As marines, Rye Barcott and Dan McCready had plenty of experience performing under pressure, but neither had much knowledge about the high stakes world of investing and finance.
That didn’t stop them from leaving their well-paying day jobs to start their own firm.
Launched in 2013, Double Time Capital invests in utility-scale solar farms in North Carolina.
In just over three years, the firm has raised seven funds, totaling $80 million, from investors including Prudential Financial, Burt’s Bees, former Bank of America chief executive Hugh McColl, Jr., and former Duke Energy CEO Jim Rogers, who now advises the company.
Altogether, Double Time has financed 36 solar energy projects, which collectively produce roughly 10% of North Carolina’s solar power and power around 30,000 homes in the state.Strictly speaking, Double Time is not a venture capital firm.
It typically invests in projects that are in the late stages of construction, but may not produce a profit for several more years.
However, solar farms typically take advantage of various state and federal tax credits to help with building costs.
(North Carolina, for example, offered a 35% tax rebate for renewable energy projects until 2016.
It has not been offered since, but Barcott says that does not affect its projects currently under way.)
As a result, says Ethan Zindler, head of policy analysis at Bloomberg New Energy Finance, such funds typically need fairly sophisticated investors, who can make use of the tax credit while they wait for the solar farms to start making money.
Investors are eventually rewarded because state utilities are required by law to purchase a percentage of their power from independent energy producers, including solar farms, usually through fixed multi-year contracts.
It’s a complicated time for solar energy producers.
On the one hand, Barcott and McCready’s plans run counter to many of the prevailing national trends around alternative energy.
The falling price of fossil fuels such as coal and natural gas has dampened enthusiasm for projects like solar and wind in some sectors, for one.
The Trump administration is also openly hostile to the idea of climate change, and seems uninterested in making clean power a cornerstone of any new national energy strategy.
At the same time, it’s possible the Trump administration will eventually warm up to solar: there’s a growing national demand for clean energy.
But perhaps more importantly given the political climate, solar projects have the potential to create jobs and stimulate spending.
Today, they account for nearly 40 percent of all new power infrastructure buildouts in the U.S. in 2016 according to industry research.