Steve Coughlin: Yes. Julien, it’s Steve. So definitely, we have the lion’s share of our tax attributes are from investment tax credits and will continue to be. So — and I would say when we look at the investment tax credit with the profile of when projects are coming online, it is roughly fair to say about 2/3 of the investment tax credit gets recognized in the year of the commissioning and then about 1/3, 30% in the second year following commissioning. So that holds. The total volume of tax credits will grow annually, and we expect as the portfolio grows. So we’re targeting the commissioning of about 2.1 gigawatts this year of U.S. renewables, say that doubles next year, I would expect the volume of tax attributes to roughly follow that same growth rate.
So a doubling of the tax credit from this year to next year, just as it doubled from last year to this year when we went from 1 gigawatts to 2 gigawatts. The production tax credit is a good incentive in some or a better incentive in some projects. Typically, it has been in wind. But in some cases now where we see an energy community adder now that we have some clarity on that. And we see the potential for domestic content adders with the investment tax credit. Keep in mind, those adders are actually richer on the investment tax credit than they are on the production tax credit basis the way the higher was written. So we — there’s a bit of an offset there in that some projects where we have a very healthy pipeline, good opportunity to get these bonuses, the investment tax credit may still be the best option.
But we’ll look at that project by project and look at what yields the best returns. But I see very strong growth in our tax attribute number year-over-year going forward.
Julien Dumoulin-Smith: Right. But the point is your ITC, you’re still vastly weighted towards ITC versus PTC, right, as you have been and you don’t intend to change that necessarily, especially given your commentary here. I just want to make sure there’s been some concern otherwise.
Steve Coughlin: Yes. Vastly. And the vastness of that will be clear on Monday when I show you the tax credit breakdown between ITC and PTC. And then also keep in mind that for our backlog we’ve essentially locked in already that election and who that tax equity partner is going to be. So for the next couple of years, it’s pretty well decided.
Andres Gluski: The one thing I would add on the… Julien, so we’ll be doing more wind in the states, which will be PTC. So for example, the project in Texas is 900 megawatts of wind. So yes, we’ve been more towards ITC partly is because we’ve been very heavily in solar. We’re very strong in solar. Over time, we expect more of a balance.
Julien Dumoulin-Smith: Right. And then on just the backlog adds, I know you said it’s lumpy, but is domestic content is one of the reasons why customers aren’t moving because they don’t have guidance from treasury yet and so therefore, holding folks back? We’ve heard this from some folks.
Andres Gluski: Yes. I mean in our case, not really. I think I would point to that. It’s just we’re in some negotiations for some whales. And when we land them, it will come through. What did happen last year because of the OXi tariff circumvention case that did delay projects. It did delay projects and set them off into, let’s say, a longer time horizon than would otherwise. But again, since we do a lot of bilateral negotiations, and we haven’t had any problems with our supply chain. That is not what’s driving it. Where the domestic content issue does come in is in terms of the $6 billion contract we have for domestic manufacturer of solar panels here in the states. And so obviously, what’s key there before sort of sitting on the dot line is what is domestic content.
