The tax credits that shape the Inflation Reduction Act

Lauren Collins, a partner at Vinson & Elkins, joins the show to explain how the tax incentives in the Inflation Reduction Act stand to not only boost the deployment of renewable energy in the U.S., but also create new tax credit markets that might attract investment funds and retail investors. Collins also highlights one key area of the energy puzzle that the IRA has unfortunately overlooked.

Key Highlights

3:44 - The most important tax aspects of the bill  - PTC, ITC, Standalone Storage, Bonus credits

6:00 - The new technology neutral credit regime and leveling the playing field for smaller players

9:09 - Credit flexibility provisions (Direct pay and Transferability)

12:20 - Bonus credits and "Stacking" (Domestic Content, Energy Community and Low-Income)

17:10 - Prevailing wage provisions

19:26 - What about Hydrogen, Nuclear and Carbon Capture Utilization and Storage (CCUS)?

23:38 - Making room for Manufacturing, Minerals and Mining tax credits

26:15 - Which aspects of the IRA are overhyped?

28:21 - A new industry and marketplace for tax credits and tax professionals

29:30 - The 'missing piece' in the legislation

30:27 - Which aspects of the legislation are flying under the radar? Transmission misses out

33:30 - Bold predictions - Credit investment funds enter financial markets ... and so do retail investors!

More resources from Vinson & Elkins

Renewable Reboot: A Download on the Inflation Reduction Act of 2022 – Clean Energy Tax Provisions

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Transcript

(Note: This transcript was created using artificial intelligence. It has not been edited verbatim.)

Colin Hogan  00:14

Hello, everyone and welcome to the Modern Money SmartPod. I'm Colin Hogan.

Sean McMahon  00:18

And I'm Sean McMahon.

Colin Hogan  00:20

How's it going, Sean how has summer been treating you?

Sean McMahon  00:22

It's funny should ask Colin because I'm actually joining you today from the Great White North 

Colin Hogan

Canada? 

Sean McMahon

Yep, I'm in Canada. I'm up here with a family. And we're currently hanging out in Victoria, British Columbia, where I'm watching the ferries and the sea planes and seagulls all zoom by in and out of the harbor is pretty awesome. I gotta say, That sounds pretty cool to me. And actually, Colin, I'm glad I'm in a foreign country and a few extra miles away from you. Because I have a confession to make. 

Colin Hogan  00:52

I confession? Well what's happened here?

Sean McMahon

Well, it all started out so innocently. 

Colin Hogan

What started innocently. 

Sean McMahon  00:59

See, I was recording an episode for our renewable energy smart pod. And I was joined by Lauren Collins. She's a partner at the law firm of Vinson and Elkins.

Colin Hogan  01:06

Oh, yeah, great people there. So So what's going on?

Sean McMahon  01:10

Well, the topic was renewable energy, like I said, and all the gnarly tax credits that are in the inflation Reduction Act. So Lauren, and I were having a great conversation. She was sharing all kinds of expert insights. And one thing led to another. And we ended up talking about how all those tax credits and tax incentives might create new kinds of financial products and markets.

Colin Hogan  01:31

Whoa, that's Modern Money stuff. You cheated on me? 

Sean McMahon

Yeah. It was an accident. I swear. 

Colin Hogan

You talked about modern money without me. How could you do that?

Sean McMahon  01:44

I know, I know it was wrong. And I'm so sorry. Or I guess since I'm in Canada, I should say I'm so sorry. I didn't mean to do it. It just sort of happened.

Colin Hogan  01:52

It just sort of happened. Okay, well, was it worth it?

Sean McMahon  01:56

What do you mean? Was it worth it?

Colin Hogan  01:59

I mean, did Lauren Collins make you smarter about the impact the Inflation Reduction Act stands to have on financial markets?

