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Renewable Energy Financing: Critical Considerations and Key Strategies

Delve into the anatomy of financing renewable energy projects with insights on market generation, tax incentives, procurement methods, due diligence, and essential project components. Explore potential challenges and complexities to streamline successful project execution.

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Renewable Energy Financing: Critical Considerations and Key Strategies

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  1. ANATOMY OF A DEAL: FINANCING Peter Y. Flynn, Bostonia Partners

  2. Critical Issues • Economics • Generation market • Renewable Portfolio Standard • Federal and state tax incentives • Procurement method: long-term contracting authority is key • Due diligence and pre-procurement work by the Service • Project size and technologies sought • Essentiality of the installation • Track record of the Service and installation • Project “champion” • Team must include members with experience and financial strength

  3. Additional Considerations • Potential Issues & Challenges • PPA pricing • Termination for convenience • Recapture during tax benefit period • RECs • Insolation and shading • Potential Complexities • Site control • Relocation • Roof Replacement • Novation/assignment • Procurement method • OMB scoring • State utility laws • Additional Value • Renewable Energy Credits (RECs) – ownership, price, and value • Energy Security

  4. Renewable Energy Financing Structure -ESPC Solar Facility and ECMs ESCO GOVERNMENT IDIQ Contract Task Order for ECMs Energy Services Agreement Construction Funds RESA and ECM Payments O&M Agreement Installation Agreement BOSTONIA (Owner / SPE) RESA / Task Order Assignment TRUSTEE Tax Benefits Tax Equity Ownership

  5. PPA Financing Structure GOVERNMENT Solar generated electricity Electricity Payments Solar Developer Purchase Price Project Company (Solar Facility Owner) Installation O&M Contract Guarantees PPA Revenue & Tax Benefits Tax Equity Debt Project Equity

  6. EUL Financing Structure GOV’T COMMERCIAL OFF-TAKE EPC Power Sales DEVELOPER / SPE PPA Payments Ground Lease FUEL Power Sales O&M FINANCIER TRUSTEE Debt Service LENDER [TAX] EQUITY

  7. Contact Information Peter Y. Flynn Executive Vice President 617-226-8103 Direct 617-437-0150 Main pflynn@bostonia.com

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