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Several renewable energy companies, including prominent wind industry developers and manufacturers, have formed a coalition to promote and support the Master Limited Partnerships (MLP) Parity Act.

The coalition, named Financing America's Investment in Renewables (FAIR), is advocating for equal treatment between clean energy and fossil fuels that would allow average Americans to invest in renewable energy projects in the same way they do oil and gas projects.

FAIR supports a change in the law that currently allows oil, gas, coal and other "natural resource-based energy projects, but not renewable energy projects, to use MLPs. Such a change has been proposed in the bipartisan MLP Parity Act recently reintroduced in both the U.S. House and Senate.

The MLP Parity Act, which was introduced by Sen. Chris Coons, D-Del., would give investors in renewable energy projects access to the decades-old, tax-advantaged MLP structure that is currently available to investors in fossil fuel-based energy projects, the coalition notes.

An MLP is a business structure that is taxed as a partnership, but whose ownership interests are traded on an exchange like corporate stocks. This provides the state and federal tax benefits of a partnership with the liquidity of a publicly traded company. While MLPs have generated the abundant and affordable capital that has built the nation’s modern oil and gas infrastructure, renewable energy assets are not currently eligible to use the MLP structure.

The bill would classify income earned from renewable energy sources as “qualifying income,” thus extending the MLP structure to clean energy resources and infrastructure projects. Specifically included are a broad range of renewable energy resources and technologies that are described in sections 45 and 48 of the tax code, including wind, closed and open loop biomass, geothermal, solar, municipal solid waste, hydropower, marine and hydrokinetic, fuel cells, and combined heat and power systems.

The legislation also allows for a range of renewable transportation fuels to qualify, as well as certain energy-efficient buildings, electricity storage, carbon capture and storage, renewable chemicals, and waste-heat-to-power technologies.

Notably, the group believes that the act is not intended to be a substitute for the production tax credit or investment tax credit, but complement the incentives as part of a long-term renewable energy tax policy.

Founding members of FAIR include First Wind, Vestas, Gamesa, OWN Energy, Everpower, Invenergy, Geronimo, Pattern Energy, juwi Solar and Keybanc Utility, Terra-Gen Power and TradeWind Energy.

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