Sean McMahon  02:07

Of course she did. Lauren was rad. She talked about production tax credits, investment tax credits, and the bevy of new bonus tax credits that are included in the bill. She also talked about direct pay, and the transferability of tax credits. Did you know transferability might one day lead to new investment funds focused on tax credits. They might even pave the way for retail investors to start trading tax credits on their apps and their phones, just like Robin Hood. 

Colin Hogan  02:33

Hmm. Well, it sounds like the two of you had quite the conversation. 

Sean McMahon

We did indeed. 

Colin Hogan

Without me. 

Sean McMahon

Yeah, I guess. 

Colin Hogan

Well, can we hear it?

Sean McMahon  02:44

Of course you can. I don't want to keep any more secrets between us, Colin, I want to share with you and all of our listeners what Lauren and I discussed. But first, here's a quick word from the sponsor of today's episode. ION.

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Sean McMahon  03:45

Hello, everyone, and thank you for joining me for today's episode. I'm pleased to bring on board Lauren Collins, Lauren's a partner at the law firm of Vinson and Elkins. Lauren, how're you doing today?

Lauren Collins  03:54

Doing good. Thanks for having me, Sean.

Sean McMahon  03:56

You're a tax expert. So I assume with everything going on in Washington these days, you've been really bored, not a lot to talk about, you know, not a lot of news in your world. Right?

Lauren Collins  04:04

I will say the last two and a half weeks have probably been the busiest of my career, which is really saying something. I mean, the amount of emails and calls and questions. And excitement has been a little overwhelming. I'll be honest with you, but all good things. And you know, really one of the most exciting periods, you know, as we're talking this is, this is going to be one of the most historic pieces of legislation around climate policy this country has ever seen. So super excited.

Sean McMahon  04:39

Great. Okay. Well, let's get into it. Obviously, we're going to be talking about the tax side of things today. So this bill is chock full of all kinds of incentives on that front, I want to hear from you. And you know, what are the biggest tax aspects of this bill as far as renewables go?

Lauren Collins  04:51

Sure. I'll start right at the top. I mean, I think the biggest aspects are the renewable energy tax credits and we See changes are extensions of kind of the traditional tax credits that I've worked with for most of my career. So I'm talking about extension of the production tax credits, through basically 2032, if not later, we're also seeing the investment tax credit being extended on that same time basis. And we can get more into the details. But basically, that involves an extension of the current credits through 2025. And then transition to this cool technology neutral credit regime that will get us to 2032. And beyond incorporated in that is the addition of a standalone storage tax credit, we haven't had that in the past, before, you had to basically make your storage integrated with the renewable asset to qualify, it was a pain in the butt basically. So this new legislation gives us a lot more flexibility for storage, which I don't need to tell you is so important for our grid. There's also extensions of 45 Q for carbon capture, to reduce co2 emissions, obviously very important for our country and the environment as a whole. And the amount of the credits are really expanded, they have these new bonus credits, which are novel in this legislation, and you can kind of stack them on top of each other. So the amount that you're getting back and as an investment in these technologies, is really hyped up. So it's going to bring that much more capital in for people that are interested in doing these deals. But maybe they haven't made sense economically, this legislation might turn the corner on that and make it so that they start to look attractive.

Sean McMahon  06:56

That's great to hear. So are there any sectors within renewables, you know, solar wind, you mentioned battery, are there any sectors that stand to benefit more than others?

