Renewable Energy Project Structuring Under the Inflation Reduction Act (IRA)

January 30-31, 2024 | Denver, CO :: Mountain Time

0124-renewable-project-structuring

“Very informative and a go-to presentation for renewable energy tax structuring.” Member, Moore & Van Allen PLLC

“The course content is quite useful as it’s on the point and covered all the relevant topics. The speakers did a wonderful job – touching on the basics as needed and delving deep as it progressed. Highly recommend it!” Associate Vice President, Project Finance Advisory Limited

“A course with enough detail and complexity for subject matter experts, but also clear enough for folks new to the issues.” Vice President and Corporate Counsel, Sky Renewable Energy Ltd.

“Great to get the newest IRA tax notifications and rulings as they are hot off the press!” Co-owner, D2 Solar LLC

Renewable energy project tax incentives are vital in any renewable energy (including storage) transaction and – thanks to the Inflation Reduction Act (IRA) – utilities, munis, coops, non-profits, and other power-serving organizations also now have access to the renewable energy development and asset ownership landscape.

This course is designed to give renewable energy investors, developers, lenders, asset owners, utilities, and their advisers an in-depth understanding of the tax issues and financial issues involved in the development and structuring of projects.  It will examine in detail how the IRA, other infrastructure legislation passed in 2022, and related IRS guidance have re-shaped tax structuring for renewable energy and storage projects.

Learning Outcomes

The course content will:  

• Review the existing incentives for renewable energy and discuss how the tax incentives for renewables investment has been influenced by the Biden administration and current Congress 
• Discuss in depth the various rules for partnerships and leasing structures 
• Explain how to optimize the financial accounting aspects of renewables 
• Describe the use of energy and low-income community tax credits 
• Review case studies using economic modeling analysis  
• Discuss with experienced developers, lenders and investors the issues they confront in their projects 
• Examine how to present financial documents to achieve the greatest “bankability”

Tuesday, January 30, 2024 : Mountain Time

 

9:00 – 9:15 a.m. :: Overview and Introductions

9:15 – 10:45 a.m. :: Survey of Inflation Reduction Act (IRA) “Game-Changers”

• Direct Pay
• Transfer or sale of tax credits (Transferability)
• Energy Community bonus
• Domestic Content bonus
• PTC for solar bonus
• ITC storage eligibility bonus
• Prevailing wage and apprenticeships bonus

Survey of Tax Incentive Transaction Instruments

• Partnership flip
• Sale leaseback
• Lease pass-through (aka inverted lease)

Transaction Parties and Their Roles

• Sponsor/ Project Developer / Utility
• Lender
• Tax equity investor

Overview of Tax Incentives for Renewable Energy

• Primary tax incentives
  • Production Tax Credit (PTC) – Section 45 / sales of electricity to third parties
  • Investment Tax Credit (ITC) – Section 48 / facility cost basis
  • Accelerated Depreciation
• The role of partnerships and LLCs
• Significance of “begun construction” and getting projects started
• Overview of modifications introduced by IRA
• Extensions of ITC and PTC
• New credits
• Add-ons to the credit rates
• Ability to sell tax credits or receive direct cash payments in lieu of tax credits

James Duffy, Partner & Chair – Renewable Energy Tax Credit Team, Nixon Peabody LLP

Tony Grappone, Partner, Novogradac & Co LLP

10:45 – 11:00 a.m. :: Morning Break

11:00 a.m. – 12:30 p.m. :: Details of New Provisions Under the Inflation Reduction Act (IRA)

• Extension of ITCs and PTCs
• Prevailing wage and apprenticeships and the 5X multiplier
• Add-ons for domestic content, energy communities, environmental justice (low income)
• Availability of credits for hydrogen, carbon sequestration, storage
• New carbon neutral ITC and PTC starting in 2025
• New reasons to pay attention to “begun construction”
• Sales of Credits (“Transferability”)
• “Direct Pay” for tax-exempts, tribes, and governments

Forrest Milder, Partner, Nixon Peabody LLP

Tony Grappone, Partner, Novogradac & Co LLP

12:30 – 1:30 p.m. :: Group Luncheon

1:30 – 2:00 p.m. :: Examining the Transaction Structures Applicable under IRA

• Partnership flip
• Sale leaseback
• Lease pass-through (aka inverted lease)

James Duffy, Partner & Chair – Renewable Energy Tax Credit Team, Nixon Peabody LLP

Tony Grappone, Partner, Novogradac & Co LLP

2:00 – 2:30 p.m. :: Tax Elements and Characteristics Applicable under IRA

• Partnerships, LLCs and the pass-through of tax benefits
• Allocations of income, loss, tax credits vs. distributions of income, Capital Accounts and DROs
• Partner in a partnership, economic substance & profit motive

