Tax equity fund sponsor Foss & Company has closed an approximately $150 million tax equity investment supporting a distributed energy portfolio in Illinois owned by a joint venture between Summit Ridge Energy and Apollo Global Management. As a tax equity syndicator, Foss & Company pools capital from corporate investors, such as banks and insurance firms, and structures it directly into renewable energy projects that generate tax credits.
The transaction marks one of the solar industry’s first announced tax equity deals executed under the tech-neutral Section 48E Clean Electricity Investment Tax Credit (ITC) framework. The deal required the participating firms to establish a new diligence process to navigate Foreign Entity of Concern (FEOC) compliance requirements introduced under recent federal legislative updates.
Moving under the Section 48E regulatory regime introduces stricter supply chain tracing to satisfy FEOC provisions, which limit clean energy tax credit eligibility for equipment tied to designated foreign entities. Foss & Company built a custom FEOC diligence framework for the transaction, establishing a precedent for how capital providers and developers can structure 48E investments moving forward.
“Beyond the size of this transaction, it demonstrates our ability to move quickly and thoughtfully on a 48E deal in the community solar market, building a FEOC diligence framework that will serve as a model for future transactions,” said Bryen Alperin, Partner and Managing Director at Foss & Company.
The Illinois project portfolio maximizes its tax credit value by combining several federal bonus adders alongside strong state-level contract backing. The projects qualify for the Domestic Content bonus credit by incorporating U.S.-manufactured equipment, the Energy Community adder for siting in targeted legacy energy regions, and the Low-Income adder intended to deliver bill savings to underserved households.
Additionally, more than half of the assets in the portfolio will participate in Illinois’ Adjustable Block Program. This state initiative secures 15- to 20-year renewable energy credit contract streams anchored by commercial and low-income subscribers, providing predictable long-term revenue for project equity.
The investment marks the eighth tax equity transaction completed between Foss & Company and commercial solar developer Summit Ridge Energy.
“Successfully navigating the FEOC requirements under the new Section 48E framework on our eighth deal together speaks to the depth of that relationship,” noted Adam Kuehne, Chief Investment Officer at Summit Ridge Energy. “This capital allows us to keep expanding access to locally generated power for commercial subscribers and low-income households across Illinois.”
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