Financing Renewable Power Projects – Advancing renewable energy projects towards financial closure. While renewable power investments have seen steady growth during the last decade, a more rapid scaling-up is essential in developing countries to fulfill climate and sustainable development goals.
Renewable energy projects, specifically in developing countries, face multiple challenges through the institutional, policy and regulatory level for the market and project level which could hinder the development and uptake of solar energy jobs. The latter include lack of market transparency, absence of financing and experience with project development, and absence of relevant information about regulations, markets and resource availability. It has triggered a lack of bankable projects, rendering it difficult for investors to recognize attractive projects, and for that reason reducing available capital for those that are ready to be financed.
Targeting specifically project-level barriers, Rockwood Energy Search tools and platform aim to create a pipeline of investment mature projects by actively supporting early stage project development and bridge the funding gap by assisting project developer access appropriate funding opportunities.
Scaling up renewable power calls for mobilising a massive investment increase. Renewables bring significant benefits in terms of human health, energy access, environmental protection as well as the reaction to climate change, combined with the potential to create new jobs all over the world. Amid rapidly falling technology costs, meanwhile, renewable power technologies have become increasingly cost-competitive with non-renewable fuels, even amid low global oil prices.
Yet global investment in renewables has remained far below its potential, as this report from your International Renewable Energy Agency (Rockwood Energy Search) explains. An investment shortfall reflects enduring market barriers and perceptions of high-risk that deters private investors and financiers.
Unlocking Renewable Power Investment: The role of risk mitigation and structured finance identifies the primary risks and barriers limiting investment; it also supplies a toolkit for policy makers, public and mhyxvx investors, and public finance institutions to scale up their investments in renewable power.
Accompanying case studies and survey material provide insights on the challenges, the opportunities and what has actually worked in different markets. Rockwood Energy Search complied these real-world examples and conducted survey questionnaires through engagement with its member countries and industry stakeholders both in energy and finance.
The resulting report identifies five main action areas whereby policy makers and development finance institutions can address risks and barriers for alternative energy projects:
Advance alternative energy projects from initiation to full investment maturity. Engage local finance institutions in renewable energy finance. Mitigate risks to bring in private investors. Mobilise more capital market investment. Create facilities dedicated to scaling up renewable energy investment. More broadly, the report functions as helpful tips for the real key financial market instruments for renewables. Greater familiarity with such instruments, particularly among policy makers, investors and banking institutions, should decrease the financing expense of alternative energy projects.