Lauren Collins  07:04

So the cool thing about this legislation, because I actually think it does a decent job of leveling the playing field, for a lot of technologies. As I mentioned, there's this new technology neutral credit regime. This is something that's been floated for quite a while, in past years, but but never actually made it into legislation. The basic idea is that currently, the way these products have been written, there's a list of very specific projects and technologies that qualify, and maybe 10 or so things for each have the kind of production tax credit and investment tax credit, we've had to meet this narrow definition of kind of a renewable project that the government had chosen to be favored in the tax credit regime, this new legislation and the new technology neutral credit, specifically that kicks in in 2025, gets rid of that list. So there's no more of this like, you know, list of 10 or so technologies. And instead, all you have to do is I shouldn't say all you have to establish because it can be hard, but all you have to establish is that you have a zero greenhouse gas emissions rate. So certainly things like solar and wind, there's no greenhouse gases being put off by those technologies, they qualify. But there's a bunch of other stuff that could qualify, that we don't even know about, that's under development, that, you know, people much smarter than I have been working to innovate, and could be a big piece of our energy mix in the future. So instead of picking the winners and losers, it allows the market and innovators and entrepreneurs to come up with technologies and still get the benefit of these tax credits that make them more economic, and could be a game changer for our energy mix. So it's I think it's the right move for the government to make, you know, I think it's one of the smarter pieces of this legislation, you know, can also talk a little bit about the market participants, because I think there's there's a good deal of leveling the playing field for folks that want to get into the industry. And, you know, that really comes with the credit flexibility that the legislation has incorporated. So basically, you don't need to be a huge sponsor developer to take advantage of these tax credits. There's new provisions in there that would allow smaller developers to monetize tax credits and people that want to invest in these types of industries and projects, who hadn't been able to in the past can now enter the market in a way A does not so burdensome or expensive to do.

Sean McMahon  10:03

What does the flexibility of those aspects of the bill look like? Are there any thresholds that still have to be met, even though you can be smaller? What's the treatment there?

Lauren Collins  10:11

Sure. So there's basically two new provisions that get out this credit flexibility idea. There's a direct pay provision. And we saw this originally in the build that better act that was introduced late last year, the idea there is basically that instead of getting a tax credit against your income tax liability, it kind of works like a grant, you file a form with your tax return, you wait some period of time, and then the government issues you a check for the amount that you otherwise would have received as a credit in the inflation Reduction Act legislation, they change to the a bit from what was originally and build back better. And basically, they limited it, kind of really only for tax exempt or governmental entities. So that, you know, it can't be the run of the mill, tax payer, you know, your normal corporate or, you know, a developer who's out developing a project and looking to earn a profit isn't going to be able to use direct pay. But you may have municipalities or private equity funds with tax exempt owners that can now invest in these projects. And then instead of getting a tax credit, they get this quote, unquote, direct payment from the government. There's an exception to that tax exempt use rule for carbon capture hydrogen and advanced manufacturing, which is basically of manufacturing production credit. And I think that I think they kind of picked those credits to be exempt. In other words, any taxpayer can use them for 45 Q and hydrogen in particular, because it kind of gives those technologies a bit of like a testing period, where we'll let you do this direct payment. Without, you know, without you having to test out your technology, you can kind of rely on the government to finance you for at least the first five years. And then the direct payment goes away, and you have to come up with another way to finance those credits. But at least you've proven your technology by that time. The other ones transferability. This is isn't as complicated as direct fate. But I think it's much more powerful. And it may be for that reason, basically, you can sell your tax credits. So the I'm a tax lawyer, primarily have done Tax Equity over the past decade. And you know, the underpinnings of the you know, kind of law in that area, is you cannot sell tax credits. And, you know, we've worked so so hard to structure transactions, so they don't look like a sale of tax credits. And now this legislation comes out, it's like sell away, you know, final form, find a buyer, pick your price, and sell your credits. So that's incredibly exciting, not really any limitations on that. So if you can generate a tax credit, you can find a buyer, you can sell it.

Sean McMahon  13:16

Right now, looking at this bill, there's also this thing called bonus credits, can you walk us through what that's all about?

