Renewable Energy Tax Credits News Briefs - January 2017

Tuesday, January 10, 2017

The U.S. Court of Federal Claims awarded more than $206 million Oct. 24, 2016, to cash grant applicants for the Alta Wind project that the U.S. Treasury Department declined to pay under Section 1603 of the American Recovery and Reinvestment Act (ARRA). The lawsuit alleged that Treasury awarded smaller cash grants than the plaintiffs sought for the 1.55 gigawatt (GW) development in the Mojave Desert of California, because Treasury based the award on the construction price rather than the purchase price for the plaintiffs. The Department of Justice can appeal the case to the federal court. The decision is available at www.energytaxcredits.com. 

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Standard & Poor (S&P) released Nov. 22, 2016, the new Ratings Direct Report, “Trump & Energy: The Credit Implications of the 2016 Election.” The report explores the possible effects of a Trump presidency on domestic energy regulation, renewables investment and long-term credit quality across a variety of energy and infrastructure related sectors. The report discusses the possible futures of coal, fracking, the Keystone Pipeline, ethanol, the Clean Power Plan and The Paris Agreement, nuclear generators and tax credits–specifically the investment tax credit (ITC) and production tax credit (PTC). S&P said that there is likely going to be dwindling incentives for renewable production as tax credits roll off from 2019. Unless the tax credits are renewed, renewable producers will face increased challenges and while the ITC, PTC and unmet state renewable portfolio standards should propel the building of wind and solar assets, a Trump presidency could spell challenges for renewable developers. S&P closed out the report by stating that as the Trump presidency unfolds in 2017, the company will begin to assess what impacts, if any, his administration will have on energy industry credit quality and how those may differ from those brought about by President Barack Obama’s policies.

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On Nov. 22, 2016, the Energy Transition Lab, University of Minnesota released the report, “Minnesota Clean Energy: Economic Impacts & Policy Drivers; How State and Federal Policies are Converging to Drive Clean Energy Investment in Minnesota.” Wind Energy Foundation and A Renewable America prepared the report, which focuses on the ways that industry policies and the federal PTC and ITC have already had an impact on Minnesota’s economy and how their extension will continue to provide benefits for businesses and residents of the state. The report emphasizes several key items. Utility scale investments in wind and solar have increased since extension of the PTC. The distributed generation of solar energy has almost doubled in the past two years, with businesses citing the ITC as a major driver in their success. The development of the existing wind and solar projects would result in approximately $7.09 billion in direct investment, more than 5,000 jobs related to construction alone and 3,987 megawatts of newly installed capacity. Also noted is that Minnesota’s clean energy economy has grown by more than 7,000 jobs since 2000. The report is available at www.energytransition.umn.edu.

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Amazon Web Services Inc. (AWS) announced Nov. 17, 2016, five new Virginia solar farms that will bring 180 megawatts (MW) of renewable energy capacity before the end of 2017. Amazon Solar Farm U.S. East 2 in New Kent County, Amazon Solar Farm U.S. East 3 in Buckingham County, Amazon Solar Farm U.S. East 4 in Sussex County and Amazon Solar Farm U.S. East 5 in Powhatan County are four individual facilities, each with a 20MW capacity. Amazon Solar Farm US East 6 is a 100MW facility in Southampton County. All five of these facilities join Amazon Solar Farm US East, an 80MW facility already in production in Accomack County. Combined, the six solar farms are expected to generate more than 580,000 megawatt hours (MWh) of energy annually. Virginia Solar LLC and Community Energy Solar were the developers on the projects and AWS will collaborate with an affiliate of Dominion Resources Inc. to own and operate the solar farms long term. 

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