Forrest Milder, Partner, Nixon Peabody LLP

2:30 – 2:45 p.m. :: Afternoon Break

2:45 – 4:45 p.m. :: Financial Models Applicable under IRA

• Overview and role of financial models
• Setting the inputs
• Specific attention to the “Flip” model Investment Tax Credit (ITC)

James Duffy, Partner & Chair – Renewable Energy Tax Credit Team, Nixon Peabody LLP

Tony Grappone, Partner, Novogradac & Co LLP

4:45 p.m. :: Program Adjourns for Day

 

Wednesday, January 31, 2024 : Mountain Time

9:00 – 10:00 a.m. :: Financial Models Applicable Under IRA (continued)

• Specific attention to the “Flip” model Production Tax Credit (PTC)

James Duffy, Partner & Chair – Renewable Energy Tax Credit Team, Nixon Peabody LLP

Tony Grappone, Partner, Novogradac & Co LLP

10:00 – 10:45 a.m. :: Tax Issues in Greater Detail Applicable under IRA

• Preserving tax credit eligibility and commencing construction
• Physical work of a significant nature
• 5% Safe Harbor
• Comparing individual and corporate investors
  • Passive activity rules
  • At-risk rules
  • Suspended losses, carry-forwards and carry-backs
• Participation of tax-exempt entities
  • PPAs vs. leases
  • When can they acquire ownership
  • Effects of the direct pay provisions of the IRA

Forrest Milder, Partner, Nixon Peabody LLP

10:45 – 11:00 a.m. :: Morning Break

11:00 a.m. – 12:30 p.m. :: Tax Issues in Greater Detail Applicable Under IRA

(Continued)

• Battery Storage
  • Comparing storage as part of a project with “stand-alone”
• Repowering projects
  • Used vs. new property analysis
  • IRS guidance
• State and local tax issues
  • Property tax exemptions
  • Non-resident withholding
• Partnership allocations safe harbors
• Deficit restoration obligations (DROs)
• Exit Strategies
  • Options, calls, puts
  • What is fair market value and why does it matter
  • Income character (long term gain vs. ordinary income)

Forrest Milder, Partner, Nixon Peabody LLP

12:30 – 1:15 p.m. :: Group Luncheon

1:15 – 2:15 p.m. :: Financial Models Applicable under IRA

(Continued)

• Detailed review of typical lease pass-through financial model

James Duffy, Partner & Chair – Renewable Energy Tax Credit Team, Nixon Peabody LLP

Tony Grappone, Partner, Novogradac & Co LLP

2:15 – 3:00 p.m. :: Lender – Investor Engagement Interparty Agreements Applicable under IRA

• Partnership flip parties’ transaction positions
• Inverted lease parties’ transaction positions
• What every tax credit investor wants to avoid
• Lender recourse remedies
• Loan Guarantees
• Interparty agreements between lender and tax equity

Michael Kuhn, Senior Vice President – Corporate Banking, Cambridge Savings Bank

James Duffy, Partner & Chair – Renewable Energy Tax Credit Team, Nixon Peabody LLP

3:00 – 3:15 p.m. :: Afternoon Break

3:15 – 4:45 p.m. :: Tax Equity “Best Practices” Panel for Optimizing incentives under IRA / Open Forum

The roundtable-format panel will focus on the practical problems confronted by developers and other industry participants in maximizing the efficiency of monetizing tax incentives in structuring and financing renewable energy projects.  It will also discuss aspects of how to assemble a team of deal experts.  And the SMEs will consider externalities influencing the tax equity landscape, such as supply chain challenges, inflation impacts, contract re-negotiations and the like.

4:45 p.m. :: Program Adjournment

James F. Duffy is a partner in the Boston office of the national law firm, Nixon Peabody LLP.  He serves as the Co-Chair of the firm’s Renewable Energy Tax Credit Team and concentrates his practice on structuring and closing transactions involving federal income tax credits and other significant federal and state income tax incentives, including Production Tax Credits and Investment Tax Credits for renewable energy.  His practice also covers New Markets Tax Credits.  He has represented numerous developers, investors, syndicators and lenders in structuring and closing renewable energy and other transactions.  He serves on the Board of Directors and is the Secretary of the Distributed Wind Energy Association (DWEA), as well as the Board of Directors of Windustry.  He is a graduate of the University of Rhode Island, B.A. and The Harvard Law School, J.D.

