Seen as a surprising step, representatives of the U.S. Energy Department are hosting a meeting with large U.S. Corporations to promote the benefits of renewable energy investments in a bid to boost funding options for the industry. This move comes on the heels of the completion of a government stimulus program that expired December 31, 2011.
Companies including Exxon Mobil Corp. and Walt Disney Co will have Steven Chu, Energy Secretary, promoting the benefits of renewable energy investments, specifically the tax-equity markets. The meeting, set for March 13th, is an attempt to reinvigorate a slowing tax equity market.
Large financial companies, such as AIG, Lehman Brothers, Wachovia, and JP Morgan, have been buying tax benefits from solar companies that don’t have enough taxable income to use those credits. Tax-equity investors get to use those credits as part of a strategy to shelter otherwise taxable income. This has changed drastically as a result of the financial crisis. There are fewer banks and investment banks; and the larger banks that have survived, have shifted their tax strategies. With fewer tax-equity investors, the competition for funding is heating up.
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