$1.3 trillion for clean energy and infrastructure
On April 22, the symbolic Earth Day, the President of the United States of America reaffirms that the U.S. will play a leading role in climate action from now on. At the global climate summit he convened, he outlines how he intends to live up to this claim to leadership. The most important tool in this effort is the planned multi-billion-dollar infrastructure program.
With investments totaling $1.3 trillion, the dilapidated infrastructure system is set to be completely overhauled. A full $100 billion is earmarked for replacing defective power lines and building new ones. Funding will also be provided for decentralized local power grids, known as “microgrids,” which are powered by renewable energy sources. These are intended to make communities self-sufficient in terms of power supply in the event of environmental disasters, thereby better protecting them from the consequences of climate change.
New Opportunities for Project Development Through Tax Incentives
While tax breaks for fossil fuels are set to be eliminated, extending the “tax credits” for renewable energy projects by at least ten years and making changes to the tax code to accommodate hep’s business model are of great importance.
The so-called “Direct Pay” option, which has already been proposed by both Biden and Congress, would simplify financing mechanisms and thus enable planned solar projects to be implemented even faster—especially if it becomes possible in the future to forgo the involvement of tax-equity investors.
“The announced infrastructure program is excellent news for hep. It will allow us to implement projects from our pipeline even more efficiently and thus contribute to the rapid expansion of renewable energy in the U.S.,” says Dr. Alexander Zhou, Chief Project Officer, adding: “Thanks to our existing contacts and extensive expertise, we are ideally positioned in the U.S. solar market and well-equipped to profit from the announced decisions.”
Corporate bond finances early-stage projects
While hep has primarily financed project development services through its own project development funds over the past ten years, it now conducts so-called early-stage and active-development project development on its own account.
Recently, hep global GmbH decided to issue a corporate bond to finance future photovoltaic projects in these phases. Christian Hamann, founder and CEO of hep global GmbH: “We have a massive project pipeline of 5.3 GWp, which we now intend to develop and further expand on our own account using the expertise we have built up over many years.”
As early as 2020, hep decided to expand into the U.S., the world’s second-largest solar market. The acquisition of project developer Solops was followed by a majority stake in project developer ReNew Petra, which holds construction permits in 14 U.S. states. With deep market knowledge, an extensive network, and a project pipeline of 4,800 MWp, hep is well-positioned in the U.S. for future developments.