Lauren Collins  13:21

Yeah, of course. So there's there's three different bonus credits for our traditional kind of renewable energy credits that you can stack on top of the otherwise available tax credits. And those three bonus credits are basically a domestic content bonus, an energy community bonus, and a low income community bonus. So taking the ITC, for example, that's generally a 30% credit, if you happen to qualify for all three of those bonuses, probably total hypothetical, because I'll explain why that would be really hard. But if you were able to your ITC just exploded to 70%. So, you know, the government just financed your entire entire project, right. And so the specifics of each of these, the domestic content bonus basically incentivizes you to purchase components manufactured in the US. Basically, you need to make sure all steel, iron and 40% of components that make up the facility, have the manufacturer or producer mind in the United States. This is one that people can kind of structure into or opt in to. I know that people are talking to their suppliers and manufacturers and trying to figure out if they can qualify Is there enough stuff being made in the US that they can incorporate into their object because you get an additional 10% credit, which, which is a lot, you know, it just becomes a cost benefit analysis. If I have to pay X amount more for to be made in the US, but I make x plus y, as the tax credit, I'm going to make that decision and all by in the US. So those conversations are happening, I think that we will need to catch up a little bit, we need more US manufacturing for this to be possible for people to take advantage of on a large scale. But I think we'll get there. The other two, two bonuses. They're kind of like get lucky bonuses, you know, do you happen to be located in certain communities, and certainly going forward, people will decide to, you know, maybe make their project in that specific community, but there'll be a lot of considerations at play. And again, there's a it's an energy community bonus, which is one of them. That's another 10% bonus. And basically, that is a bonus for locating your project in either community that has traditionally been like an oil and gas or mining community, and maybe a coal mine closed within the past 20 years. So if you now install renewable projects there, you'll get an additional credit, it was also expanded so that it included projects that are located in communities with unemployment above the national average. So you can see basically, they're they're incentivizing you to develop or construct your project and an area that needs some revitalize revitalization. Or, and maybe there's some displaced workers who are working in a traditional energy sector. And now we're going to bring in a renewable project. And we're going to, you know, build jobs, you know, high quality, good paying jobs through renewable. So, you know, we're gonna give folks a 10% additional tax credit for being located in that community. The third one, the low income community bonus, this is only really available for small projects. So it'll be of limited import for a lot of developers. But certainly, it'll encourage development in low income communities thing is like a five megawatt limit on those projects. But that can be 10, or 20%, depending on where you're located. But again, kind of encourages people to bring these projects which bring jobs and revitalize the neighborhood, into certain areas.

Sean McMahon  17:52

Alright, so I can see you're talking about by stacking those all together, it does kind of bring in smaller players, right, smaller projects, and a low income community that was, you know, previously oil and gas, all those things. So that makes perfect sense, right, and

Lauren Collins  18:05

it all goes hand in hand with this overall kind of policy objective of kind of leveling the playing field, right. And we don't want to leave people out. We don't want communities to be left behind or, or workers that have been displaced, to continue to be, you know, out of these these great industries that do provide high paying, you know, quality jobs. And I'd be remiss to not mention that there are some added requirements on a lot of the tax credits around labor. And basically, they require that if you want the full credit, you have to pay your laborers and mechanics who are constructing, and operating and maintaining the project, a prevailing wage, and that's basically like the Davis Bacon act wage. The Department of Labor sets it based off of locality. So it ensures that, you know, we're not just giving tax credits to giant developers, we're making sure that they're paying the people, they're doing the good work of developing these projects, a prevailing or good living wage, you also have to employ apprentices in the development and construction of these projects. So it's ensuring that we're paying folks well, and we're training people, and you have to be part of this apprenticeship program that is available in this country. And so it's bringing more workers into the fold and training them, you know, again, in this kind of, you know, great burgeoning industry.

Sean McMahon  19:42

We'll be right back.

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Sean McMahon  20:22

Now back to my conversation with Lauren Collins from Vinson and Elkins. All right now, you mentioned earlier 45 Q and hydrogen. So I want to talk a little bit about how this bill impacts sectors like that, you know, hydrogen, CCUS, and nuclear, you know, how does it treat those technologies? Because we spent so much time talking about wind and solar and battery, but, you know, what's the treatment? And those areas?

