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Delegates are invited to meet and discuss with the poster presenters during the poster presentation sessions between 10:30-11:30 and 16:00-17:00 on Thursday, 19 November 2015.

Lead Session Chair:
Stephan Barth, ForWind - Center for Wind Energy Research, Germany
Robert Clover FTI Consulting , United Kingdom
Co-authors:
Robert Clover (1) F P Aris Karcanias (2)
(1) FTI Consulting , Copenhagen , Denmark (2) FTI Consulting, London, United Kingdom

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Presenter's biography

Biographies are supplied directly by presenters at EWEA 2015 and are published here unedited

Robert is an award–winning renewable energy and sustainability professional with over 20 years’ experience of investment banking and consulting. He has written extensive research and consulted on the renewable energy industry, clean technology, socially responsible investments (ESG), climate change economics and sustainability. He has advised governments, the G20 and the IEA on energy policy. Robert is a Director at FTI Consulting in the Economics and Financial Consulting Practice, where he has a specialist focus both on Financing trends and Renewable Energy.


Poster

Poster Download poster (9.35 MB)

Abstract

INNOVATIVE FINANCING STRUCTURES FOR WIND

Introduction

About 361.4 GW and 8.2 GW of onshore and onshore wind power capacity, respectively, was operating globally at the end of 2014. The financing structures for both onshore and offshore have been changing significantly, particularly after the 2009 global financial and economic crisis which affected mainly European countries. Despite ongoing economic recovery, some developed countries are reluctant to resume support for [wind energy development as nuclear and fossil fuels lobbies also strongly press their case. Meanwhile, a revived climate change agenda and favourable policy actions, notably by the world’s two leading economies, the U.S. and China, continue to drive the case for wind.
Underdeveloped [renewable] wind energy policies in developing/emerging markets and the weak financial standing of their utilities have slowed the take-off of wind energy. But the appetite for [renewable] wind energy has been growing, driven by wind energy’s competitiveness against fossil fuels (for example in Brazil and South Africa), growing population, increasing power demand, critical power shortages and lack of infrastructure.


Approach

We outline the drivers, challenges, advantages and disadvantages of each innovative financing instrument.
We analyse the application/adoption of each financing instrument and combination of financing instruments at the sector level (onshore and offshore wind) as well as at a market maturity level (mature versus emerging markets).
We explore the refinancing market as more wind projects in mature markets reach the end of their lifespans.


Main body of abstract

The result of these changes has been a gradual shift from equity financing to debt financing and the continued adoption of new forms of financing wind energy development. This forms the main focus of our analysis. We explore wind development financing instruments that will potentially dominate the industry in the near and mid-term (post-2020).
We investigate the potential for green bonds in the wind industry – and in particular the potential for issuance of green bonds by other institutional investors besides development banks, as well as players such as utilities and wind turbine manufacturers. We explore the potential for adoption and adaption of YieldCOs in wind markets besides the United State. We also explore the potential for crowd-funding wind energy in both [renewable energy] policy adverse developed countries and in power deficient yet cash strapped developing countries (e.g., crowd-funding for a wind energy development project in a developing country as a way to bypass the official but inefficient North-South infrastructure aid). At the same time, we present the outlook for community funding of onshore wind energy projects in Europe and the adoption of this financing model in new markets.


Conclusion

As many governments in maturing European markets continue to tighten their support for wind energy development, particularly offshore wind, developers and turbine manufacturers remain under pressure to reduce costs. Alternatively, growth for both developers and turbine manufacturers is likely to come from the financially challenging new markets. In both cases, success will hinge on innovative financing initiatives.


Learning objectives
Our analysis explores new and potential partnerships between investors, wind developers and wind turbine manufacturers as well as new types of investors at different phases of wind energy project development across sectors (onshore and offshore) and market maturity. We also suggest options for putting into place innovative financing structures and demonstrate (for offshore wind) the relationship between strong political commitment and lowering the cost and risk.