Segue Sustainable Infrastructure

Today, Reunion celebrates an exciting milestone: we have facilitated the purchase and sale of over $1.5 billion in clean energy tax credits for the 2024 tax year! Our transactions span solar, wind, battery storage, fuel cells, biomass, and advanced manufacturing components. Reunion now works directly with dozens of Fortune 500 tax credit buyers and leading clean energy companies, and we have observed several emerging trends: 📍 Speed is a critical factor in winning deals: An increasing number of deals are competitive bidding situations. Buyers should have a clear sense from relevant stakeholders (e.g., CFO, legal, board of directors) on what deal terms are acceptable and what specific approvals are required prior to starting the negotiation process, as delays can be the difference between winning and losing a deal 📍 Very large credits carry premium pricing: There has been increased interest in tax credit purchases from major corporations that pay $500M to $1B or more in annual taxes, resulting in more competition for large credit opportunities. As a result, these opportunities tend to trade at a premium 📍 Increased buyer interest in ITCs: many buyers were reluctant to pay for ITCs early in the year, because it required “pre-paying” for taxes. As a result, buyers willing to purchase ITCs in Q1 or Q2 were rewarded with deeper discounts. Now that we are solidly in Q3 and payments for ITCs will not occur until later in the year, buyer interest has increased 📍 Pricing on ITCs, PTCs, and AMPCs has trended upwards in Q3: buyers, particularly ones that have bid and lost on tax credit opportunities, want to make sure that they lock in credits in time to offset Q3 and / or Q4 estimated tax payments 📍 However, there is a price ceiling on ITC transactions: ITCs are still expected to trade at a wider discount compared to production credits. Although sellers often ask for mid-$0.90s pricing for ITCs, buyers typically push back since lower risk PTCs or AMPCs would be available at similar pricing 📍 Scope and coverage of insurance is a focus of deal negotiation: initially, tax credit buyers demanded tax credit insurance to cover 100% or more of the tax credit value. We are seeing more flexibility in structures, whereby insurance may not cover the full tax credit amount due to presence of other risk mitigants such as portfolio diversification, creditworthy seller indemnities or parent guaranties You can read about a selection of our transactions here (https://bit.ly/3AubPJW). If you are looking to buy or sell clean energy tax credits, or if you would like to join our rapidly growing team - please get in touch! #cleanenergy #ira #reunion #taxcredits

🎈 Celebrating 3 Years! 🎈 Reflecting on Sol Source Power’s three-year anniversary fills me with gratitude and pride. Our company’s success has been driven by the incredible talent within our team of Sol-Sorcerers, these individuals truly set us apart and are the fuel behind our expansion and growth. Building strong relationships is at the heart of development, and this team excels in every aspect of it. We owe a tremendous amount to our key partners, whose support has been invaluable. Sunwealth has continuously championed our success, aligning with our mission and offering meaningful guidance and support to our team. Segue Sustainable Infrastructure has propelled us forward, giving us the ability to leverage our position across multiple markets. Dimension Energy has been instrumental in partnering with our team to drive the renewable transition in key Midwest states. Nexamp has been an advisor and thought partner and ultimately the long-term owner of our largest project to date. Our collaboration with Kearsarge Energy, built upon years of trust, kept all stakeholders aligned and focused on enabling the construction of a project that had a tight timeline. And Generate Capital stands as a steadfast long-term asset owner, whose collaboration consistently pushes us toward greater achievements. On this third anniversary, I am deeply grateful for our journey from a team of one to a powerful group of 22 industry impactors. Here’s to many more years of innovation and growth ahead! - Lindsey McEntire ☀ Sol Source Power Co-Founder and Chief Development Officer

Neerav Jashnani recently joined the Segue Sustainable Infrastructure team as a Principal on the investment team. We're really pumped to bring his considerable experience and network into the Segue fold. Neerav was most recently at Greenbacker where he lead both project M&A and project financing transactions and racked up quite a book of success. Before Greenbacker, Neerav was at Onward Energy (fka Novatus) and CIT's renewable project financing desk. Welcome Neerav! #energytransition #renewableenergy #developmentcapital

