Build-Transfer Agreements for Renewable Energy Projects: Deal Structures, Key Challenges and Risk Considerations

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


Conducted on Thursday, May 16, 2019

Recorded event now available

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Program Materials

This CLE webinar will provide energy counsel an in-depth analysis of build-transfer agreements (BTAs) for renewable energy projects. The panel will discuss essential structuring methods for build-transfer transactions, critical components of BTAs, implications for tax equity investments, and overcoming challenges that may arise during the engineering, procurement and construction (EPC) phases of BTA projects.

Description

Build-transfer transactions are creating new opportunities for the development and construction of renewable energy projects. As a hybrid between an acquisition agreement and a construction contract, BTAs allow for the direct ownership of a new renewable energy project as an alternative to power purchase agreements (PPAs) and provide incentives to utility or corporate owners and potential tax equity investors.

In a build-transfer arrangement, a third party develops and constructs a renewable energy project and transfers it to the utility upon completion, assuming regulatory approval and other customary closing conditions for the transaction. The developer secures the land rights, permits, project contracts and other rights necessary to build the project for the utility. The utility then takes ownership in accord with the terms of the BTA.

Parties of this type of deal structure must consider features of both M&A purchase and sale agreements and EPC agreements. Counsel must negotiate and properly tailor essential provisions such as development-stage and construction-stage covenants, closing conditions, warranties, limitations of liability, and project oversight.

Listen as our panel discusses structuring techniques for renewable energy project development using BTAs, provisions to reduce risk, implications for construction financing, the potential advantages of tax equity investments, and overcoming regulatory obstacles for build-transfer transactions.

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Outline

  1. Challenges and opportunities of utility ownership
  2. Structuring build-transfer arrangements for renewable energy projects
  3. Negotiating key terms and avoiding mishaps in drafting BTAs
  4. Regulatory compliance issues and best practices for counsel

Benefits

The panel will review these and other key issues:

  • Effectively using BTAs for renewable energy project development
  • Negotiating and drafting representations, warranties, covenants and other key provisions
  • Construction financing of BTA projects
  • Impact of BTAs on projects using PTCs or ITCs
  • Tax-equity investments in BTA deals
  • Overcoming regulatory compliance issues for both sellers and purchasers

Faculty

Bonovich, Matthew
Matthew Bonovich

Special Counsel
Sheppard Mullin Richter & Hampton

Mr. Bobovich has been working on energy transactions for over a decade, with particular experience in renewables....  |  Read More

Hoeppner, Nathan
Nathan Hoeppner

Associate General Counsel
Invenergy

Mr. Hoeppner is a member of Invenergy’s in-house legal team focusing on commercial transactions, including...  |  Read More

Shaw, Frank
Frank C. Shaw

Counsel
Skadden Arps Slate Meagher & Flom

Mr. Shaw’s practice has focused for more than 25 years on the development and finance of international and U.S....  |  Read More

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