Underwriting Considerations for Tax Credit Solar & Storage Transactions

Synopsis

Tax credit structures in solar and storage financing continue to evolve rapidly, introducing complex considerations for lenders and investors underwriting these transactions. This panel explores how lenders and capital providers are adapting underwriting processes to manage risks and refine deal structures for both solar and standalone storage assets.

• Are lenders becoming more conservative in their underwriting assumptions? How is this affecting capital availability, debt sizing, and pricing?
• How prevalent are preferred equity or membership-interest-collateral structures becoming in back-leverage arrangements?
• How effective have insurance products proven to be in mitigating tax and operational risks in solar and storage transactions?
• Are appraisers realistically accounting for the complexities of newer tax credit structures and storage assets?
• How are discrepancies between appraisal valuations and lender expectations being managed?