in the land of the blind, the one-eyed man is king! This point is also well taken. I have been practicing what I call "environmental finance" for the past 25 years"-- 1. Paying for the fix -- 2. The 23 principles of environmental finance -- 3. Two core principles of environmental finance -- 4. Policy principles of environmental finance -- 5. Management principles of environmental finance -- 6. Revenue raising principles for environmental finance -- 7. Sources of revenue for environmental finance programs -- 8. Financial principles of environmental finance -- 9. Financial mechanics -- 10. Comparing financing alternatives -- 11. Hidden and not-so-hidden cost factors -- 12. Impact of term on annual debt service payment -- 13. Grants and affordability -- 14. The role of equity -- 15. The curse of subsidies -- 16. Leverage : the power of guaranties -- 17. Cost/benefit analyses -- 18. Credit enhancement -- 19. Tariffs -- 20. Climate change and renewable energy -- 21. Cap-and-trade programs -- 22. Driving down costs.