On May 27, 2020, the US Internal Revenue Service (the “IRS”) released Notice 2020-41 (the “Notice”), updating the IRS guidance on the start-of-construction rules for the production tax credit (“PTC”) and energy investment tax credit (“ITC”) by extending the continuity safe harbor for projects that began construction in either calendar year 2016 or 2017.1 Additionally, the Notice provides relief under the so-called 3 ½ month rule where payments were made on or after September 16, 2019, but the services or property were not expected to be provided until 2020, as long as they are actually received by October 15, 2020.

Continue Reading IRS Provides Start-of-Construction Relief for Renewables in Light of COVID-19

The U.S. Department of Treasury plans to modify the rules regarding the continuity safe harbor for the start-of-construction rules under Treasury guidance for the production tax credit (PTC) and energy investment tax credit (ITC).  This plan was announced today, May 7, 2020, in a letter from Frederick W. Vaughan, Principal Deputy Assistant Secretary, Office of

On June 6, 2019, the US Internal Revenue Service (IRS) published a notice providing the inflation-adjustment factors and reference prices for the calculation of renewable electricity production tax credits (PTCs) under Internal Revenue Code (IRC) section 45 for 2019.

The notice provides that the PTC for electricity produced from wind, as well as closed-loop biomass and geothermal energy, increased from 2.4 cents per kilowatt-hour (kWh) to 2.5 cents per kWh for 2019. The notice also includes the PTC amounts for electricity produced from other qualified energy resources. Specifically, the PTC for electricity produced from open-loop biomass, landfill gas, trash, qualified hydropower, and marine and hydrokinetic resources remains at 1.2 cents per kWh for 2019. The PTC for refined coal also increased from $7.03 per ton to $7.173 for 2019.
Continue Reading IRS Releases 2019 Section 45 Production Tax Credit Amounts

Below are soundbites from panelists who spoke at Infocast’s Wind Finance & Investment Summit on February 6 and 7 in Carlsbad, CA.  The attendance at the event appeared strong, and the mood was generally optimistic.

Despite the title of the conference being wind, many of the panelists touched on solar and storage, so readers who do not work in the wind industry may nonetheless find some points of interest below.

The soundbites are edited for clarity and are organized by topic, rather than in chronological order.  They were prepared without the benefit of a transcript or recording.

Topics covered below include the tax equity market, the 2020 soft deadline for the full production tax credit (“PTC”), the impact of the PTC phase out, PG&E’s bankruptcy, storage and more.

State of the Tax Equity Market

“There was $12 billion of combined wind and solar tax equity investment in 2018.  This up from $10 billion of tax equity investment in 2017; however, the actual new volume was down in 2018 as $3 billion of the $12 billion in 2018 was secondary market transactions” (i.e., one tax equity investor selling down to another tax equity investor).  Managing Director, Money Center Bank

“Tax equity has done well in terms of how it has worked out for the banks that invested in it.”  Tax Equity Head, Corporate Investor
Continue Reading Infocast’s Wind Finance & Investment Summit Soundbites

Here’s a presentation that Joseph Sebik, CPA of Siemens Financial Services and I gave to the Energy Subcommittee of the Equipment Leasing and Finance Association on January 22: Tax Equity Energy Subcommittee 1-22-19 of ELFA.

Despite being to a leasing trade association, the focus of the presentation is the partnership flip structure.  The presentation

I am pleased to announce that I will be speaking in an upcoming Strafford live webinar, “Tax Reform and Renewable Energy: Planning Techniques, 100% Expensing, BEAT, Tax Credits and Interest Deduction Limitations” scheduled for Wednesday, January 16, 1:00 pm-2:30 pm Eastern.

As a reader of this blog, you are eligible to attend this

Below are answers to questions we received during our tax equity webinar of October 23.  These questions were submitted online during the webinar.  The presentation from the webinar is available here.

Question: Commercial and industrial (C&I) has higher returns but how many projects raise tax equity versus other segments of the solar market? What

We were pleased to participate in Power Finance & Risk’s (PFR) Tax Equity Roundtable.  We were joined in the roundtable discussion by Rich Dovere of C2 Energy Capital, Marshal Salant of Citi, Kathyrn Rasmussen of Capital Dynamics Clean Energy and Infrastructure, Pedro Almeida of EDP Renewables North America and as moderator PFR’s editor, Richard Metcalf.