Unlocking Energy Development: LRA Benefits and Key Financing Criteria
This comprehensive guide explores how Local Redevelopment Authorities (LRA) can capitalize on energy development opportunities. It covers essential topics including current regulatory environments, permitting processes, renewable power standards, and phased development challenges in urban and rural settings. Additionally, it delves into financing strategies such as Power Purchase Agreements (PPA) and various alternative financing options. Discover the nuances of project finance criteria and crucial considerations like utility cost structures, local incentives, and operator responsibilities.
Unlocking Energy Development: LRA Benefits and Key Financing Criteria
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Presentation Transcript
Kinetic Opportunities How Can Your LRA Benefit from Energy Development? September 26, 2013
Energy Project Development Criteria • Current Regulatory Environment • Permitting (Air, Wetlands, Building, Operating etc.) • Renewable Power Standards (“RPS”) • Existing Utility Infrastructure • Phased Development Challenges • Current and Future Tenants • Urban Versus Rural Location • Technology Considerations
Key Project Finance Criteria • Who exactly will pay for the the utilities or services? • Is payer(s) an investment-grade counterparty? • How will the land/space be controlled? (Ground Lease) • Interconnection and transmission upgrades? • Is the fuel provider (if applicable) creditworthy? • Are there local rebates, grants, tax incentives? • Does project qualify for federal tax benefits? • Are the cost of utilities/projects economically priced?
Structured Energy Project Finance • Power Purchase Agreement (“PPA”) • Energy Services Agreement (“ESA”) • Energy Savings Performance Contract (“ESPC”) • Capital or Operating Lease • Tax Advantaged Structures • Partnership Flip • Sale/Leaseback • Inverted Lease • Tax Exempt Bonds/Lease
Alternative Financing Options • Tax Increment Financing (“TIF”) • Property Assessed Clean Energy (“PACE”) • Private Equity Funds • Utility Joint Venture • Merchant Development (Energy/Utilities Central Plant) • Public Private Partnership (“PPP”)
Operating Cost Considerations Who assumes long-term fuel risk (if any)? Will project trigger standby charges? Does operator assume liquidated damages? Operator Balance Sheet? Who assumes replacement of defective technology? Who provides peril/loss insurance? Local tax considerations? Property/excise tax considerations?
Contact Information Mark S. White Managing Director 617-226-8108 Direct 617-437-0150 Main mwhite@bostonia.com