John Marciano Talks Renewables Financing Post-Tax Reform with Grid Geeks

John Marciano, co-head of the global project finance practice at Akin Gump, spoke with Grid Geeks about the issue of renewables financing, in a podcast titled “Financing the Future.” The conversation addressed the recent tax reform legislation and its impact on renewable energy development and deployment across the United States.

Marciano first spoke about the structure of a project financing deal, which he described as “lending or equity investments where the return is expected to come solely from the assets and the operation of the assets.” He discussed why this makes sense for a renewables development and how much of the renewables development across the United States depends on this type of finance structure.

Marciano also talked about the history of the investment tax credit and production tax credit—both of which are offered to help offset the costs of project financing. He noted that they both help bring “the overall cost of the project down by developing infrastructure behind it.”

The impact of tax reform legislation on renewables financing was also a topic of discussion, with Marciano pointing out that several provisions from the new law are making their way into deals. This includes bonus depreciation, which he described as “the ability to speed up the depreciation schedule.” The new rule, he said, allows developers “to write [the bonus] off all in year one, which is more akin to expensing.”

Finally, Marciano talked about storage financing costs, which he said will be an important issue in the future.

To listen to the full podcast, please click here.