Three global firms in the financial services sector want federal regulators to clear a cash investment to receive clean-energy tax credits from a thermal solar plant near Tonopah.
If the Federal Energy Regulatory Commission approves the deal, subsidiaries of Capital One Financial Corp., Mitsubishi UFJ Financial Group Inc. and Toyota Tsusho Corp. could invest in the Crescent Dunes project, which sells its electricity to NV Energy. In return for their investment, the firms would receive tax credits they can apply to discount their own taxes.
The transaction is expected to close within the next two months.
Bloomberg first reported the proposed deal.
The Crescent Dunes project, led by renewable developer SolarReserve Inc., completed its synchronization with the utility grid last fall. Over the next year, the plant will reach its full annual output of 110 megawatts, which it will sell to the utility for the next 25 years. SolarReserve says the plant is unique because it can generate power at night, relying on a energy storage technology that allows it to produce electricity without solar present.
Crescent Dunes is seen as an economic development success. In 2011, the U.S Department of Energy issued a $737 million loan to fund the project. At the time, it was expected to create 600 construction jobs. According to a Department of Energy website, 45 permanent jobs are projected to result from it.
In the regulatory document filed Wednesday, the financial firms did not disclose the size of their investments. Selling tax credits, however, is not unusual for renewable energy projects. In fact, such deals are one of the primary financing options for clean energy projects, which do not always have the large tax base necessary to take full advantage of some tax credits.
In addition to SolarReserve, renewable manufacturer ACS Cobra, whose affiliate constructed the Crescent Dunes, and the financial services firm Santander, are also investors. Under the deal pending before the federal energy commission, these three investors would maintain most of their original investment with the three new firms playing a largely passive role.