Opportunity Zones Can Drive Development Of US Renewable Energy

Forbes

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By James Ellsmoor

July 2, 2019

In the United States, Opportunity Zones (OZs) have provided developers with new possibilitiesThe race is now on to determine whether renewable energy developers can catch up to their real estate counterparts in utilizing this new tool. Opportunity Zones are defined as:

“economically-distressed communities where new investments, under certain conditions, may be eligible for preferential tax treatment.”

OZs are located in 8,700 communities across all 50 states and the 5 US territories, including 878 in California and 862 in Puerto Rico. With over 30 million people living within these areas, this incentive creates one of the largest development markets in the United States.

Opportunity Zones give both individuals and corporations the chance to re-invest existing capital gains into Qualified Opportunity Zone Funds (“QOFs”) in order to receive tax breaks for helping fund investment in impoverished areas. The tax incentive is maximized for the investor over time; the longer the investor keeps their money in the QOF, the better the benefits. This gives investors a chance to make large and lasting commitments that can improvethe socioeconomic outcomes of poor communities.

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