Tax Equity
What is tax equity?
Tax credits have been extended by the federal government to promote investment into renewable energy. Different forms of renewable energy include: biomass, hydropower, geothermal, wind, and solar. When investing in a renewable project, the investor may be able to receive tax credits in addition to depreciation deductions. If the investor does not need the entirety of tax credits / deductions, they may seek tax equity investors who have higher tax liabilities to offset.
What is a tax equity fund?
A tax equity fund is a structure to invest across several renewable projects where the investor may receive tax equity incentives.