Day 3 - Renewable Energy World Conference Morning - Mega Session
Thursday, February 25, 2010 at 11:42AM Hello once again from the Renewable Energy World Conference in Austin, Texas. Today was the last day, and i attending the last event of the conference, the Mega Session on Post-Stimulus Finance of Renewable Energy Projects. Pretty interesting stuff. As usual, you can see my summary or the morning session below. Got some work to do in the afternoon, and then I am back to Stanford bubble for the time being.
Day 3 – Megasession on Post-Stimulus Policy and Finance
Ken Bruder – GM at Bloomberg - New Energy Finance in North America
- Green Stimulus – One Year Later
- From supply constrained environment (manufacture controlled) to buyer constrained market (consumer controlled)
- U.S. has the biggest clean tech package at $66 billion dollars, > China
- Money has not really hit the ground until now
- Stimulus is going to cause an oversupply of wind equipment
- Ironically, most of new supply growth will not be with U.S. companies
- Spot price of solar has declined dramatically
- Asia has taken the lead in financing for clean tech projects
- Solyndra and A123 helped dramatically by DOE loans as part of the stimulus package
- Renewables remain uncompetitive with fossil fuels
- Supply of renewable is there, need to focus on the demand side of renewable energy
Edwin Feo - Partner - Milbank Tweed Hadley & McCloy LLP
- Post-Stimulus Finance
- Treasury Grant Program – About $2 billion has gone to renewable energy projects
- Construction has to start by 2010 to be eligible
- Banks would advance 95% against the size of the grant
- What’s Next? – HR4599 – Renewable Energy Expansion Act of 2010
- Refundable tax credit for projects starting by 2012
- What about 2010?
- Amount of debt/loans to go up
- Terms of loans will improve for borrowers
- More open to small projects
- Possible extension of the grant
- Treasury Grant Program – About $2 billion has gone to renewable energy projects
Tina Neal – Senior Vice President - PiperJaffray
- Determining Financial Feasibility - Cash Flow Management, Collateral, Management, Fundamentals, Mitigating Risk
- Where we are now
- Liquidity is still a concern
- Project sizes are smaller – from 50Mà25M
- Reliance on subsidies , mood is still cautionary
- Where we are going
- Higher interest rates on loans
- Development of markets needs to replace government subsidies
Martin Lebovits - Senior Funding Manager – Illinois Finance Authority
- Illinois Energy Finance Initiative
- Illinois Finance Authority – access to capital they need for growth for various industries
- The Solution to Capital
- $3 Billion of loan guarantees for project finance
- Eliminates the risk of refinancing
- Secured by obligation of the State of Illinois
- Provide forms to help projects quickly work through financing
- Not a requirement that project participate in DOE loan guarantee program
- New Applications
- Can be applied to energy infrastructure, retrofit existing structures
- Can also be applied to energy efficiency improvements
Mike Taylor – Director Research and Education – Solar Electric Power Association
- Financing
- 400Mw installed solar in 2009, 1200Mw with 90,000 systems cumulative total
- 20% solar by 2030, 38Gw/yr needed
- Need $15-30 billion in financing yearly
- Commercial systems are third party owned and financed
- PACE – municipal financing for solar energy



