Google will Use Tax Incentives to Expand Clean Energy Projects

Google plans to use government tax incentives to obtain financing through the sale of tax credits to support clean energy projects to further strengthen the company's $750 million in clean energy investments.

Comprehensive media reported on July 8 that Google plans to use tax regulations to inject more funds into wind energy, solar energy and other renewable energy power generation and strengthen investment in clean energy projects of US$750 million.

Rick Needham, head of Google's green energy business, said that Google has removed two clean energy investment projects and all remaining clean energy investment projects are classified as tax fair financing, taking advantage of government stimulus measures that encourage large companies to support projects that usually have yet to generate revenue. Very promising project.

"It's often part of our culture to try to find ways to make things better," Needham said. He said it was important to deploy more clean energy and deploy it at scale where it would ultimately lead to low-cost clean energy, and every deal was an opportunity to support that.

Google aims to promote technological development and new financing arrangements that will stimulate the clean energy industry and diversify sources of profit. Mark Regante, a partner at Hadley & McCloy LLP, a New York law firm that works with Google, said competitors may follow Google and give clean energy companies another source of financing. Regante said part of their motivation is basically to get ahead of more American companies. Tax subsidies are currently an important factor in directional returns for potential investors.

Renewable energy plants are eligible for tax credits, but they generally cannot use this tax credit until they sell the power and make a taxable profit. Once that is done, many businesses do not have enough taxable profit to apply all the tax credits. . By selling these tax credits, developers obtain funds to fund projects, and large tax credit purchasers can apply them to their own tax bills.

Google in June created a $280 million tax equity fund to help SolarCity Corp. pay for solar systems on its rooftops. This investment is an important enterprise, rather than a financial enterprise or unit, providing this type of financing for the first time.

Needham said, "Google is a tax fairer, and we realize that we have funds on the balance sheet, we have the ability to pay taxes, and we should pay taxes. A lot of companies may be doing the same. There are also a lot of companies that may fall into default and fill the gap to get rewards. .We will encourage them."

Needham said Google's funding decisions are based on two goals: They must generate returns and they must be innovative. "We can accept some technologies that are more advanced but people are not willing to fund them," he said. Needham said two important criteria Google uses to evaluate energy investments are the return and transformative capabilities of a particular plan or financing method given a certain amount of risk. "We wouldn't make an investment if it didn't make good business sense," he said.

Google is considering other forms of clean energy investment, which may be riskier than the projects it has invested in. Needham said one promising area was geothermal, particularly geothermal technology, which could improve resource assessments. Needham said that Google's energy focus is clearly on clean energy, and Google has no interest in nuclear energy and natural gas. "We value investment in zero-carbon emission technologies more."