- 100% Tax Deduction Against Taxes-Owing
- 7% Minimum Annual Dividend Distribution
- Investing In CHP Systems – A Mature, Proven Technology
- Reduction In Greenhouse Gas Emissions – Contributing To A Cleaner World
- Liquidity Option Within 18-Months
AI Renewable 2020 – I Limited Partnership
Of the gross proceeds of the Offering, an initial allocation (7.5%) is used to pay the Partnership’s operating, administrative and maintenance expenses that do not constitute CRCE, but which are expected to be fully deductible for the pertinent tax year. The balance of the gross proceeds (92.5%) are used to pay the “start-up” costs for the project(s), including preliminary engineering work and feasibility studies. Up to 100% of these expenses are expected to qualify as CRCE. Therefore, all of the gross proceeds from a Limited Partnership Offering are expected to be fully tax-deductible against taxes owing.
The Limited Partnership will pay out a targeted, tax-efficient annual distribution in the form of a dividend targeted at a of minimum 7% (1.75% payable quarterly) to investors. The distribution will be paid from the profits of the projects. Dividend income receives a more favourable tax treatment than interest income.
Within 6-months of closing management may form a Capital Pool Company “CPC” to be listed within 18-months, enabling a liquidity option where the CPC will make an offer to acquire the unitholders’ interest in the Limited Partnership.
Structure – Flow-Through Limited Partnership
AI Renewable finances clean and renewable energy projects by way of a Flow-Through Limited Partnership structure.
- A flow-through (pass-through) entity is a legal business entity that passes income and eligible expenses on to the owners and/or investors of the business.
- Flow-through entities are a common device used to limit taxation by avoiding double taxation.
- With flow-through entities, the income is taxed only at the owner’s individual tax rate for ordinary income.
Limited Partnerships consist of:
- General Partner, who manages the business and has unlimited personal liability for the debts and obligations of the Limited Partnership, and
- Limited Partners, who have limited liability and are shielded to the extent of their investment but cannot participate in management.
Our limited partnerships are suited to individual, high net worth investors, who seek a steady, reliable cash flow, in an investment that tends to have a low correlation to the market. The tax-efficient nature of the money raised provides lower-cost capital to fund project development.
To achieve its investment objectives, the Partnership either directly or through one or more special purpose vehicles, will seek to:
- finance “Canadian renewable and conservation expenses” (“CRCE”) under Projects pursuant to various Canadian Federal and Provincial programs that encourage the development of renewable energy and energy-efficient projects in Canada, including CHP, solar, geothermal and other such energy-efficient projects
- acquire economic interests, either directly or indirectly, in Projects and/or Energy Contracts held by project developers and/or special purpose vehicles other than the fund manager or its affiliates;
For projects that pass the feasibility study, AI Renewable will look to enter into a CHP Energy Service Agreement (“ESA”) with creditworthy customers. The energy generated by the Projects will be purchased by customers at a discounted rate from their current cost per energy bill, for a fixed term.