Update 03/05: The Deadline for comments has been extended to March 15, 2024.
Opportunity Title:
Request for Information Regarding the Manufacturing Capital Connector
Funder/Agency:
DOE
Description:
The Department of Energy (DOE)’s Office of Manufacturing and Energy Supply Chains (MESC) is considering establishing a Manufacturing Capital Connector (MCC). The goal of the MCC is to facilitate the commitment of private sector capital necessary to bring important clean energy manufacturing projects to commercial operation.
The Department of Energy (DOE or the Department)’s Office of Manufacturing and Energy Supply Chains is issuing this RFI to notify parties of its potential interest in initiating a Manufacturing Capital Connector (MCC) to support applicants seeking clean energy manufacturing funding opportunities and/or tax credits. The Department also seeks input from all stakeholders through this RFI to help gauge the interest in and to inform the overall design of the MCC.
To help inform the interest in and design of the MCC for clean energy manufacturing programs, DOE is seeking public input on the potential structure, benefits, and risks of the proposed MCC from potential capital providers and clean energy manufacturing program applicants or selectees.
DOE specifically welcomes comment on the following questions:
For Applicants or Selectees:
1. What impediments do you see in DOE providing applicants and the public with information about private sector capital providers interested in financing clean energy projects?
2. Would you be more likely to apply for a grant, tax credit allocation, or other Federal funding, if you knew that a list of private sector financial institutions interested in financing clean energy manufacturing projects would be available on a publicly accessible DOE website?
3. What information would be most helpful to have from interested private sector capital providers?
4. Does the establishment of the MCC potentially increase the speed at which you can develop your project?
5. Do you anticipate your organization would review the list of interested private sector capital providers and/or would your company be likely to share your application materials? Are there any materials typical to a Federal application that an applicant would not be willing to share with private sector capital providers?
6. Do you foresee risks to the involved stakeholders in leveraging already provided application materials with applicants directly sharing information with private sector financing? What are those risks and how could they be mitigated in the creation and operation of the MCC?
7. What Best Practices should private sector capital providers offer in order to participate in the MCC?
8. What types of capital and support from private sector financial institutions does your project need to proceed forward to commercial operations? For example, if your project is seeking the 48C tax credit allocation, would your company need support in monetizing
the tax credits?
For Potential Capital Providers:
9. Would your institution have interest in participating in the MCC as described in (or similar to) this RFI and have information about your interest available on a publicly accessible DOE website?
10. What is the most effective way DOE could catalyze private sector investment into clean energy projects? Are there alternatives to the MCC that DOE can provide to achieve the same goals? Are there other tenets to the MCC that DOE should try to include?
11. What is the most effective way DOE could educate private capital providers on Federal clean energy programs in order to facilitate private sector investment?
12. Financial institutions interested in financing clean energy projects such as those that apply to 48C need to evaluate projects in a timely manner and commit to deploy capital. What are some Best Practices your institution would be willing to offer in evaluating clean
energy manufacturing projects? For instance, would private sector capital providers commit to finance a certain amount ($) or number of projects, respond with a term sheet in a certain number of days, and/or commit to a percentage of viewed opportunities, within a range of parameters (e.g., interest rate, tenor)?
13. Application overview and information sharing (for reference, DOE funding opportunity announcements often require a detailed application narrative, workforce and community benefits plan, data sheet, an appendices that include a financial model, financial statements, and offtake/sales agreements):
a. What information and documentation are most pertinent for a financing institution’s decision? Is there further information that your institution may need to make an investment decision?
b. What are industry best practices for protecting applicants’ privacy? How can private sector financial institutions seeking to participate in the MCC demonstrate that they have appropriate safeguards in place to prevent the release of confidential business?
14. Questions regarding Capital Provider’s Best Practices:
a. Based on the three topic areas noted in the 48C Case Study, is your institution interested in all/most of the three topic areas? If not, please specify topics areas that are not of interest.
b. What part of the capital structure would your institution be interested in participating in (e.g., senior secured, mezzanine, preferred equity, common equity, tax equity (original investment or subsequent transferability), other)? Please outline all structures of interest.
c. What is your typical minimum and maximum investment amount, advance rate, and tenor on an investment in these topic areas?
d. Is there a minimum or maximum number of projects your institution would be interested in financing?
e. How much capital would your financial institution be potentially willing to make available to projects via the MCC?
f. Does your institution require a type of revenue/offtake contract? If so, what kind, what tenor, and for what percentage of the output? Please provide as much detail as possible.
g. What balance sheet metrics (e.g., liquidity, debt-to-equity) does your institution look for in the project and in the Sponsor of a project?
h. What terms (e.g., interest rate, DSCR, tenor, maturity) would your institution potentially be willing to provide as one of the private sector capital providers?
15. What would enable a capital provider to view eligible clean energy manufacturing projects, such as 48C projects, as a portfolio versus one-off projects? Would viewing as a portfolio lower the cost of capital from your institution?
16. What would be the potential sources of your capital? Would your financial institution be using existing funds, or would they raise outside capital?
17. Do you foresee risks to the involved stakeholders in using the MCC to find potential manufacturing projects to finance?
Deadline:
Written comments and information are requested by March 4, 2024.
Update 03/05: The Deadline for comments has been extended to March 15, 2024.
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