Financial Transcations & Due Diligence

Working with Investors, Lenders and State Regulatory Entities

LAI understands the needs of the investment community. We provide valuable insight into the market dynamics that affect commodity prices, trade positions, and asset values. For various state entities in New England, New York and New Jersey, LAI has conducted extensive due diligence on the financing plans and adequacy of sponsorship equity to support offshore wind developer's financing plans, including realization of federal tax credits under the Inflation Reduction Act. We have performed the same service on project financed HVDC transmission projects. We have been on both the buy and the sell side of renewable, fossil, and nuclear generation asset transactions. For the U.S. Department of Energy, LAI has performed financial analysis of nuclear power plants seeking federal assistance for continued operations under DOE's Civil Nuclear Credit Program. LAI has designed financial models used by major state entities to complete the valuation of solar and land based wind facilities in New York State. Many states have relied on LAI to perform the requisite financial analysis to support issuance of zero emission credits for nuclear plants or contracts that yield adequate compensation. LAI has conducted pipeline and storage valuations using Real Option Value techniques.

LAI assists clients with financial swaps and derivative products, including value-at-risk calculations, liquidity considerations, and credit / collateral requirements. On behalf of state regulatory entities, LAI has crafted and helped implement credit enhancement and security requirements in power purchase agreements and/or state regulatory orders that compel offshore wind developers to meet target development milestones.

LAI's integrated suite of modeling tools allows investors to ask "what if" questions and to test uncertain inputs to derive expected and risk-adjusted financial outlooks and valuations. For wind energy resources, we forecast the probability distribution of energy production and the risk-adjusted revenue expectation. Our forecasts of electricity, fuel, and emission allowance prices, coupled with informed outlook on anticipated regulatory developments, provide clients with a clear view of the market conditions that determine asset values as well as the key drivers of ratepayer impacts.

LAI's support services for investors and lenders include:

• Due diligence evaluations of offshore wind developer's financing plans
• Commodity price forecasts, including capacity values under accreditation principles
• Projections of power plant and portfolio revenues, operating expenses, and EBITDA
• Enterprise and generation resource valuations, accounting for real option values
• Unsecured credit determinations based on US and international financial reports
• Marked-to-market valuations of contracts and trading positions
• Assessments of the impacts of fuel costs, generation technology improvements and pollution control strategies on financial and operating performance