U.S. municipal bonds could fund renewable energy

WASHINGTON (Reuters) - The $2 trillion U.S. municipal bond market can be a meaningful source of financing for biofuel production and delivery as well as the development of new renewable energy technologies, a top Department of Energy official said on Wednesday.

"I am keen to understand how that market can be better cultivated for new technologies, not just biofuels," said Department of Energy assistant secretary Andy Karsner, speaking at the Reuters Global Biofuel Summit.

Karsner, who heads the energy efficiency and renewable energy division, said he and his officials plan to attend next week's Conference of Mayors' meeting in Washington, D.C., to discuss the use of municipal bonds to fund renewable energy initiatives.

"It's only really recently, one could say in the course of this administration, that the (capital) markets have reached into the pipeline with demand pull," Karsner said of growing investment flows to renewable energy projects.