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Structuring Private Equity Funds for Investment in Renewable Energy Projects: A New Financing Option

Recording of a 90-minute premium CLE webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
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Conducted on Thursday, November 8, 2018

Recorded event now available

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This CLE course will provide finance and energy counsel with tools to structure a private equity fund dedicated to investment in renewable energy projects. The panel will discuss the advantages of the private equity model, and how energy private equity (EPE) funds are similar to and different from traditional private equity funds.

Description

The emerging trend of EPE funds is revolutionizing the renewable energy field. Energy sponsors are increasingly eschewing the traditional project finance structure, where sponsors seek investment partners and financing for each deal, in favor of a fund structure where the sponsor deploys committed capital according to a specified investment strategy. Private equity has proven to be more efficient and cost-effective for renewable energy companies seeking capital.

This trend can be seen as evidence of renewable energy maturing as an asset class. Since EPE funds are relatively new, their terms vary. However, there are some concerns common to EPE funds which distinguish them from traditional private equity funds. Provisions must be tailored for renewable energy investment regarding capital raising, investment strategy, carried interest and management fees, distribution structure, and investment period.

Counsel to renewable energy clients should have a working knowledge of private equity as a finance option, and private equity counsel should understand the structural nuances of an EPE fund.

Listen as our authoritative panel discusses the advantages of private equity over other financing options for renewable energy projects and the similarities and differences between EPE and traditional private equity funds. The panel will also discuss how tax credits, regulatory compliance, and other aspects of renewable energy investment to address in EPE fund documents.

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Outline

  1. Advantages of private equity over one-off renewable energy investment structures
  2. Incorporating tax credits and other incentives
  3. Comparison of EPE to traditional funds
    1. Committed capital
    2. Investment strategy
    3. Carried interest and management fees
    4. Distribution structure
    5. Fundraising period
    6. Investment period and fund term
    7. Governance

Benefits

The panel will review these and other highly relevant issues:

  • How is private equity preferable to existing project finance structures in renewable energy?
  • What issues are unique to renewable energy as an asset class?
  • How might fundraising, investment strategy, partner consent, and investment period differ in an EPE fund?
  • Are current tax credits and other incentives still available in the EPE fund structure?

Faculty

Baker, Hayden
Hayden S. Baker
Partner
Troutman Pepper

Mr. Baker assists clients in mergers and acquisitions, energy and infrastructure projects, real estate deals and...  |  Read More

Dajani, Mona
Mona Dajani
Partner
Baker & McKenzie

Ms. Dajani is a partner in the New York and Chicago offices of Baker McKenzie and is an elected member of the Steering...  |  Read More

Reisler, Marc
Marc S. Reisler
Partner
Holland & Knight

Mr. Reisler is a partner in the Business Section of Holland & Knight's New York office. He focuses...  |  Read More

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