09:00 - 10:30 New and traditional financial instruments: their dynamics and potential to lower the cost of capital
The session will address new and established financing instruments in the market, with a potential to significantly contribute to lowering the cost of capital in the wind sector. The focus here will be on the emergence of asset classes such as yieldco’s and crowdfunding, the maturing of the bond market, as well as direct and intermediated project investment by institutional investors.
- Explore the characteristics of new financial instruments and their potential to complement traditional sources of debt and equity
- Understand their dynamics, market barriers and the necessary conditions for their adoption
- Hear the perspective of the finance industry on the attractiveness of these instruments and their potential to mobilise institutional investment in wind power projects
Lead Session Chair:
David Jones, Allianz Capital Partners, United Kingdom
Thomas Maidonis (1) F Ariel Bergmann (2) Bruce Burton (3) Matthias Klaes (3)
(1) WIP Renewable Energies, Munich, Germany (2) Centre for Energy, Petroleum and Mineral Law and Policy (CEPMLP), University of Dundee, Dundee, United Kingdom (3) School of Business, University of Dundee, Dundee, United Kingdom
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Presenter's biographyBiographies are supplied directly by presenters at EWEA 2015 and are published here unedited
Thomas Maidonis is an energy economist with post graduate studies in energy and environmental resource management. He is working as a project manager at WIP Renewable Energies on the coordination of the CrowdFundRES and IndustRE projects and has been involved in different EU-funded projects (Horizon 2020, Intelligent Energy Europe and FP7) dealing with a range of technical and non-technical energy related aspects. Prior to WIP, he worked at Goldwind's R&D department in China studying the grid integration of wind energy as well as with energy consultancies in different countries gaining valuable experience on project financing.
Crowdfunding as an alternative method of financing renewable energy projects
We are currently seeing a deceleration of renewable energy growth in Europe, partly attributed to the challenges renewable energy project developers face in financing their projects. Reduced access to conventional financing options over the past few years makes it apparent that only particularly well-capitalized project developers are able to maintain control of their projects at the pre-construction stage, most often by increasing their own equity participation. This creates a need for new, innovative financing mechanisms that will help bridge the existing funding gap and cover some part of the increased investment requirement.
The fast-growing crowdfunding market offers a key vehicle for addressing this need. In crowdfunding, projects and businesses are financed through contributions from a large number of individual members of society, typically through interaction via a website or crowdfunding 'platform'. A good example of how suitable and effective this method can be for wind energy projects is provided by the recent case of a Dutch crowdfunding platform and wind project developer that managed to raise €1.3 Million in just 13 hours by selling shares in a wind turbine to 1700 Dutch households.
The CrowdFundRES project recognises the vast potential of crowdfunding for financing renewable energy projects in general - and wind projects more specifically - and aims to exploit this potential by bringing together crowdfunding platforms, renewable energy project developers and the general public, identifying and addressing limiting factors as well as promoting more effective practices among them.
Main body of abstract
At its early stage, the project is conducting a systematic in-depth survey of the perceptions and attitudes of key stakeholders in the European renewable energy crowdfunding arena, with a particular focus on hurdles to adoption and potentiality-enabling factors. Given the size of target populations, mixed-method approaches are pursued that are centered on on-line surveys but augmented, where this appears appropriate, on the one hand by systematic modelling (e.g. applied choice analysis) and on the other hand by more qualitative follow-up through targeted semi-structured interviews of subsamples.
Based on the outcomes of this work and other input, such as the review and update of existing crowdfunding regulation and recent market developments - as well as evidence of practical experience collected via case studies - the project will conduct a comprehensive road-mapping exercise by collating results in the form of context-sensitive guideline insights. This process will in turn facilitate the broader aim of providing practical guidance to stakeholders in their attempts to grow renewable energy crowdfunding initiatives in their national and international contexts.
Wind energy project developers will have the chance to:
- learn about an innovative financing mechanism that helps bridge their potential funding gaps and cover some part of their investment requirement
- receive guidelines and practical support in using crowdfunding for finaning their projects
- contribute to the project's policy recommendations
- get invited, participate and network in European and national workshops with other renewable energy project developers and crowdfunding partners