Investment in Alternative Energy After the End of Cash Grants

The cash grant program for renewable energy expires at the end of this year. When cash grants end, renewable energy projects will once again rely on 'tax equity investors' to offer lower-cost financing in exchange for the tax credits and accelerated depreciation that are available to investments in renewable energy. Will lenders and investors continue to drive growth in the renewable energy sector after the cash grant program expires? Tax equity investing has been the bedrock of renewable power development for a decade. Although the economy continues to face rough times, there are investors with sufficient tax liability to benefit from renewable tax credits and depreciation, without cash grants. While financial institutions have traditionally been the predominant tax equity investors, there also are new, significant investors in the renewable tax equity market that could continue to support renewable projects and infrastructure development in the United States.

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