Banks, renewable energy groups, and congressional Democrats are raising alarms about potential harm to clean energy and climate goals from a proposed banking regulation.
Torres, the company's chief investment officer, is among many people and institutions worried that such projects will be nearly impossible in the coming years due to a planned change in banking regulations.," is meant to prevent a global financial crisis by increasing the amount of capital that banks must hold for certain investments to cushion them against potential losses.
Banks help fund the vast majority of renewable energy projects through tax equity investments, which allow the banks to benefit from federal tax credits for renewable energy. Currently, renewable energy drawsthrough tax equity investments, according to the American Council on Renewable Energy. Spurred by tax credit demand, that market is expected to more than double to $50 billion within the next few years.
"Many people joke that we're on the 'solar-coaster,'" Torres said about the ups and downs of renewable energy. "But this is probably the biggest challenge we face right now."that "broad and material changes" are needed to the proposed framework and that he was "aware of the commentary" around the impact to green energy.