Key Insights from the Infocast Solar + Wind Finance and Investment Summit

Renewa recently had the privilege to attend and participate in the 2024 Solar + Wind Finance and Investment Summit, alongside renewable developers and investors at the Arizona Biltmore in Phoenix, Arizona. The event proved invaluable to connect with industry peers, gain insights into emerging trends, and delve into crucial discussions shaping the future of renewable energy finance. We’re excited to share our key takeaways from the Summit, from pressing issues and potential opportunities that were discussed during this three-day event.

Where is the Sponsor Equity/Investor Market Headed?

Our Co-CEO, Gage Mooring, participated in a panel discussion titled “Where is the Sponsor Equity/Investor Market Headed?” Here are some notable takeaways and observations:

• Rising Importance of BESS Technology: The expansion of technologies like Battery Energy Storage Systems (BESS) has significantly impacted the capital stack, with site control costs escalating. As a result, there’s a growing need to explore solutions to bolster equity sponsors, especially as site control costs can comprise up to 50% of the stack in certain cases.
• Opportunities in Preferred Equity: The market presents abundant opportunities for preferred equity, albeit with discerning investors favoring the best platforms. We recognize the importance of positioning ourselves as a top-tier platform to secure such commitments.
• Need for Bespoke Governance Structures: With sizable investments necessitating multiple private investors, bespoke governance structures are becoming imperative to accommodate diverse stakeholders effectively.
• Challenges of Rising Cost of Capital: The increasing risk appetite for preferred equity is driving up the cost of capital, posing challenges for stakeholders. Navigating these dynamics demands strategic approaches to mitigate financial risks.
• Importance of Early Networking: Developers must proactively engage with potential capital partners well in advance, ideally 12-18 months before capital requirements. Building trust and alignment with partners is crucial amid the uncertainties and delays inherent in project timelines.
• Focus on Quality Partners and Projects: Most importantly, the panelists discussed how vitally important it is to focus on quality partnerships.  At Renewa, we pride ourselves on prioritizing quality partners and projects, ensuring disciplined returns with every endeavor. This commitment remains steadfast in navigating the evolving renewable energy landscape.

Additional Insights from Panel Discussions:

• Interconnection Challenges: Interconnection bottlenecks persist as a significant obstacle to project development. Extending site control on pre-NTP projects becomes critical amidst ongoing delays, underscoring the value of partnerships with entities like Renewa.
• Clarity on Regulatory Fronts: The industry awaits clarity on critical regulatory aspects such as the Inflation Reduction Act (IRA), particularly concerning the transferability of tax credits and potential shifts in the definition of ‘domestic content.’ Clearer regulations are expected to catalyze investment and streamline operations.
• Community Engagement Imperative: Enhanced community engagement programs are essential as local resistance mounts, compounded by varying rules and regulations across jurisdictions. Strengthening ties with local communities is pivotal for sustainable project development.
• Emerging Growth Sectors: Notable growth is observed in data centers, BESS deployments near urban centers, and expanding storage mandates across multiple states. These trends underscore the diversification and maturation of the renewable energy market.
• Solar and BESS Market Dynamics: Challenges persist in accessing domestic manufacturing credits for solar panels, while BESS deployments witness a surge in activity, particularly in states with storage mandates. The industry braces for a steep increase in BESS installations, signaling promising growth opportunities despite initial operational challenges.

The Solar + Wind Finance and Investment Summit, attended by over 3,500 participants this year, provided an unparalleled platform for industry stakeholders to converge, exchange ideas, and chart the course for a sustainable energy future. A big thanks to Infocast for hosting informative networking receptions and a high-energy conference.  As we reflect on the insightful discussions and networking opportunities, Renewa remains committed to driving innovation, fostering strategic partnerships, and spearheading the transition towards a cleaner, greener tomorrow.