Investors in renewable energy projects may soon have access to the same tax advantages that investors in fossil fuel-based energy projects have had for decades. On October 25, Sens. Coons (D-DE) and Moran (R-KS) and Reps. Poe (R-TX) and Thompson (D-CA) introduced the bipartisan “Master Limited Partnerships Parity Act” (the Act) to promote private investment in renewable energy projects.

The Act would grant renewable energy projects access to the Master Limited Partnership (MLP) corporate structure whose tax advantage is currently available only to energy projects involving oil, natural gas, coal extraction and pipelines. MLPs have the dual benefit of being taxed as a partnership while its ownership interests are traded like corporate stock on a market. “The United States has the largest and most efficient capital markets in the world, yet our renewable energy companies rarely have access to those markets,” Sen. Moran stated. “In order to grow our economy and increase our energy security, sound economic tools like MLPs should be expanded to include additional domestic energy sources.”

Legislation on this topic has been previously introduced in recent years, but was never enacted.  The prospects for the Act in light of the pending tax code reform efforts are uncertain.

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Photo of Casey Kidwell Casey Kidwell

Casey provides comprehensive, streamlined legal services to startups and other high-growth companies. Casey advises entrepreneurs through every stage of business development, from initial formation to exit strategy. He draws on his personal experience as the co-founder of a medical device startup to help

Casey provides comprehensive, streamlined legal services to startups and other high-growth companies. Casey advises entrepreneurs through every stage of business development, from initial formation to exit strategy. He draws on his personal experience as the co-founder of a medical device startup to help individuals and growth-stage companies develop a strategy to implement and commercialize their ideas.

Photo of David Gardels David Gardels

An accomplished transactional lawyer, David is a trusted advisor as companies pursue growth, acquisitions, mergers or dispositions. His emphasis is renewable energy, especially ethanol, biodiesel and wind.