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Energy Seminar: Energy Policy (and Politics) in Theory and Practice: A Case Study in Renewable Energy Finance

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January 13, 2014 4:15pm - 5:15pm

Room Offsite

    Since 2012, we have been exploring the potential of master limited partnerships (MLPs) and real estate investment trusts (REITs) to spur the deployment of renewable energy. Technological innovation continues to bring down the cost of solar panels, wind turbines, and other equipment but financial innovation is lagging. As a result, financing charges may drive up a renewable power project's levelized cost of electricity by up to 50%. Our analysis suggests that MLPs and REITs have the potential to significantly reduce the cost of capital for renewable energy. But even the smartest policy proposal does not earn legislative approval easily, as illustrated by the MLP Parity Act which enjoys strong support on both sides of the aisle but still faces a tricky road in Washington. It takes time, ingenuity, and political savvy to build necessary support in the industry, on Wall Street, and on Capitol Hill for even a well supported idea like this. We will present the results of our analytical work as well as insights from our advisory participation in the ongoing political process.

     

     

    Brief Bios:

    Dan Reicher is Executive Director of Stanford’s Steyer-Taylor Center for Energy Policy and Finance, a joint center of the Stanford business and law schools where he holds faculty positions. Reicher previously directed Google’s energy and climate initiatives, was an investor and executive in the clean energy industry, and served as Assistant Secretary of Energy and Energy Department Chief of Staff in the Clinton Administration. He also was a member of President Obama’s Transition Team and early in his career a staff member of President Carter’s Commission on the Accident at Three Mile Island. Reicher serves on the National Academy of Sciences Board on Energy and Environmental Systems and the Secretary of Energy Advisory Board.

    Felix Mormann is Associate Professor at the University of Miami School of Law and Faculty Fellow at Stanford University's Steyer–Taylor Center for Energy Policy and Finance. Professor Mormann's scholarly interests lie at the intersection of law and innovation in the context of environmental and energy law, finance, and policy. Mormann's recent publications include Beyond Tax Credits – Smarter Tax Policy for a Cleaner, More Democratic Energy Future, 31 Yale J. Reg. (2014 forthcoming) Enhancing the Investor Appeal of Renewable Energy, 42 Envtl. L. 681 (2012), and Requirements for a Renewables Revolution, 38 Ecology L. Q. 903 (2011).

    Suggested Readings:

    Smarter Finance for Cleaner Energy: Open up Master Limited Partnerships (MLPs) and Real Estate Investment Trusts (REITs) to Renewable Energy Investment

    Beyond Tax Credits – Smarter Tax Policy for a Cleaner, More Democratic Energy Future

    How to Make Renewable Energy Competitive

    Using REITs for Renewable Energy Projects

    Equity Research

     

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