The latest on Energetic and renewable energy trends.

In today’s market, developers of large utility-scale renewable projects are facing new friction points, not from regulators or financiers, but from their offtakers. Whether the buyer is a Fortune 500 subsidiary or an unrated commercial entity, pushback on credit support requirements is mounting.

For years, financiers have relied on a range of buyer credit support instruments to secure transactions, including letters of credit (LCs), parent guarantees, cash collateral, and more recently, surety bonds. These have been structured in various ways, such as fixed dollar amounts per megawatt or rolling multiples of project revenue over a given period.

More recently, financiers have started noticing a change. Buyer credit support coverage is shrinking and deals that once checked every box now look atypical to credit committees.

The Developer’s Dilemma

PPAs, and related credit support, are often negotiated years before a project is ready for project financing. Often there is a disconnect between the credit support the sponsor expects, and what lenders ultimately need. When financiers identify insufficient credit support, developers face an uphill climb. Asking offtakers to increase or restructure posted collateral is often unrealistic. From the offtaker’s perspective, the traditional instruments represent an inefficient use of capital.

Letters of credit draw directly on corporate LC facilities, limiting growth capacity. Parent guarantees create balance sheet liabilities for investment-grade parents. Cash collateral locks up working capital that could otherwise fund expansion.

In every case, the offtaker carries a balance sheet burden that makes it difficult to scale across multiple projects.

A Smarter Way Forward: Credit Insurance as Supplemental Support

Energetic Capital is helping developers and offtakers address this challenge in a more efficient way. Our credit insurance product, backed by an investment-grade balance sheet, fills the gap between what a financier requires and what an offtaker can reasonably post.

Instead of increasing the offtaker’s LC or collateral, developers can use a cost-effective, off-balance-sheet insurance solution that satisfies the financier’s credit committee and enhances project bankability.

An Example in Action

Consider a transaction where an offtaker is required to post two years of project revenue as credit support, or $50 million total ($25 million per year). Instead of tying up all $50 million, the structure could look like this:

• The offtaker posts $10 million through a traditional LC or parent guarantee.
• Energetic Capital provides credit insurance covering the remaining $40 million exposure.

This gives financiers full comfort since an investment-grade insurer stands behind the obligation while freeing up the offtaker’s LC capacity for additional projects.

From the developer’s standpoint, this is a triple win. The financier is protected by a strong counterparty, the offtaker frees up capital, and the developer strengthens their reputation as a creative, solution-oriented partner.

Cost Efficiency Through Layering

Because the retained $10 million functions as a first-loss layer, the insurance policy operates as an excess layer. This reduces the cost of coverage and makes the structure more efficient and scalable. Developers and offtakers can deploy capital across more projects without compromising credit quality.

Enabling the Next Wave of Utility-Scale Growth

As buyer credit support norms evolve, flexibility and creativity in financial structuring will become key advantages. Energetic Capital’s credit insurance solution provides developers and financiers with the confidence to move forward on large-scale commercial offtake transactions without balance sheet strain or lengthy renegotiations.

By turning static credit requirements into scalable financial solutions, Energetic Capital is helping accelerate the deployment of renewable infrastructure globally.

An Open Invitation

If you’re developing large-scale renewable projects or managing commercial offtake agreements, now is the time to rethink how credit support is structured. Whether you’re working with an investment-grade buyer, a subsidiary, or an unrated counterparty, there’s a scalable path forward that doesn’t tie up balance sheets or stall growth.

Bring us the transaction where credit support is holding up progress. Maybe it’s a buyer that can’t expand its LC facility or a lender that needs additional comfort to close. Energetic Capital’s mission is to unlock liquidity and enable the next wave of renewable infrastructure deployment—helping developers and offtakers move faster, smarter, and at scale.

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Let's have a discussion!

We’re thrilled to support Bridge Renewable Energy (BRE) in closing an $80 million term loan facility and $5 million revolving credit facility to advance a 40 MW portfolio of distributed solar and battery storage projects across nine states.

The financing,arranged by Investec Bank PLC with participation from Amalgamated Bank and Farmer Mac, includes construction-to-term, preferred equity bridge, and tax credit bridge capacity, enabling the development of 42 community solar and commercial & industrial projects nationwide.

