Users employ bond financing for large energy projects
Tax-exempt industrial development bonds (IDBs) are an increasingly popular credit tool for financing private energy-production projects that encourage economic growth. IDBs can be used to finance cogeneration, waste incineration, refuse-derived fuel, and small hydro projects. Because they are tax-exempt, buyers accept lower interest rates on IDBs. Project financing in which the project revenues are the line of credit is attractive when potential users would be unable to back bonds with their own assets. A technical and economic feasibility study of the project and customer contracts to take the energy produced are necessary to qualify for the bonds. The more-complex projects could require put-or-pay contracts in which the supplier must either provide fuel needs or pay the user. Insurance against cost overruns is also desirable. (DCK)
- OSTI ID:
- 6015094
- Journal Information:
- Energy User News; (United States), Journal Name: Energy User News; (United States) Vol. 8:16; ISSN EUSND
- Country of Publication:
- United States
- Language:
- English
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Related Subjects
290200* -- Energy Planning & Policy-- Economics & Sociology
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
320301 -- Energy Conservation
Consumption
& Utilization-- Industrial & Agricultural Processes-- Energy Sources
320304 -- Energy Conservation
Consumption
& Utilization-- Industrial & Agricultural Processes-- Waste Heat Recovery & Utilization
COGENERATION
DEUS
ECONOMIC GROWTH
ENERGY SOURCE DEVELOPMENT
ENERGY SUPPLIES
ENERGY SYSTEMS
FINANCING
FUELS
HYDROELECTRIC POWER PLANTS
INCINERATORS
POWER GENERATION
POWER PLANTS
REFUSE DERIVED FUELS
SMALL-SCALE HYDROELECTRIC POWER PLANTS
STEAM GENERATION