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Solar Tax Credits

Solar Tax Equity Investment Opportunities with MSL Group

MSL Group Offers Direct Access to Solar Tax Equity Investors

MSL Group offers solar tax equity investment opportunities to qualified investors (high net worth individuals, family offices, etc.).  We originate, structure, fund (as project sponsor) and manage solar assets we develop, which means that investors can access solar tax credits directly, thus avoiding costly financial intermediaries.  The unique feature of our opportunity is that we provide access to non-utility scale solar tax equity investment opportunities – commercial and industrial, non-profit and affordable housing / multi-family solar projects.  Solar tax equity investors can realize returns which are materially higher than current yields on fixed income securities or divident yields.  For example, the return on a solar tax equity investment, which involves very low capital risk, is substantially higher than the yields on high-risk emerging markets debt securities.  Contact Scott Licamele at Ext. 277 for a consultation and list of currently available solar tax equity investment oportunities.

Solar Tax Equity Investment – How it Works

Solar tax equity investment usually range from 6-7 years.  MSL Group offers direct access to investors with federal tax credit appetite who are seeking high returns.  Unlike large investment banks, we pass the full value of the ITC directly to tax equity investors.  MSL Group therefore acts as a Fintech disruptor – eliminating costly financial intermediaries.  

There are four income sources for tax equity investments in solar projects:

1. The Solar ITC (Investment Tax Credit)
2. Accelerated depreciation (MACRS) 
3. Operational cash flows (also known as the “tax equity skim”)
4. An exit payment to the investor when it divests from the partnership, after monetizing the tax credit

The investor can claim the ITC following the Commercial Operation Date (COD), with over 100% of invested capital returned in year one.  Note that IRS rules allow solar investment tax credits to be applied over a twenty year period.  

The total return profile of solar tax equity is, in most cases, materially higher than other tax-advantaged investments such as LIHTC.  The risk profile of solar tax equity investment is very low (because of the forbearance clause related to the debt financing).