Appraising Renewable Energy Plants

What are the primary reasons that owners or investors might engage in appraising renewable energy plants?  To answer that question, we need to first determine the difference between appraisals and valuations.  While these terms often appear synonymous, they are not. An appraisal is technically an estimate or an opinion of a property’s current market worth, considering what the market is responding to and other factors. Quite often an appraisal is done for a plant’s equipment, land, buildings, etc. and if done for an entire plant, is usually done for one that is shut down.  On the other hand, valuations, sometimes called business appraisals, are properly defined as written reports prepared to place a reasonable market value on a going concern business or a planned start-up company.  For further information see:  Appraisal and Valuation Services for Renewable Fuels Industry and Appraisals for Expert Witness Testimony and Estate Tax Purposes.

So for our purposes, let’s talk about appraising renewable energy plants in terms of equipment appraisals are done for one of the following reasons:

1. Fulling some financing needs such as an investor or bank requirement.
2. Accounting and tax matters, such as helping determine capital gains or losses,
3. Ownership division or disposal, such as plant sales or buying out partners; general asset management.
4. Insurance purposes, such as establishing replacement costs or other insured values.
5. Liquidation and bankruptcy
6. Management Planning and general asset management

There are relatively few professionals with significant expertise in measuring the value of bioeconomy businesses and assets.  Experts in the appraisal of renewable fuels businesses and plants must have substantial and specialized economic and engineering capabilities and general and specialized appraisal capabilities. These skills include business appraisal, machinery and equipment appraisal and real property appraisal capabilities.  The appraisers ought to be designated by the American Society of Appraisers or the Appraisal Institute and may require state licensure.   They should be ASA Certified Sr. Appraisers in Machinery & Equipment as well as other specialties, and Certified Business Valuations Experts, as well as designated subject matter experts in biofuels/renewable fuels, biomaterials, biomass and biomass power, feedstocks, biotechnologies, and a variety of specialty services.  The expertise encompasses things like ag biotech, agricultural waste, alcohol fuels, algae biofuel, alternative proteins, animal-free products, beverage fermentation, bio-based chemicals, biocatalysis, biodiesel conversion, biogas production, biomass power, carbon intensity, co2 utilization, combined heat & power, conversion technologies, enzyme technologies, ethanol gas, Fischer Tropsch, food waste, fuel additives, green energy grants, hydrothermal carbonization, industrial enzymes, industrial fermentation, landfill management, microbial fermentation, organic synthesis, plastic pyrolysis, plastic recycling, plastic waste, pyrolysis oil, railroad ties, reactor design, recycled plastics, and renewable energy finance.

Among its 150+ experts, Lee Enterprises Consulting has a wide range of services in bioenergy, biomaterials and chemicals, biotechnologies, and feedstocks, including specialists in appraisals. Take a look at our experts and the services we provide.  You will note that most of our experts are also available for ancillary engagements and advice, for specialty engagements like serving as expert witnesses in litigation matters.  A recent interview with our top executives is found here.  Call us at 1+ (501) 833-8511 or email us for more information.