The "flip," sometimes referred to as the "Minnesota flip," is a fairly common business structure for community wind projects. This structure grew out of the fact that the main federal incentive for wind production--the production tax credit--can be difficult for local projects (which typically have a low passive tax appetite) to use effectively.
In a flip, a local wind project partners with a larger entity that can better use the tax credit. The upside of a flip is that it can create an important revenue stream for a local project, but one downside is that it creates a complex tax situation.
Good news came across my desk yesterday, however, in the form of an email from Paul at C-BED. He forwarded a press release from Stoel Rives (a law firm that does a lot of business in wind) about a new revenue procedure from the IRS that clarifies some of the previous ambiguity about the flip.
You can also find the IRS's synopsis in Bulletin 2007-45 (skip to page 967).