Advanced Energy Perspectives

The changing of the calendar is a good time for lists. So far, we at Advanced Energy Economy have given you the Top Five State Policy Battles of 2015. Then there was our list of the Top 10 Advanced Energy News Stories of 2015 – in two parts! Looking ahead, we offered up our Top Federal Policy Areas to Watch. But we’re not done yet. Here are four topics in energy finance to keep an eye on in 2016 and beyond.

The White House announcement last week, on the day of President Obama’s clean energy speech in Las Vegas, resolved two issues that have been dogging the Property Assessed Clean Energy (PACE) market over the past several years. Namely, it clarified how PACE loans could be paired with federally guaranteed mortgages, as well as how those loans could be transferred to new owners, rather than paid off, at the time of the property’s sale.

By Dan Scripps

In 2010, the Federal Housing Finance Authority almost killed Property Assessed Clean Energy Programs (PACE) for residential properties. A lot can happen in five years, and what was once a program on the verge of foreclosure is now a booming market. Also, what a new financing model could mean for current solar consumers and producers.

One of the big stories over the last year has been the rapid growth of leading companies executing direct power purchase agreements for renewable energy, as well as energy storage and fuel cells. The American Wind Energy Association’s recently released 2014 U.S. Wind Industry Annual Market Report adds some detail to the story, noting that over 23% of the wind power contracts signed in 2014 were with corporate buyers and other non-utility groups, including universities, military installations, and units of government. In total, these contracts between wind developers and commercial and industrial, governmental, and educational institutions totaled more than 1700 MW in 2014. 

A pair of deals in the first weeks of the new year suggest that 2015 may be “The Year of the Yieldco.” Earlier this month, Pattern Energy, a leading independent power company (and AEE Member), closed on a public offering that raised $351 million, close on the heels of a deal last month with Tokyo-based Green Power Investment Corp. for rights to a 1 GW pipeline of development projects in Japan. Sol-Wind Renewable Power, a New York-based company that owns a portfolio of solar generation assets, also recently announced an IPO targeted to raise $174 million. These developments show that what Bloomberg New Energy Finance has called the “emerging phenomenon” of yieldcos is not just emerging - it’s here.