ACORE Finance Forum Looks Ahead to Post-COVID Renewable Energy Transaction Landscape

In this exciting minute for the renewable energy sector, the American Council on Renewable Energy (ACORE) happily hosted the ACORE Finance Forum on June 15-16. Participated in virtually by over 330 participants, the Finance Forum assembled professionals from across the sustainable energy market, including the sectors biggest and most influential investors, designers, energies, purchasers, makers, and consultants to provide their insights on the next stage of sustainable energy financing and financial investment in the consequences of the international pandemic.
There was broad agreement on the need for a whole-of-government approach to accelerate the clean energy shift, and an acknowledgment that steady, long-term tax policies were among the most efficient policy tools readily available to increase renewable energy deployment. Speakers went over possible extensions of existing tax credits for sustainable energy generation, as well as propositions for new standalone credits for energy storage and high-voltage transmission. ACORE Finance Forum speakers discussed how this influx of capital is benefiting the renewable energy sector.

By Maheen Ahmad and Blake McCarrenJuly 1, 2021
As the new administration launches enthusiastic plans to confront the climate crisis, corporate sustainability efforts are rising to scale up financial investment in our clean energy future. In this amazing minute for the sustainable energy sector, the American Council on Renewable Energy (ACORE) proudly hosted the ACORE Finance Forum on June 15-16. Participated in essentially by over 330 participants, the Finance Forum assembled professionals from across the eco-friendly energy market, consisting of the sectors biggest and most influential investors, designers, utilities, purchasers, manufacturers, and consultants to provide their insights on the next phase of sustainable energy financing and financial investment in the after-effects of the international pandemic.
Federal Policy, Tax Credit Extensions and “Building Back Better”
The 2021 ACORE Finance Forum was set against the background of continuous settlements on a massive federal infrastructure package. President Biden followed up his project path pledge to “Build Back Better” by launching the American Jobs Plan, a proposal meant to capitalize on a once-in-a-generation chance to fix our nations falling apart facilities while enacting extensive, science-driven climate and clean energy policies. The conference included panelists from the White House, U.S. House of Representatives, and U.S. Senate as the federal agenda for clean energy and climate takes shape. There was broad contract on the need for a whole-of-government method to speed up the clean energy shift, and an acknowledgment that stable, long-lasting tax policies were amongst the most reliable policy tools readily available to increase renewable energy implementation. Policymakers plainly see this year as a huge opportunity to make transformative financial investments in our facilities in reaction to the looming hazard of environment change. Speakers went over possible extensions of existing tax credits for eco-friendly energy generation, in addition to proposals for brand-new standalone credits for energy storage and high-voltage transmission. There was likewise a productive conversation about methods to ensure that the benefits of tidy energy rewards are felt by all Americans, especially those in disadvantaged communities.
Capital Flows
The ACORE Finance Forum brought leading investors and project sponsors together to talk about offer circulation, tax equity, and the cost of capital in this significant moment for sustainable energy financial investment. Beginning the conversation, ACOREs brand-new $1T 2030 report, Expectations for Renewable Energy Finance in 2021-2024, found that financier confidence in the renewable resource and energy storage sectors is at an all-time high.
Investors and sponsors were usually in contract that the tax equity market has enhanced after a difficult year in 2020. However, persistent problems securing tax equity financing have actually resulted in task hold-ups, while some smaller sized projects have had troubles getting financing altogether. Investors stressed the significance of direct pay in absorbing the stockpile need for tax equity and reducing the requirement for a third-party tax equity investor in job deals.
A group of financial investment lenders kept in mind a boost in debt financing in the majority of renewable technology sectors, especially in energy storage and property solar. Several lenders mentioned they expect development in dispersed generation as a way of meeting state-level renewable energy targets.
The previous year has actually likewise brought new financing chances to climate technologies beyond wind and solar– such as e-mobility, hydrogen, eco-friendly gas and energy storage– through Special Purpose Acquisition Companies (SPACs) and other ingenious public and private business financing arrangements. Capital flows in this space are expected to increase considerably with efforts to attain deeper decarbonization circumstances.
Motivated Private Capital: ESG Investing and the Just Transition
This upward pattern in Environmental, Social and Governance (ESG) financial investment is driven by both investor and business interest, with financial organizations intending to divest from fossil fuels and corporations increasingly setting climate targets. ACORE Finance Forum speakers talked about how this increase of capital is benefiting the renewable energy sector.
In addition to climate-centered metrics, panelists likewise highlighted the value of human-centered metrics in ESG investment, such as variety and addition, the social effects of sustainable energy deployment, and supply chain labor practices.
Banks and members of ACOREs Accelerate membership program discussed approaches for protecting fair access to capital as part of a simply transition to a tidy energy economy. Individuals highlighted that a just transition includes renewable resource deployment that is both driven by, and useful to, local neighborhoods. Speakers examined how banks could determine significant financial investments and broaden the diversity of their networks. They likewise addressed how citizens in disadvantaged locations can own such jobs and lead regional labor force training. The hope is that the wealth created from such jobs will stream back to these neighborhoods.
Grid Resilience and the Role of Hedges after ERCOTs Winter Crisis
The ACORE Finance Forum featured viewpoints on the potential effects of the Texas power blackouts in February on funding projects and the urgent need for facilities enhancements. Panelists concentrated on the need for weatherization, a buildout of interregional transmission, and the implementation of a varied mix of tidy energy resources as long-term options for enhancing grid resilience.
Speakers also went over the impact of the Texas blackouts on hedge plans in ERCOT and other markets. They discussed how the sector is adjusting to difficulties for business virtual power purchase contracts and merchant renewables, and some investors commented that they are prioritizing other funding structures in place of fixed-shape hedges. Panelists likewise required reforming danger evaluations to account for circumstances in which power is not being produced.
Keynote Discussions with Policymakers
ACORE Finance Forum attendees heard from keynote speaker Jigar Shah, who serves as the Executive Director of the U.S. Department of Energys Loan Programs Office. Shah had an useful conversation with ACORE President and CEO Gregory Wetstone about the need for stakeholders across the eco-friendly energy landscape to refocus on transmission growth and prioritize tasks that can be developed relatively rapidly along existing rights of way.
Jigar Shah, Executive Director of DOE Loan Programs Office, ACORE Finance Forum
Chairman Glick spoke at length about the heightened focus on transmission growth to unlock more renewable resources as FERC prepares to unveil a “roadmap” for transmission later this year. The conversation likewise covered energy storage jobs, carbon pricing and grid improving technologies.
Richard Glick, FERC Chairman, ACORE Finance Forum.
On behalf of the whole ACORE team, thank you to all who were able to attend the 2021 ACORE Finance Forum. Those who registered for the conference however did not get a possibility to participate in all of the sessions can watch the program on our conference hub up until July 16. Those who missed out on the possibility to register and want to access the content can connect to events@acore.org to ask about acquiring a post-event pass.