Energetic Capital’s EneRate Credit Cover® provided credit enhancement to support broader lender participation and help unlock efficient capital for distributed generation projects.

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📄 Read the full announcement on GlobeNewswire

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Thinking about your next project?

If you’re looking to expand access to capital through credit enhancement, we’d love to talk.

👉 Contact Us to learn how EneRate Credit Cover® can help you scale.

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USDA Pulls Back on Renewable Guarantees

In August 2025, the USDA announced sweeping changes to its renewable-energy programs, a move that alters how solar projects in rural and agricultural markets will be financed. Secretary Brooke Rollins declared that USDA would “no longer deploy programs to fund solar or wind projects on productive farmland,” citing concerns over taxpayer subsidies and land use (pv-magazine-usa).

Under the new policy:

• Solar and wind projects are now ineligible under the USDA Business & Industry (B&I) Guaranteed Loan Program (usda.gov).
• Ground-mounted solar systems larger than 50 kW, orthose without documented historical energy usage, lose access to REAP guarantees or priority grants (solarpowerworldonline).
• Certain foreign-manufactured panels are disqualified from USDA-supported projects (usda.gov).

By pulling back guarantees that worked, USDA has left lenders, developers, and more importantly rural communities with fewer options; jeopardizing projects that lower operating costs, build resilience, and expand opportunity.

How Energetic Capital Steps Into the Gap

The shift in USDA policy does not mean rural solar finance must come to a standstill. At Energetic Capital, we’ve been in this space for years, and our product is designed to step in where USDA is stepping back.

Inspired by proven frameworks: Our underwriting and risk-mitigation structure draws on programs like REAP, but adapts them for private markets. Over the last eight years, we’ve supported more than 1,500renewable infrastructure projects - many in agricultural and rural communities.

Backed by strength: Our product rests on aninvestment-grade balance sheet, giving lenders and syndication/participationpartners the confidence to move forward.

Focused on resilience: We’re already talking withformer REAP lenders and developers to ensure rural pipelines stay alive, evenin the face of shifting federal support.

Protect Your Pipeline

If you’re a developer, lender, or agricultural stakeholder whose pipeline depended on USDA guarantees, now is the time to explore alternatives. Let’s talk about preserving your deal pipeline that keeps capital flowing into the rural communities that need it most.

REAP may have been curtailed, but resilient infrastructure for rural America doesn’t have to be.

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Last August, we posted a collection of our favorite summer reads, and we got a lot of feedback and engagement. This year, we want to share what we plan to read this summer. Encourage everyone to see if they can find these in their local independent bookstore.

Peter: Exit West by Mohsin Hamid

This book explores the global refugee crisis through a blend of realism and speculative fiction. Centered on two individuals forced to flee a city on the brink of civil war, the narrative follows their journey through a series of mysterious portals that instantly transport them to different parts of the world. Hamid uses this imaginative device to examine the psychological and social dimensions of migration, displacement, and adaptation. With spare, elegant prose, the novel offers a thoughtful meditation on identity, impermanence, and the evolving concept of borders in an increasingly interconnected world.

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Amy: Swimming Pretty a book by Vicki Valosik

I love to read novels and very rarely read non-fiction for pleasure, but I am genuinely looking forward to reading this book about the history of synchronized swimming. My daughter is an artistic swimmer and now that I am a "synchro mom", I can't wait to learn more about the sport that now dominates my weekends.

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Nathan: Lincoln's Peace: The Struggle to End the American Civil War by Michael Vorenberg

I have been interested in geo-political evolutions of states and societies after an armed intervention; the Marshall Plan following World War II is a notable policy divergence from the isolationist response following World War I. Lincoln's Peace explores the end of the Civil War and the lessons we can draw from the way armed conflicts end. The Reconstruction Era, and some of the subsequent eras considered by comparison (like the Vietnam War) were also times of significant political division. I am hoping to uncover new perspectives on how to think about hyper-partisanship and find evidence of the old addage "this too shall pass".

