Coronavirus-fueled disruptions in global supply chains for renewable energy projects have developers on edge that the resulting delays could jeopardize power purchase agreements and federal tax credits that are crucial to their projects getting built, Law 360 reports.

Production delays and supply shortages in China and other countries effected by COVID-19 are already causing force majeure notices to roll in from solar and wind equipment manufactures.

Threats to the viability of a power purchase agreements (PPAs) or tax credit eligibility could give investors second thoughts about sinking cash into renewable projects. Some projects could not only blow operational deadlines contained in PPAs that developers have inked with electricity buyers, but also project completion deadlines they must meet to reap the full available value of the federal investment tax credit for solar projects or production tax credit for wind projects, experts say.

“The status of key legal agreements governing a project will also play a role in whether concerns over coronavirus-related development delays derail a project,” said Mona Dajani, leader of Pillsbury’s Renewable Energy practice.

“Those deals that are well underway, those are still going forward,” Dajani said. “The ones where they've pulled the plug are the ones that are too new.”

Read the full text in Law 360.