Copying and distributing are prohibited without permission of the publisher
Offshore wind's cloudy interface
11 October 2011
Offshore wind’s short operating history makes it difficult to value risk and banks are still feeling their way on pricing. Construction risk and different regulatory regimes mean that one financing solution does not fit all. By Sarah Rundell.
Read more:
[offshore]
[epc]
[kfw]
[ekf]
Not so long ago the prospect of banks financing any construction risk for European offshore wind projects would have been unthinkable. Sponsors bore potentially expensive unknowns like completion delays and new technologies or third parties failing to deliver. Fast forward a few years and today’s clutch of projects currently in the debt market with construction risk are indicative of increasing levels of lender comfort, despite offshore wind being one of the most unpredictable frontier markets.
In fact when it comes to risk, offshore wind is about as fraught as it gets. There is little track record – only six offshore wind projects have reached financial close in Europe to date – and the pool of banks with experience is still small. Every deal that the bank market looks at has a new feature that advances on what has gone before. But the slow deal flow belies the pace of change...
Take a free website trial to read this article. It’s easy to get a trial – just follow this link or email info@projectfinancemagazine.com.
Or, if you’re a subscriber or have an active trial, simply log in below to read the article.
Subscribe
Subscribers have unlimited access to all current and archive content. Start your
subscription today - click on the button below.
Subscribe
Free trial
Taking a free trial will give you access to the latest news and analysis, as
well as the online deals database, BenchBase. Start your free trial today.
Free Trial