How important is environmental investing? Is environmental impact a primary consideration? Or of no matter at all?
Many solar developers rightly believe first and foremost in the environmental benefits of their projects – reduced fossil fuel consumption and decades of reliable, renewable electricity. Most investors, on the other hand, appear to consider environmental benefits only after economic objectives. This, too, is an appropriate approach.
But these views need not conflict. Commercial solar can generate 20%+ returns (assuming the highest marginal federal tax rate) using modest leverage. Returns are from investment tax credit and other tax benefits so may be viewed as low-risk. These returns are particularly impressive given low interest rates and equity volatility.
We encourage investors to consider both economics and the environment: commercial solar investment is an attractive addition to high net worth portfolios.