Basis Climate closes $60m W Power & Wellhead storage tax credit transfer

Basis Climate, a digital marketplace for transferable renewable energy tax credits, has closed a $60 million transfer of investment tax credits from California-based independent power producer W Power, LLC and Wellhead Electric Company, for their utility-scale Stanton Battery Energy Storage Project.

Basis Climate co-founder and CEO Erik Underwood, said: "We're honoured to have been able to facilitate this important transaction that supports California's renewable energy transition. In a highly competitive environment, we supported W Power, Wellhead, and the buyer in transacting efficiently while understanding each party’s priorities and needs. Structuring large transactions such as these is simplified through the mechanisms of tax credit transferability, and we are proud to be an early player in this market.”

Wellhead’s president, Hal Dittmer, said: “In a complex deal environment, the Basis team provided excellent client service and transaction support that allowed us to finalise this $60 million tax credit transfer soon after the project was placed in service. We look forward to working with Basis again as we continue developing innovative storage projects."

Basis provides matchmaking between buyers and sellers of credits, and offers a transaction framework and client support to guide parties through the sale. 

The 2022 Inflation Reduction Act (IRA) created a market for clean energy tax credits by allowing for their one-time transfer to other federal tax-paying entities – thereby making it easier for developers to raise the capital they need to finance their projects. Basis has forecast the annual transfer volume of clean energy tax credits to grow to over $60 billion by the end of the decade.