Lauren Collins  20:43

Yeah, some of this will remain to be seen, right. Like, I think those technologies, you know, carbon capture has been around for quite a while, right. I think there's, there's a fair bit of technology developed there, though, it certainly has room to go to grow hydrogen and nuclear, you know, I, I wouldn't try to venture a guess as to you know, how big of an impact it will have, it will have an impact. We have deals that we've been working on, you know, over this year in the hydrogen space in particular, that were basically go no go, depending on whether legislation of this kind got enacted. And you know, what, it's been a month since Manchin said you wouldn't vote on any sort of climate change legislation. So all of those deals went away, you know, folks figured they'd go back to their corners and lick their wounds and figure out what they were going to do. All of those deals get to come back now. And now, you know, these development stage hydrogen projects, have a hope, you know, they can now be economic, because there's this potential for this powerful tax credit. So if I'm certain it will cause hydrogen projects to be developed that would not otherwise be developed. I hope it's a lot of hydrogen projects, we'll see. Nuclear. I mean, this is another one where I've been doing this for a decade, never seen a nuclear deal. You know, I'm sure people have done them. I haven't seen them. But now with this credit, I think we're gonna see them, you know, I certainly hope that we see them, I hope we see them in the near term, I think nuclear, you know, is and should be an important part of our energy mix. It's done responsibly. So hopefully, it resurrects that market a bit. And, you know, again, with things like transferability of their credit, I think it makes it more economic, and opens up the market for people that might be interested in investing in nuclear. And then as far as carbon capture, I mean, certainly people were doing carbon capture deals on the basis of the existing credit that had been in place for a while now. But the legislation increases the amount of the credit significantly, and it lowers the threshold for when you qualify for the credit. So not only do you get more credit, but there'll be more projects that can qualify more easily. So expand the scope of projects that otherwise wouldn't qualify, or, frankly, we were having to like over structure or spend a lot of legal time and analysis to figure out if we could shoehorn them and one of the, you know, various rules. Now the path to qualification is a lot easier. So it's the same thing deals that were kind of on the fringes or development stage projects that may maybe they didn't kind of pencil out, now we can go back to the drawing board, rerun the numbers, and those deals start to work again. So you know, all of this is to say is, I think the legislation will do what it's intended to do, which is encourage and promote development in these areas. So that we're not just reliant on solar and wind and traditional energy sources. Because if you look at product, you know, projections of our energy needs in this country, we will not have enough if that's all we're relying on. We need to have a really mixed, you know, stream and source of energy, if we're going to have any chance of meeting our needs, and doing so in a responsible manner to

Sean McMahon  24:38

so now we've all been hearing a lot about, you know, supply chain issues, and you know, the growing concern about you know, precious metals and their availability. So how does this bill you know, tackle manufacturing and minerals.

Lauren Collins  24:47

So there's one, one big, really important provision that is directed at this idea, and specifically domestic manufacturing. Production and mining of minerals. And that is the advanced manufacturing production tax credit. Essentially, what this this provides is that if you manufacture produce or mine, either certain renewable energy components are certain minerals that are used in these technologies in the US, and you then sell them or they're incorporated into a larger component or facility, you get a tax credit, per component or kind of per unit of mineral that had been mined and produced. So, you know, we're having conversations with people that are, you know, manufacturers and miners even, which is fun, you know, I didn't think I'd be having client calls with miners. But you know, here we are. And basically, they are looking to take their offshore operations, and move them to the US. These are like real time live conversations we are having, because this legislation and the credits that are in there, make it attractive to do so. So the policy goals of increasing domestic manufacturing, and making the labor market more competitive in these types of manufacturing jobs and mining jobs, it is in process, you know, I'm seeing positive movement in this area, which is very exciting. And on top of that, so there's this important manufacturing production tax credit, there's also incentives for people to buy this stuff. So the manufacturers get a credit from the government when they produce it. And then on the flipside, the buyers of these various renewable components and facilities, they get an additional tax credit if they're buying that stuff that has been made in the US. So there's a two sided benefit for both parties. So it really incentivizes the entire market to find a way to make us manufacturing work.

