David Burton Discusses Sequestration and Wind Energy

Cuts, due to sequestration, to the Treasury Department’s cash-grant program for renewable energy projects could have a big impact on the wind industry, according to Akin Gump tax partner David Burton.

Treasury’s Section 1603 cash-grant program allows companies to claim a 30 percent cash grant in lieu of the investment tax credit (ITC), but Burton tells North American Windpower that  “more solar projects may opt for the ITC” because of the sequester. Burton adds this will create “even more demand for tax equity” of which there is already a shortage, and it might lead to “wind projects having to pay higher yields to tax-equity investors.”