Tax Credit Transferability Takes Center Stage: Panel of Industry Leaders Spotlight Standardization, Market Maturity, and What Comes Next
Just before Thanksgiving, ACP Chief Policy Officer JC Sandberg led a discussion between industry experts — Clearway’s Chief Financial Officer Steve Ryder, Crux Co-Founder and CEO Alfred Johnson, Orrick Partner Alejandra Garcia Earley, and Norton Rose Partner Hilary Lefko — all of whom underscored the increased urgency to grow the available pool of tax equity and the opportunity tax credit transfer deals represent to help accomplish that goal.
As the clean energy industry accelerates project deployment nationwide, the ability to transfer federal tax credits has become one of the most consequential financial tools for shaping project finance. With billions of dollars in transferable credits circulating across technologies — from solar and wind to manufacturing, storage, and nuclear — standardizing these credit transfer transactions can help attract new investors. ACP convened leading developers, legal experts, and market innovators to explore the state of play and introduce a new standardized Investment Tax Credit (ITC) transfer agreement form.
Key Takeaways
- The market for buying and selling clean-energy tax credits is growing fast: Tax credit transfers have scaled dramatically — from under $10B in 2023 to an estimated $40B this year — and are diversifying beyond wind and solar.
- ACP and industry partners have introduced the new Tax Credit Transfer Agreement (TCTA) to make deals more accessible to a broader range of market participants: While every deal has a handful of unique attributes, a great many transfer deals can benefit from a standard template that incorporates provisions common to most deals. The new TCTA form presents tax credit buyers and sellers with a common starting place to transact transfer deals. ACP’s goal in creating the form with its industry partners is to make the form broadly available and widely used similar to the ubiquitous ISDA framework for derivative transactions.
- This is just the first step — more standardized tools are coming: Experts expect similar templates for other credits like 45Y production tax credits and 45X manufacturing incentives further expanding the pool of potential tax equity investors. As these tools roll out, buying and selling credits should become easier, helping clean energy scale more quickly.
A Growing Tool for a Growing Market
“The market is only two years old,” noted Johnson — yet it has matured at remarkable speed. In 2023, an estimated $7–9 billion in credits changed hands. In 2025, that number will exceed$40 billion, with especially strong growth in battery storage, clean fuels, manufacturing, and nuclear energy. Large developers like Clearway report that traditional tax equity remains strong, but transferability has become a crucial supplement — particularly after IRS guidance and safe harbor rules helped clarify how deals should work.
According to Orrick’s Alejandra Garcia Earley, demand now spans nearly every available tax credit category — from 45X manufacturing incentives to EV charging credits — demonstrating just how central transferability has become in financing new infrastructure.
Corporate Buyers Are Fueling Liquidity — and Raising the Bar
An ever-increasing number of new corporate buyers are entering the market, oftentimes with little prior experience in clean energy finance. Unlike banks or traditional tax-equity investors, these companies often do not have in-house tax teams or transaction lawyers with the necessary experience in these specific transactions. As Norton Rose’s Hilary Lefko explained, “These buyers tend to lean heavily on counsel, third-party advisors, and insurance rather than deep project-level diligence.”
This evolution is healthy — it means the market is expanding — but it also reinforces why consistent documentation and predictable processes are needed. As Johnson put it, “First-time buyers want to transact on something tested, known, and accepted across the market.” Without those guiderails, buyer uncertainty risks limiting the pool of new market entrants at a time when they are desperately needed.
A Standard Transfer Agreement — Designed for Speed and Confidence
As the tax credit transfer market has grown, nearly every deal has required bespoke contract drafting. This has served as a market constraint. The new TCTA form aims to eliminate that constraint by reducing up-front transaction costs, shrinking timelines and encouraging consistent deal terms.
“People want to move fast,” Clearway’s Ryder said, emphasizing that developers and buyers alike benefit from reducing the amount of time spent repeatedly redlining the same provisions. The template gives parties a commercially balanced, middle-of-the-road starting point that reflects market norms to serve as a fair baseline informed by hundreds of completed transactions.
The document is intentionally flexible: it works for single-asset ITC transactions today, but can be adapted for portfolios, production credits, or other emerging incentives.
Driving Scale Through Standardization
Panelists repeatedly highlighted that standardization is not just administrative — it is foundational for market growth. When parties start from a shared baseline, legal negotiation shrinks, deal timelines shorten, and more market participants can enter with confidence. That makes investment cycles more predictable and helps reduce transaction costs — particularly for smaller sellers or first-time buyers where those costs might otherwise consume a disproportionate share of deal value.
Johnson estimated that the total cost burden on credit buyers and sellers can reach 3–7% of deal size, meaning efficiency improvements directly translate into more dollars available for additional deal flow to facilitate clean energy deployment. Standardization also allows technology platforms to automate parts of the process, bringing further speed and scale to the market.
What Comes Next: PTCs, Manufacturing Credits, and Technology-Neutral Standards
The consensus among these experts on next steps was clear: more standard templates are coming. Ryder pointed to the rising level of public and political support for domestic manufacturing credits like 45X, making that an ideal area for document standardization.
Panelists also argued that 45Y production tax credit transfer deals should be standardized soon, since only minor revisions are needed once revenue recapture and timeline provisions are adjusted. Garcia Earley explained that once a PTC version is created, it will be relatively easy to adapt across multiple emerging credit categories including 45X, 45Y, and similar incentive frameworks.
Turning Industry Collaboration into Market Acceleration
In closing, ACP’s Sandberg underscored why this work matters: the ability to monetize credits efficiently is now central to financing clean energy projects and a key component to continue deploying enough clean energy to help meet skyrocketing demand for energy. The new agreement reflects months of collaboration among sponsors, financiers, lawyers, and market intermediaries — each contributing to a shared document that lowers barriers to entry to the tax credit transfer market and encourages wider market participation.
As Ryder put it, “We invested the time because we care about where the industry is going. These transactions need to happen efficiently for clean energy deployment to continue.” The form is now being released publicly through ACP so that developers, buyers, platforms, and institutions can adopt it widely — similar to other industry templates like ISDA agreements in global derivatives markets.
Tax credit transferability has become a core financing mechanism supporting America’s clean energy buildout. The TCTA form is designed to help buyers and sellers move with more speed and certainty as billions of dollars of capital flows through the system. And as Sandberg reminded the industry, standardization is not the end of innovation — it is the key to unlock it, paving the way for broader participation, lower barriers to entry, and the next wave of market expansion.
Watch the full discussion here.
