The global demand for renewable energy sources is growing, in turn creating investment needs in the region of US$1 trillion a year. When confronted by such a huge sum, ensuring the bulk of smaller projects on the renewables financing spectrum do not get left behind is of primary concern. Thankfully, a solution that increases asset financing volumes has already been found by investors: the aggregation of portfolio assets, otherwise known as “bundling”, has become a staple of renewables financing.
Writing for Energy Voice, S&P Global Ratings’ Trevor D’Olier-Lees, senior director, global infrastructure ratings, discusses his observations of bundling’s application in the renewables sector. He stresses that while bundling is nothing new in project financing for larger, utility-scale assets, “infrastructure financiers are increasingly looking to bundle smaller-sized assets, including smaller commercial and rooftop solar installations – with strong interest in bundled deals being seen across Europe and Asia”.
While he emphasises that bundling should not be considered the magic bullet to increasing financing volumes, D’Olier-Lees believes it has, nonetheless, found a sweet spot in the renewables sector. He writes: “Bundling could help produce win-win scenarios for all involved counterparties. With this in mind, we expect bundling’s application in renewable energy financing to continue.”
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