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Who should attend
- Financiers involved in project finance, investment analysis and syndicated lending
- Government and Parastatal Executives involved in sponsoring/assessing project finance deals
- Bankers (Commercial, Investment, Institutional, Corporate and Development)
- Project Managers
- Investment Analysts
- Project Sponsors
About the course
The Green Energy Project Finance four-day programme will teach you how to analyse renewable/green energy project financing and investment opportunities, with particular emphasis on intermittent technologies like solar and wind, explaining how they differ from conventional power facilities.
The last day of the course features a hands-on modelling session where you will learn how to construct a model to forecast cashflows of an 8MW solar facility, estimate LCOEs, and test the project for debt capacity and investor returns.
By the end of the programme, you will know how to structure project transactions to minimize risks and improve the prospects for future strong performance both in existing portfolios and new transactions.
Themes: Structuring Renewable Projects and Creating a Security Package; Discovering the Most Efficient Sources of Debt Finance Introduction to Cash flow Forecasting Metrics.
Overview of Renewable Energy Project Financing
- Global Growth of the Market: Countries, Sectors, Drivers of growth
- Energy usage and investment globally
- Renewable Energy Projects and Comparative Levelized Cost of Energy (LCOE)
- Wind Farms
- Solar Power
- Landfill Gas
- Geothermal Energy
- Small-scale Hydro
- Global Incentive Programs
- Feed-in tariffs (FIT)
- Renewable portfolio standards (RPS)
- Renewable Energy Credits (RECs)
- Depreciation, Allowances, etc.
- Public Tendering
- Other Grants and Incentive by Country
- Financing Structures and Players
Renewable Project Risk Identification and Allocation
- Different Approaches/Risks Compared to Conventional Power Project Finance
- Construction and Warranty Issues
- Land Acquisition
- Environmental and Permitting Considerations
- Technology Advances
- Operational Issues
- Transmission and Interconnection
- PPA Considerations: Availability, Energy and Environmental Credits
Workshop: Assessing Debt capacity and Investment Opportunities
- Forecasting Techniques and Limitations
- Cashflow Sensitivity Analysis and Creditor Considerations
- Sponsor Return Calculations
- Tax-equity Investors and Considerations
Case study: Delegates break into small groups to evaluate the security package for a wind power plant. They will look at financing choices, structure, project cash flows, and quantify their risk assessments.
End of Day 1
Themes: Legal Issues, Bank Finance, Capital Market Issuance; Political Risk Support; Leasing and Islamic finance
Further Legal Issues and Contractual Considerations for Intermittent Power
- Key Contractual Agreements and Structuring Considerations
- Power Purchase Agreements (Pricing Structures, Milestones and Penalties)
- Equipment Supply and Timelines
- Balance of Plant (BOP) Agreements
- Land Lease
- Shareholder Structures
Bank Debt and Capital Markets as Funding Alternatives
- Bank Debt Term Sheet Considerations, Club Loans and Syndications
- Domestic and International Capital Markets Access: Eurobonds, Private Placements
- Rating Agencies, Basel Accords, and Credit Wraps
Electricity Price Hedging
- Commodity Pricing and Hedging Mechanisms
- Hedges for Renewable Energy Projects
- Leasing Structures for Renewable Projects
Leasing Structures and Applications in Renewable Projects
- Evaluating Cost
- Islamic Structures: Ijara and Istisna
Case Examples: Wind and Solar
Focus on Solar power
- Solar Photovoltaic Systems and Concentrating Solar Thermal (CST)
- Thin Film vs Crystalline Technologies
- Tracking Systems
- Issues of Scale, Cost and Application
- Financing Challenges and PPA solutions
- Roof and Ground Leasing issues; Other Site Requirements
- Technology Warranties
- Financing Standards and Requirements; DSCRs etc.
Case study: Financing a photovoltaic solar park. Evaluating the security package and forecast outcomes.
End of Day 2
Themes: Base Load Plants; Bio-mass, Hydro and Geothermal Power; Projects in Emerging Markets
Bio-mass and Bio-fuel Projects
- Wood Power Generation
- Generating Energy from Waste
- Bio-mass and Bio-fuels: What are the Prospects for these Technologies?
- Emissions, Disposal, and other Regulatory issues
Case example: Wood-fired Bio-mass project
Developing Projects in International Markets
- Sources of Credit and Risk Support for International Renewable Projects
- Official Political Risk Enhancement (ECAs, Development Banks and Others)
- Private Sources of Political Risk Insurance
Case Discussions: Projects in Emerging markets
Base load Renewable Producers: Geothermal Plants
- Where are these facilities located?
- Technologies: Dry and Flash Steam; Binary Plants
- Resource Assessment and Drilling Risk
- Construction and Transmission
- Government Role
Case Example: Geothermal Production
- Favorable Features and Drawbacks of Hydro-power
- Conventional Hydro Facilities (Medium and Large)
- Small-scale Run-of-the River Plants
- Pumped storage
- Financing Considerations
- Structuring Investment and Approaches to Project Solicitation
Case Study: Financing a small-scale hydro facility. Participants will evaluate the financing package. Transaction requires political risk mitigation as well as consideration of merchant power project risks.
Themes: Financial and Economic Analysis - Cashflow Modeling Workshop
Building a Cashflow Model for a Solar facility
Delegates will assess a wide range of scenarios in order to test a limited recourse financing package for debt capacity and suitability of investment. Includes discussion of common approaches to modeling with Excel, “do’s” and “don’ts” as well as the practical use of models for negotiations
Structuring the Model and Organizing the Data to Create a Cashflow Statement
- Developing the Assumptions Page
- General Plant Parameters
- Installed Plant Capacity
- Panel Efficiency
- Insolation and Panel Wattage
- Operating Months and Degradation
- Project Capital Costs
- Equity First or Pro Rata
- Manually Designed Equity Subscription
- Draw-down of Debt Linked to Specific Contracts or Expenditures or in a Hierarchy
Developing the Profit and Loss and Balance Sheet
- Factoring in Reserves
- Considering Currencies
- Tax Calculations
Ratios and Sensitivity Analysis: Objectives and Limitations
- Measuring Debt Capacity and Investor Return
- Using Modeling Output for Initial Project Vetting
- Supporting on-going Negotiations
Self-test, Summary and Wrap-up of Modeling Workshop
Ms. Osius designs and delivers executive level training sessions as well as providing consulting services to a wide variety of organizations worldwide. Specializing in international project finance, capital markets, and risk management, she works with corporate investors, private and development ...
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