Sean McMahon  27:15

Alright, now, I want you to step back here real quick. And, you know, you've been covering the sector and working in a sector, I should say, for years and years and years. And I'm sure you follow the way that this legislation has been, you know, talked about and written about in the media. Are there any aspects of it that you think are overhyped?

Lauren Collins  27:31

Oh, hopefully you can tell I'm really excited about this. And like if anyone's overhyping it, I am completely guilty. I think you'll hear a lot of people say that the direct pay and the transferability provisions are overhyped. I, you know, I've seen a lot of stuff in the press about, you know, are they really that beneficial, they might be kind of hard to administer, you're still going to have some residual, you know, recapture reCAPTCHA other liabilities that people need to worry about? Yeah, sure. Whatever. No. When you read that stuff, always check your source. I feel like so much of the time, it's, you know, Tax Equity attorneys like myself that are throwing water on these programs. And I think that's a mistake. I do think that these programs are going to be incredibly important. I don't think they're being overhyped. So I'm answering your question in the negative. But I think that, you know, as with the legislation, providing a more expansive set of rules for types of projects that qualify, you know, we also have an expanded set of people who want to be involved or will want to be involved because of this legislation. And I think there's going to be room for everyone. So the traditional Tax Equity structures that I've been doing for a decade, they will continue, there's a huge place in the market for that. It's an important source of financing. It's a pretty efficient source of financing. So I think, you know, folks like me, who have built their career on it can sleep easy at night, no need to panic. But there's also going to be this whole other developing, basically, industry and marketplace for tax credits. And I think we need to make sure that we're being innovative. And, you know, tax lawyers in particular, we can't get stuck in this, you know, one track mindset of, we like tax equity, let's stick with it. No, I think we need to be innovative. I think we need to think about ways to make direct pay and transferability work, because if we can get it to work, I think it only helps the industry and the marketplace. And you know, just as a human being like our client MIT and the world. So I think we need to spend a lot of time focusing on it. I will say there's there is an important limitation. I think that the the legislation wanted to make it easier for tax exempt and like state and local governments to invest, as we talked about earlier, they they're able to do direct payment of the credits, which I think was it was an important, you know, goal, and a smart move on the part of the government. But there's a missing piece in the legislation that I think is going to make it hard for private equity, which is typically, you know, oftentimes how tax exempt actually invest in these things. To actually use that direct pay. I think there's a legislative fix that that we should explore, that could tamp down some of the ability for tax exempt and kind of Munis to invest. I don't think it's insurmountable. But it will take some work on behalf of, you know, tax lawyers, maybe lobbyists to try to get those rules to work in such a way that they were intended.

Sean McMahon  31:12

Lauren, are you suggesting that the private equity crowd was left out of a piece of legislation?

Lauren Collins  31:18

I would never suggest that. I think they they made out pretty well.

Sean McMahon  31:23

Gotcha. All right. Well, I'll take that last question. And just and just flip it around. So are there any pieces of this legislation? You know, it's massive, it's, you know, $370 billion of climate aspects. Are there any pieces of it that are kind of flying under the radar that you think could have a bigger impact? And then people understand? Yeah, well,