The California PUC’s decision against CCSA's Net Value Billing Tariff is a sobering reminder of the continuing challenges in expanding community solar, and one that has left a chill among developers. Ultimately, we believe in the strengths of community solar and in this industry’s ability to continue advocating for enabling legislation, but we also believe that now may be the time for the industry to consider new angles to supporting community solar, a sentiment that was echoed at last week's #CommunitySolarSummit. In our latest post, Segue partner Kristina Shih reflects on the status quo within the community solar industry, and where the industry must evolve and innovate a path forward amidst the broader DER industry. Read more: https://lnkd.in/gjfcJwNM #communitysolar #DERs #VPPs

The California PUC’s decision against CCSA's Net Value Billing Tariff is a sobering reminder of the continuing challenges in expanding community solar, and one that has left a chill among developers. Ultimately, we believe in the strengths of community solar and in this industry’s ability to continue advocating for enabling legislation, but we also believe that now may be the time for the industry to consider new angles to supporting community solar, a sentiment that was echoed at last week's #CommunitySolarSummit. In our latest post, Segue partner Kristina Shih reflects on the status quo within the community solar industry, and where the industry must evolve and innovate a path forward amidst the broader DER industry. Read more: https://lnkd.in/gjfcJwNM #communitysolar #DERs #VPPs

We're excited to announce the addition of Lambros Theofanidis to our investment team at Segue. As with all members of the team, Lambros will be a bit of a "generalist" focusing on everything from new investments, to supporting our development partners in mitigating risks and creating value, to selling projects when the time comes. It's a huge add for us as we digest what has become a pretty massive (~9 GW of active #solar and #bess projects) first portfolio/pipeline, and deploy our second pool of capital into an opportunity-rich environment for development capital. Lambros' has fantastic breadth of knowledge and relationships which we're thrilled to fold into our operations. #energytransition #renewableenergy #developmentcapital

We're excited to announce the addition of Lambros Theofanidis to our investment team at Segue. As with all members of the team, Lambros will be a bit of a "generalist" focusing on everything from new investments, to supporting our development partners in mitigating risks and creating value, to selling projects when the time comes. It's a huge add for us as we digest what has become a pretty massive (~9 GW of active #solar and #bess projects) first portfolio/pipeline, and deploy our second pool of capital into an opportunity-rich environment for development capital. Lambros' has fantastic breadth of knowledge and relationships which we're thrilled to fold into our operations. #energytransition #renewableenergy #developmentcapital

Very excited to share that we’ve partnered with The Clean Fight, New Energy New York, NYSERDA, New York Battery and Energy Storage Technology Consortium (NY-BEST), New Energy Nexus and others in The Energy Storage Capital Challenge.  We will be collaborating with other leading capital partners to workshop innovative energy storage projects in need of funding to advance their deployment in New York State. Most importantly, we hope to capitalize a few of these development-stage projects and further the energy transition.  We look forward to helping projects through this challenging development chasm and support New York’s REV process and clean energy goals!  

Our last post (https://lnkd.in/gzG6aXRg) showed the time horizons and capital intensity required for energy projects to secure interconnection rights in different power markets. And that’s just the interconnection path! Layer on all the different permitting regimes, regulatory risks, offtake markets, etc. and the reality is laid bare: risk comes in many shapes and forms (including invisible) when developing renewable energy projects... and the sum of all these risks is considerable. As always, where there’s risk, diversification is a savior. 2.5 years into Segue’s first portfolio, we are very excited to have partners developing projects across all US ISOs.  Geographical and market diversification are crucial in this sometimes-binary game.  We wish we could claim prescience, or some sort of cool portfolio construction secret sauce, but…. let’s just say that wouldn’t be entirely accurate. We appreciate all the developers that decided to partner with us and the friends of Segue that made those introductions! And yes! If you know of great people developing projects in North America, send them our way!

Our last post (https://lnkd.in/gzG6aXRg) showed the time horizons and capital intensity required for energy projects to secure interconnection rights in different power markets. And that’s just the interconnection path! Layer on all the different permitting regimes, regulatory risks, offtake markets, etc. and the reality is laid bare: risk comes in many shapes and forms (including invisible) when developing renewable energy projects... and the sum of all these risks is considerable. As always, where there’s risk, diversification is a savior. 2.5 years into Segue’s first portfolio, we are very excited to have partners developing projects across all US ISOs.  Geographical and market diversification are crucial in this sometimes-binary game.  We wish we could claim prescience, or some sort of cool portfolio construction secret sauce, but…. let’s just say that wouldn’t be entirely accurate. We appreciate all the developers that decided to partner with us and the friends of Segue that made those introductions! And yes! If you know of great people developing projects in North America, send them our way!