FW: What are your predictions for the evolution of the tax credit market and tax credit insurance in the years ahead? What developments have the scope to encourage or dissuade uptake?

Bunson: One question on everyone’s mind is whether the IRA will be amended in some form either by Congress or in the form of updated guidance by the Treasury department. It is possible that any such changes will favour even greater domestic manufacturing and content requirements and could also shorten the period of time that projects are eligible for tax credits. This could have the impact of accelerating project timelines which is already taking place in anticipation of such changes. Many developers are seeking to begin construction on their projects prior to the enactment of any new legislation with the hope that projects for which construction is already underway would be grandfathered under the older, more lenient requirements. This might actually increase tax credit activity over the next two years or so.

Sklar: The greater availability of financing of tax credit commitments could have the impact of reducing the financing costs and make pricing more competitive for developers able to access this market. Also, there is likely going to be more consolidation of developers to access lower costs of capital. The biggest risk to the tax insurance market is the inability of insurers’ risk capacity to keep up with the increasing market demands for tax credit insurance, something we are already witnessing in first half of 2025. This could be potentially alleviated over time by having more insurers enter the market.

Elefant: Tax insurance plays a vital role in facilitating the direct credit transfer market. Carriers are continually adding new talent to their tax underwriting bench to meet the demand for the product. We predict that the tax insurance market will expand coverage to newer technology types as more guidance is provided by the Treasury, especially in relation to the 45Z Clean Fuel Production Credit.

Edwards: We are seeing a substantial increase year over year in the number of players, number of projects and the size of projects. The advent of transferability has helped provide optionality for developers and financiers that has spurred a tremendous increase in investment. Given that transferability is a new construct, we are seeing and expect to continue to see increased sophistication in financing structures to further enhance returns for these stakeholders. Assuming no major legislative changes that limit the supply of projects, we expect the market to continue to grow and tax credit insurance along with it.

Danesh: We expect the tax credit market to accelerate over the next few years as more corporate buyers enter the market and look to offset their liability. We believe the tax insurance product, together with innovative financing solutions, will encourage more transfers on both the buyer and seller end.

Steve Bunson is an advisory director at Birch Risk Advisors, with particular expertise on structuring and global tax risks. Prior to Birch, he was a partner at Goldman Sachs where he served as global head of tax from 2000 until 2020. He holds a BA in economics from Brandeis University, and an MBA in finance and accounting from the Johnson School of Management at Cornell University. He can be contacted on +1 (212) 930 5826 or by email: steve.bunson@birchrisk.com.

Barry Sklar is a partner at Birch Risk Advisors, with a focus on advising clients on structured transactions and renewable energy risks. Prior to Birch, he was a managing director at Goldman Sachs, serving as US head of structured investing from 2007 until 2023. He received a BA in economics and mathematics from Columbia University, a JD from Columbia Law School, and an LLM in tax from New York University Law School. He can be contacted on +1 (212) 930 8604 or by email: barry.sklar@birchrisk.com.

Sheldon Elefant is a partner at Birch Risk Advisors, where he develops and executes specialty insurance structures for unique transactional risks. Prior to Birch, he served as US head of tax insurance at Willis Towers Watson. He received a BS in accounting from Touro University, a JD from Brooklyn Law School and an LLM in tax from New York University Law School. He can be contacted on +1 (212) 930 5825 or by email: sheldon.elefant@birchrisk.com.

David Danesh is a partner at Birch Risk Advisors, where he sources, negotiates and structures specialty insurance solutions globally. Before Birch, he was a lead tax attorney-broker at Alliant Insurance, and practiced as a federal and state tax attorney at Goldman Sachs, McDermott Will & Emery and TD Bank. He holds a BS in business management from Yeshiva University, Sy Syms School of Business, and a JD from Yeshiva University, Benjamin N. Cardozo School of Law. He can be contacted on +1 (212) 930 8154 or by email: david.danesh@birchrisk.com.

Brandon Edwards is a partner at Birch Risk Advisors, where he leads the team that facilitates renewable energy tax credit transfer transactions. Prior to joining Birch, he spent two decades providing solutions for corporate tax departments as chief executive of Tax Credit Co, which was acquired by Experian plc in 2021.  He received his BA in economics from the University of California, Los Angeles. He can be contacted on +1 (310) 587 9111 or by email: brandon.edwards@birchrisk.com.

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