Lauren Collins  31:39

I'll say what I think is, is missing that I don't think people are focusing on enough. And that is the lack of any sort of transmission tax credit, the built back better legislation had a transmission tax credit, it did not make its way into the IRA. I have no idea how it seems like a ginormous mistake. You know, and I don't want to overstate it. But it seems foolhardy to have this incredible legislation that by all accounts is going to result in you know, a flood of capital, two times or five times installations of renewable resources. And our transmission grid isn't going to be upgraded. I mean, you know, how does that work? You know, I goodness, I'm not an engineer. But you know, just sitting back and seeing the types of constraints our transmission grid has now. I'm worried that we've created this legislation. That sounds great. But how do we actually get the energy to our homes, on our current grid, we do have the standalone storage tax credit, I know that will encourage more storage to be developed. That'll be a piece of the puzzle. But we've got to figure out this transmission thing. We need to incentivize people to upgrade the transmission grid, find ways to make it economic, you know, provides, there's like some grants in there, they're kind of throw away. I don't think they do much. We need more transmission attention. In order for this to actually kind of play out the way we hope it will. That kind of related thing is there's a solar PTC option. So previously, if you are developing a solar project, you are going to take an investment tax credit on it. Now you have an option of switching to a production tax credit. And I think a lot of people will will make that election, you know, we're hearing as much as two thirds of solar projects will probably be a solar PTC deal. Now. I think that could also put some additional constraints on our transmission grid and encourage more negative bidding. So you know, I, you know, I said earlier, I was super optimistic and you know, overhyping things. These are some areas where, you know, there's not enough attention on they're kind of missing from the legislation. I hope they're fixed. I don't know that we're gonna have enough time, you know, just with, you know, midterms coming up in the light.

Sean McMahon  34:31

All right. And one of the things we like to do on the show is ask our guests for bold predictions. Right. And so do you have any bold predictions, you know, five or 10 years from now, when we look back at how this legislation is performed in the real world? What are we going to see?

Lauren Collins  34:43

I hope we see this playing out the way that we expect. I mean, as I mentioned earlier, I think that folks are predicting like $3.5 trillion of capital investment. Wind is supposed to double and installations year over year, solar is like five times. So I hope five years from now we kind of look back, and we're like, this had kind of worked, right. And we're starting to see, you know, five years from now we should be seeing these projects starting to go in service, we should be starting to see our energy mix more diverse. You know, hopefully, we'll see some hydrogen projects really get off the ground. You know, there's projects we're working on now that are kind of a mix of everything. So you'll have one major project that has a wind piece and a hydrogen piece and a carbon capture piece. And it's moving from one state to the next. And our grid is kind of not so compartmentalized. I hope. That's what we see, I think this transmission thing is going to be a problem that that again, worries me, I think we got to figure that out somehow, I think storage may be kind of the gap fill for a while. I also think I keep harping on transferability. Because I think it's so cool. I think we're going to see kind of these, like credit funds develop, where basically, we'll have, you know, a be a fund essentially, buys credits from developers, and it will have a variety of investors who've invested in the Fund, and are able to take advantage of tax credits in exchange for their investment. I think they'll they'll then be kind of a marketplace for credits, you know, though, I don't want to do like an ETF for tax credits, but you know, something like that, right. And we've been getting a lot of questions of how much are these things gonna go for? How much is a tax credit? What do you think you're gonna sell it for? I don't know. They asked the tax lawyers, and then we're, you know, we're always like, Yo, you guys, this is people, you, you tell us with our gonna trade floor, it'll depend on asset type, it will depend on credit worthiness of the sponsor developer, it will depend on the relationship between the parties, but there will be a market for these credits. I'd like to see, you know, folks like you and I being able to invest in credits like this. We can't right now the way that the rules are written, I, if I'm gonna make a bold prediction, it's that, you know, within the next five years, they'll get rid of that limitation. So hopefully, you know, folks like you and I and others who are interested in this industry, we can invest and why not right. You know, if you can invest in cryptocurrency, why not invest in a solar project in Arizona or wind project in West Texas? Or maybe not, but you know, pick your asset, hydrogen, whatever, I think that would be an incredibly cool place for this to go. Now, you can imagine like having an app on your phone of, you know, your fun, where you invest in renewables all over the country. That would be pretty rad.

Sean McMahon  38:09

Yeah, rad indeed. I love that word. I've been trying to bring that word back. So yes, that sounds like sounds like a pretty awesome future. Hey, Lauren, I really appreciate your time and covering all this. Your insights been wonderful. So thanks a lot for joining me today.

Lauren Collins  38:23

My pleasure. Thank you.

Sean McMahon  38:27

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