Think RE looks back on their 2022 accomplishments
The year 2022 was also a milestone year for our young company history. Starting in January, we continued our activities in various markets like Sweden.
The aim of the paper is to analyze the bankability of PPAs from the perspective of banks involved in PPA transactions. In particular, it is shown how different risk categories like credit risk, including political risk, or market price risk influence the debt sizing process and its effects on PPA pricing in order tofully understand why a PPA transaction mainly depends on the financing structure of the RE asset.
In this paper we discuss the following topics:
To show the interdependency between a PPA and project financing, we conduct a study basedon three parts. First, we implement a financial model that shows the strong connection between PPA pricing and the debt sizing. Second, we analyze credit ratings and credit default swap spreads of different off-taker types and detect that electricity end-consumers like corporates can be a good alternative to the traditional utility off-taking the energy output. Finally, we conduct a survey among international banks having an exposure in global PPA markets.