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Rod Eckhart is Managing Director for Renewable Energy at Seminole Financial Services.  He joined the Companies full time 2021 after having led Seminole Equity Partners for the previous seven years. In a career spanning more than two decades, Mr. Eckhardt has worked extensively with tax incented investments including renewable energy and real estate from both an equity and debt perspective. His experience includes fund management, origination, and syndication of investments representing more than $2 billion.  He has worked on behalf of tax credit syndicators, lenders, investors, developers and the United States Department of Energy. Mr. Eckhardt previously served as Vice President for Capmark Finance Inc. and as Investment Counsel for a division of GMAC. He earned his B.A. from Colorado State University and his J.D. from Gonzaga School of Law.

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Tony Grappone is a partner in the Boston office of Novogradac & Company LLP, where he specializes in providing accounting, tax and consulting services to developers, syndicators and investors of projects that qualify for federal and state tax credits such as renewable energy tax credits.  He serves as a technical editor of the firm’s Renewable Energy Tax Credit Handbook.  Prior to joining Novogradac & Company LLP, Mr. Grappone worked at Ernst & Young LLP specializing in partnership taxation within the affordable housing industry and servicing many of the nation’s largest tax credit syndicators and investors.  In addition, he served several leading venture capital firms as well as commercial real estate developers and investors.  He earned a bachelor’s degree from Northeastern University in Boston, Mass.

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Michael Kuhn is Senior Vice President and Team Leader in Commercial Lending at Cambridge Savings Bank.  In that role, he facilitates the bank’s position in the solar financing market. Mr. Kuhn has been with Cambridge Savings for some 15 years and previously worked for Rockland Trust Company as well as the Federal Reserve Bank of Philadelphia.

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Forrest David Milder is a partner in the Boston office of Nixon Peabody LLP.  He has more than 30 years’ experience in the tax aspects of project finance, particularly renewable energy (including solar, wind, geothermal, and biofuels), housing, historic rehabilitations, and new markets, as well as many other related fields, including partnerships and limited liability companies; tax-exempt organizations and unrelated business income; business formation, operation, and disposition; qualified opportunity funds and deal structures.  Mr. Milder is the author of more than 80 published articles on tax advantaged investments, and he has appeared many times on the front page of The Wall Street Journal (in the weekly Tax Report column), as well as in Bloomberg, and many other publications with comments on tax legislation.  He received his SB (Phi Beta Kappa) and SM from MIT, his JD from Harvard Law School, and a masters in taxation from Boston University School of Law. 

REGISTER NOW FOR THIS EVENT:

Renewable Energy Project Structuring Under the Inflation Reduction Act (IRA)

January 30-31, 2024 | Denver, CO

Buy 4 in-person seats and only pay for 3! For this event every fourth in-person attendee is free!

Your registration may be transferred to a member of your organization up to 24 hours in advance of the event. Cancellations must be received on or before December 29, 2023 in order to be refunded and will be subject to a US $195.00 processing fee per registrant. No refunds will be made after this date. Cancellations received after this date will create a credit of the tuition (less processing fee) good toward any other EUCI event. This credit will be good for six months from the cancellation date. In the event of non-attendance, all registration fees will be forfeited. In case of conference cancellation, EUCIs liability is limited to refund of the event registration fee only. For more information regarding administrative policies, such as complaints and refunds, please contact our offices at 303-770-8800

EUCI is accredited by the International Accreditors for Continuing Education and Training (IACET) and offers IACET CEUs for its learning events that comply with the ANSI/IACET Continuing Education and Training Standard. IACET is recognized internationally as a standard development organization and accrediting body that promotes quality of continuing education and training.

EUCI is authorized by IACET to offer 1.3 CEUs for this event.

Instructional Methods

PowerPoint presentations and case studies will be used in program.

Requirements For Successful Completion Of Program

You must be logged in for the entire presentation and send in the evaluation after the online course is completed.

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Upon successful completion of this event, program participants interested in receiving CPE credits will receive a certificate of completion.

Course CPE Credits: 15.0
There is no prerequisite for this Course.
Program field of study: Specialized Knowledge
Program Level: Basic
Delivery Method: Group Internet Based
Advanced Preparation: None

EUCI is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its web site: www.nasbaregistry.org

 

Who Should Attend

• Solar, wind and other renewable energy project developers
• Merchant and independent power producers
• Tax and consulting firms associated with renewable energy development
• Lenders and related financial groups associated with in renewable projects
• Investors in renewable energy projects
• Utilities and asset owners
• Legal professionals associated with renewable energy development
• Risk professionals associated with renewable energy development
• Project managers associated with renewable energy development