Plenty of clean energy developers safe harbored equipment in advance of the One Big Beautiful Bill Act (OBBBA)’s passage in July 2025.

The legislation cut the developer’s ability to the full benefit of federal tax credits for solar-and-wind projects to support at least 30% of a project’s costs, starting from July 4, 2026, from a 10-year runway originally introduced under the Biden Administration’s Inflation Reduction Act (IRA) in 2022.

However, not every project was going to be safe from this rapid compression and this resulted in an avalanche of deals in recent months where developers sought corporate loans to include pockets for equipment finance, particularly as the safe harbor guidance came out at the end of the summer, while also turning to private credit as the bank market started to hit its own limits on project finance.

Exus Renewables and Heelstone Renewables, respectively, announced deals last month, respectively, where equipment financing was specified as a specific use of each facility.

“Developers are now doing a little more thinking about where they’re getting their capital for equipment financing,” said Kiera Brown, an Associate at Macquarie.

Interconnection reform, the resulting high interconnection fees in bigger grid operators such as PJM and MISO, tariffs and finally sunsetting tax credits were amongst the reasons for projects getting withdrawn. NPM Interconnection queue data said there over 2,200 applications for solar-and-wind projects in the US that were withdrawn, starting from January 2025.

The data also identified 569 pre-operational solar-and-wind projects, across 155 GW, which reached an advanced stage, since January 2025, and have not been withdrawn from the queue. In addition, the rise of AI data centers has also led to more commercialization opportunities and allowed projects to advance.

This has led some developers to be challenged by both the shortage of equipment, as well challenges in procuring that equipment with longer lead times.

“We’ve definitely seen private capital try to do some creative things on the equipment finance side to help IPPs get their pipelines and inventories on equipment to a robust place,” said Daniel Sinaiko, Partner, Project Development & Finance Practice at Latham & Watkins.

How capital is being deployed now

Developers are trying to secure funds at faster pace than before to get ahead of market challenges. Despite these changes, the private capital market is willing to deliver.

Latham & Watkins Sinaiko said that he’s seen the private market come up with creative solutions to try to get capital to developers despite current market challenges.

“We’ve seen some scenarios where you’re bringing kind of blended solutions with equity capital and debt capital to the table,” said Sinaiko.

In addition to traditional equity kickers – where lenders get a piece of the project portfolio – he’s also seen lenders provide loans to companies with a higher risk portfolio for corporate equity.

A notable shift in equipment financing is that lenders have been allocating a higher percentage of the total capital loan to securing equipment.

“We maybe see a maximum of 20% of total project loans going to our larger development facilities,” said Macquarie’s Brown, noting that this number has increased over the years.

Equipment deposits have also gotten more expensive.

“Deposit schedules have changed a bit. Equipment suppliers are requiring more money upfront. That’s also lending to a shift in more capital deployed into equipment, added Jorge Rodriguez, Managing Director, Debt Capital Markets at Marathon Capital.

Sinaiko said that lenders are also willing to support projects further down the pipeline, even though projects are getting delayed due to equipment issues.

“If you have a particular project that is contracted where you have a very strong case for the deployment of the equipment, I think you can get people fairly comfortable that even if the equipment’s not going to arrive for a couple of years, that capital can be provided” said Sinaiko.

Another shift lenders are seeing is more clients trying to jumpstart multiple projects at once due to the OBBBA.

“We’re seeing a lot more clients raise corporate facilities, holdco facilities and minority equity support (MES) facilities to help kind of fill out that capital stack where they’re to help spread their equity further and allow them to do more projects kind of at once with the same equity dollars,” said Rodriguez.

Rodriguez and Sinaiko said that while each lender is willing to provide varied loan amounts for different projects, lenders have been increasing leaning towards funding thermal storage and data centers to address the rise in demand for those types of projects.

“Capital continues to be available for experienced developers with strong fundamentals, and there’s still a lot of interest in well-structured projects. While the market has its complexities, the underlying demand for quick access to inexpensive, clean, reliable power remains very strong, and that continues to support investor appetite across the sector,” according to an Exus spokesperson.

*This story was originally published exclusively for NPM subscribers.