Battery Energy Storage Systems: Procurement, Tax Equity, Financing Options, Owner and Offtaker Requirements

Description

The procurement and development of BESS have been on the rise and can provide many benefits and play many roles. Still, they don't always fit neatly into a familiar legal landscape within the renewable energy sector. Counsel must develop a complete understanding of the regulatory challenges, financing options, and deal structures to minimize risks along with key tax considerations for the development or procurement of battery energy storage.

The continued success of renewable energy for electrical power depends on the effective management of the variable output of wind, solar, and other alternative energy resources. Storing energy for later use when production is low is an essential element of managing electrical systems. This fact has garnered a wave of battery-energy storage project financings and increased utility procurement of battery storage projects.

Battery energy storage systems can store energy in a chemical form and be configured for large amounts of power into the grid in a short period or inject a steady amount of power into the grid for an extended amount of time, depending on their intended application. They can also be used as backup power to a connected load demand source. However, these energy systems are riddled with legal, regulatory, financial, and other risks.

Developers, investors, and lenders intending to take advantage of the need for energy storage must be aware of various legal, regulatory, and financing issues associated with BESS.

Listen as our panel discusses key compliance challenges impacting energy storage, effective deal structures for financing, tax equity, owner and offtake requirements, and mitigating risks for BESS projects.