Recent government incentives have made renewable energy projects the most popular investments currently financed using tax equity structures. The largest renewable sectors are wind and solar power, followed by biomass and geothermal. The range of structure types includes partnerships, leases, and inverted leases. Each of these types uses one or more of the available government incentives: Treasury cash grant, investment tax credit, production tax credit, DOE loans, and bonus depreciation.
Examples of renewable projects structured using ABC include:
- Large wind farms
- Utility-scale solar farms, including CSP and PV
- Commercial rooftop projects and distributed generation
- Residential rooftop installations
Large- and medium-sized renewable projects are commonly financed with traditional lease structures and special allocation partnerships. As the debt markets recover, our clients have incorporated leverage into many of the large projects to enhance the economics for the project participants. Portfolios of residential solar installations have been financed with inverted leases.