Renewable Energy Developments: Grants

Renewable Energy Developments: Grants

American Bar Association Section of Public Utility and Renewable Energy Committee   By American Bar Association Section of Public Utility and Renewable Energy Committee

This Emerging Issues Analysis from the American Bar Association's Renewable Energy Committee looks at state and local loan programs for clean energy programs.

Despite broad and growing interest in clean energy in the U.S., funding ‑‑ especially borrowing to finance clean energy investment ‑‑ remains difficult, if not impossible, to secure. While federal loan guarantees have attracted a great deal of attention and can be a valuable tool for securing or subsidizing large loan commitments, most installers, consumers and even smaller developers cannot make use of these programs, which are competitive, expensive and targeted at projects with capital needs of more than $25 to $30 million.

For projects between $1 million and $25 million, it is often possible to structure debt financing based on the project's fundamentals. However, smaller projects such as smaller roof-top solar arrays or geothermal heat pumps can be extremely difficult to get financed on a standalone basis – the condition of the real estate market, combined with restrictive lending practices in the wake of the financial crisis, makes leveraging existing equity in a home or building limited to only a few eligible borrowers. As a result, many state and local governments have created or encouraged targeted lending and hybrid lending structures to help meet the demand for available, inexpensive capital to finance renewable energy projects. There are countless programs available and such programs range from having a very limited impact, to popular programs like the property assessed clean energy programs.

This Emerging Issues Analysis is excerpted from the Spring 2010 Report of the Renewable Energy Committee of the American Bar Association's Section of Public Utility, Communications and Transportation Law. The Section of Public Utility, Communications and Transportation Law brings together members of the bar interested in the rapidly changing legal environment in the communications, cable TV, internet, electricity, gas, oil pipelines, aviation, motor carriers, railroads, and water industries. The third oldest Section in the ABA, the Section was established in 1917 when public interest demanded regulation of these fields. The Section currently has approximately 3,900 members, plus over 3,000 law students.

The Renewable Energy Committee brings together scholarship and thought leadership on topics involving the economics and legal underpinnings of the U.S. renewable energy industry with an emphasis on energy derived from solar power, wind power, hydrokinetic power, geothermal power, biomass, biofuels and other forms of non-fossil energy. Key areas of focus include renewable energy financing, state and federal subsidies and incentives, environmental and zoning issues unique to the renewable energy industry, including renewable portfolio standards, legislation, public policy and regulatory issues that affect the renewable energy industry. The Committee seeks to coordinate its efforts with those of the other Committees of the Public Utility, Communications and Transportation Law Section to advance common understandings of shared matters of concern and to advance the interests of the Section.

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