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Jeff: Change - How to Make Things Happen by Damon Centola

This is a deeply researched examination of change and the spread of ideas, which I believe is very relevant in a world where AI and social media accelerate the pace of change, regardless of whether it is based in fact or belief. Additionally, as entrepeneurs, we need to be evangelists for our vision, and influence others to share that vision. Understand how ideas take hold is an important skill to continue refining.  

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Vinny: Build - An Unorthodox Guide to Making Things Worth Making by Tony Fadell

A career path is littered with choices. BUILD is a chronicle of the choices - good and bad - of a life long entrepreneur. I hope to learn from this collection of vignettes and add perspective when looking back, but also to help look forward.

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Happy reading!

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The SEIA Finance, Tax, and Buyers Summit once again delivered sharp insights and honest discussion at a pivotal time for the solar industry and and broader energy transition. With shifting legislative winds and tightening financial conditions, this year’s summit was marked by a mix of cautious optimism and pragmatic concern.

The Mood Around the “Big Beautiful Bill”

Unsurprisingly, the conversation around the proposed the President's budget legislation — fondly dubbed the “Big Beautiful Bill” — was front and center throughout the event. While many in the industry are rightly worried, the overarching feeling was one of calculated resilience rather than alarm.

A primary source of uncertainty stems from ambiguity in the bill’s language, particularly around the timeline for eligibility under the different tax credit regimes. A notable insight discussed at the summit was the apparent pivot in the Senate version of the bill, which reverts the eligibility "test" back to the start-of-construction date. If the previous application of the Jan 2023 start of construction safe harbor for prevailing wage is any indicator, this treatment could prolong the phase out of credits. If that interpretation holds in the final version, the feared cliff effect could instead manifest as a gradual slope.

Another significant unknown revolves around the Foreign Entities of Concern (FEOC) rules. Their eventual definition and enforcement mechanisms remain murky, and the potential implications for supply chain eligibility and investor confidence are substantial.

Despite these challenges, there’s a sense of resolve. SEIA deserves recognition for its vigorous efforts to educate policymakers on the substantial economic and strategic value the IRA and clean energy investment more broadly bring to the U.S. economy. The message from industry leaders was clear: the sector is not going quietly, nor is it going anywhere. As in past regulatory shifts, companies will adapt and forge ahead.

Credit Risk at the Forefront

Credit quality dominated the financing panels and hallway conversations alike. The dominant strategy for financing distributed generation (DG) over the past few years has been aggregating projects into diversified portfolios to offset individual credit risk. This approach is starting to run into limitations.

First, the supply of investment-grade (IG) offtakers is thinning, making it harder to blend enough high-quality credit into each portfolio to satisfy risk thresholds. Second, lenders are becoming increasingly conservative, often insisting that 80% of the portfolio maintain IG status, putting pressure on developers and sponsors to rethink packaging and deal structuring.

On the utility-scale side, corporate offtake continues to grow, and virtual PPAs (VPPAs) are getting more sophisticated. Yet, the translation of credit support mechanisms in these contracts into tangible financeability remains inconsistent. Many VPPAs are signed years before a project seeks financing, and sponsors are left wondering whether credit support frameworks conceived at signing will still be adequate at the time of execution.

Conclusion: Still Moving Forward... Cautiously

The summit was rich with content, connections, and candid reflections. Deals are still happening. Innovation and adaptation are alive and well. But the specter of regulatory and financial uncertainty looms large.

What the market needs now is clarity. Certainty, even if it comes with compromise, would allow stakeholders to recalibrate strategies and proceed with conviction. Until then, the industry remains in motion, navigating complexity with the same tenacity and ingenuity that has propelled its growth thus far.

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We’re excited to support Scale Microgrids in their $275 million financing round, bringing their platform to over $1 billion raised to date.

The deal—led by KeyBanc Capital Markets, Cadence Bank, and New York Green Bank, with participation from Investec, Mitsubishi HC Capital America, and Connecticut Green Bank—will support 140MW of distributed energy projects across key U.S. states.

Energetic Capital provided credit enhancement to help enable broader lender participation and streamlined execution.

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📄 Read the full article on BusinessWire

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Thinking about your next project?
If you’re looking to unlock broader capital access through credit enhancement, we’d love to talk.

👉 Contact Us to learn how EneRate Credit Cover® can help you scale.