Packaging a Preferred-Equity Clean-Energy Fund for LPs

Situation

The client is a clean-energy investment firm that takes minority preferred-equity positions in tax-credit-eligible renewable portfolios — battery storage and adjacent mature technologies. It had a ~$1.0B completed track record and a ~$6.0B forward pipeline, and needed to raise fresh capital from limited partners. Its edge was a genuinely differentiated structure: mid-teen, effectively tax-free returns, more than half the total return delivered in Year 1 via investment-tax-credit monetization, and a senior preferred position with a defined Put/Call exit.

The problem was translation. That structure is financially sophisticated — and it had no institutional-grade materials to communicate it. A sharp idea that an LP can’t quickly understand doesn’t get funded. The engagement’s job was to turn the economics into a fundable narrative, fast.

The engagement

CMA built the LP pitchbook and the cash-flow model behind the raise — a five-section book (the firm, the offering, the pipeline, the fees, and a case study) sitting on a defensible model.

The economics, modeled year by year

The core of the book is a year-by-year after-tax cash-flow model of the preferred position: a Year-0 net outflow, modest variable distributions through the hold, and a Year-6 buy-out — solving to a 12% investor after-tax IRR. What makes the profile distinctive is the shape: because tax-credit proceeds fund an upfront return, more than half the total return lands in Year 1, sharply de-risking the duration.

A proof point, not a promise

The offering could have stayed abstract. Instead it was validated against a live flagship — an $834M, 700 MW / 1 GWh ERCOT battery-storage portfolio the firm had invested in near commercial operation, generating roughly $300M in tax credits and ~$75M of annual EBITDA on ~$146M of equity. That single case study turns “here’s our structure” into “here’s the structure, working, at scale.”

The framework that underwrites “low risk”

A “low-risk” label means nothing without mechanics behind it. The book names them: a fee waterfall (2% management, a transaction fee, and carry only above a 10% hurdle) and a de-risking framework — an EBITDA-insurance floor, contracted cash flows across mature technologies, Tier-1 equipment, and entry at near-commercial-operation to strip out construction risk — all backed by a sponsor guaranty on the exit.

Why the structure mattered

The discipline was to make a sophisticated structure legible without dumbing it down. LPs in this space are technical; the pitchbook had to be precise about the cash-flow shape, the fee alignment, and the risk mechanics — and then prove it against a real portfolio — all on a compressed timeline. Modeling the economics year by year, naming the de-risking framework, and grounding the offering in a live $834M case study is what turns an elegant idea into an institutional-grade raise.

Impact

The firm left with an LP-ready pitchbook delivered on a ~3-day turnaround: a five-section narrative, a year-by-year after-tax model solving to a 12% IRR with 50%+ of return in Year 1, a clean fee-and-risk framework, and a live $834M proof point — the institutional packaging a $1.0B-track-record firm needed to raise against its $6.0B pipeline. (Figures are drawn from the engagement’s modeling and the referenced portfolio; realized fundraising outcomes are not reflected.)