Project Financing Models Affect Solar Adoption Rates

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In an article published by the Daily Journal, Stoel Rives attorney Morten Lund discussed the impact of tax equity investment incentives on the adoption of solar energy. In recent years solar companies have tried to increase the affordability of solar technology through the introduction of a leasing model. The success of the leasing model has depended on new financing models, federal and state tax incentives, and tax equity investments.

Although the new leasing model has spurred a spike in the market, Lund notes that tax equity financing concentrates financing among a few categories of projects. "I see the cost greatly in projects that can't be built because they can't get tax equity," says Lund. "It forces you into a fairly peculiar set of financing and kills good projects."

Some industry insiders are nervous about the looming tax credit reduction set to take place in January 2017. Lund, however, sees this as an opportunity to open up financing to more categories of projects.

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"Institutional investors pave the way for solar panel leases" was published by the Daily Journal on July 15, 2013.

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Morten A. Lund
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