New Energy Risk (NER), a specialist managing general underwriter and a wholly owned division of Paragon Insurance Group, has announced its first tax credit insurance transaction, in partnership with the tax insurance broker at Alliant Insurance Services.
NER has bound its first tax credit insurance policy to support a utility-scale solar project in Texas. The project aims to provide clean electricity capacity to support a large data centre, part of a growing number of renewable energy projects designed to meet the burgeoning power needs of US data centres while aligning with corporate clean-energy directives.
With this transaction, NER says that it plans to deliver capacity to the tax credit insurance market by combining its tax and technology underwriting expertise to offer comprehensive insurance solutions addressing the technology-related risk elements of tax credit transactions, particularly those involving Section 45 and Section 48 credits.
NER explains that tax credits have long been a cornerstone of clean energy development. The Inflation Reduction Act of 2022 enhanced the role by enabling transferability of credits and expanding the pool of capital for renewable energy projects – creating greater demand for insurance to support these transactions.
George Schulz, Chief Executive Officer, NER, commented, “We are extremely pleased to announce our first participation in a tax credit insurance transaction. This success reflects months of dedicated effort and a logical extension of NER’s capabilities in supporting the clean energy industry. We appreciate Alliant for their leadership on this transaction and our insurance partners for their continued support of NER’s work to deliver innovative, large-scale performance insurance solutions for breakthrough technologies.”
Dan Schoenberg, Executive Vice President, Alliant Mergers & Acquisitions, added, “Alliant is pleased to welcome NER into the tax insurance market and extends our sincere appreciation for the valuable support they provided to both our firm and our client. We look forward to strengthening our collaboration with NER and their insurance partners in the years ahead.”
Kevin Broich, Executive Underwriter, Tax, NER, said, “With the passage of the One Big Beautiful Bill Act, as well as subsequent IRS guidance, administrative uncertainty surrounding the transition tax credit landscape has eased. In the coming years, tax credits will remain available to finance a wide range of clean energy solutions, including emerging technologies. NER is building a platform to support the rapidly expanding demand for insurance and the need to demonstrate and scale innovative technology solutions.”
