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Residential solar power shines on, backed by securitized lending
Residential solar is a small and rapidly expanding sector, and the securitization market—the packaging of loans to investors—has been one of the most popular sources of funding for new solar installations.
Working Paper
Measuring Climate Transition Risk at the Regional Level with an Application to Community Banks
We develop a measure of climate transition risk for regional economies in the U.S., based on the mix of firms that produce emissions in each region. To quantify transition risks, we consider the introduction of an emissions tax levied on companies emitting greenhouse gases and estimate changes in the market values of industries due to a carbon tax using Merton’s (1974) model. We find that transition risks are highly concentrated in a few sectors and counties with heavy exposures to transition-sensitive sectors. The size and geographic concentration of the tax effects depend significantly on ...
Renewable Energy Projects Present Unique Lender Risks, Need for Oversight
A vigorous risk management program can mitigate potential problems facing banks and nonbank financial institutions engaged in financing these facilities—whether as agents, loan participants or direct lenders.
Shift from utility to corporate financing for renewables presents risk
The increase in corporate power purchase agreements relative to utility PPAs means more opportunities for renewable energy developers, but it also presents higher counterparty and merchant tail risks for lenders involved in renewable energy project financing.
Low oil prices, local impact: Do depressed energy markets affect banks?
Oil prices have swung dramatically in recent years, shaped by geopolitical conflicts, evolving global demand and shifting energy policies.
Oil and gas industry shows discipline on capex, but risks remain
Oil and gas companies will likely maintain a conservative stance toward production growth, with continued focus on capital discipline and maintenance capex.