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Page 2: Financing challenges and more M&A likely >> By Peter Gardett
AOL Energy Managing Editor
The 1603 program that gave cash grants in lieu of tax credits and the production tax credit that underpinned the wind industry are both on the sidelines as financiers review upcoming projects still in the pipeline. The pipeline of proposed projects is flush, but shifting priorities, transmission limitations and near-invisible overall power demand growth are weighing on a sector already struggling to compete with low natural gas prices. Biofuels are one bright area for the renewables business, in part because current mandates are not linked to disappearing tax credits and in part because large corporations have become interested in providing direct financing. In biochemicals, partnerships with large balance sheet companies like Dow Chemical or oil firms are key, US Renewables Group Co-Founder Jonathan Koch said at the recent Wall Street Green Summit in New York. "The crux of the matter is you've got to surround your project with good contracts," Koch said at the conference, an annual gathering of bankers, hedge fund and private equity dealmakers alongside project developers, business school students and media. Page 2: Financing challenges and more M&A likely >>
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