In this article for Greentech Media, Louis Berger explores the pros and cons of yield companies (YieldCos) as an investment vehicle for renewable energy projects. “A YieldCo is a corporate structure where the income component (generated by the underlying assets) is emphasized,” explains Berger, co-founder and partner at Washington Square Capital Management. The companies “use completed renewable energy projects with long-term power purchase agreements in place to deliver dividends to investors.” By transferring their renewable energy assets to YieldCos, “power producers are attracting interest from two types of investors who may not have been interested otherwise: socially responsible investors and income investors.”
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