A new report released by Lawrence Berkeley National Lab aims to provide a better understanding of the complex financial structures that govern the U.S. wind power sector.
Titled ‘Wind Project Financing Structures: A Review and Comparative Analysis,’ the report is co-authored by John P. Harper, Mark Bolinger and Matt Karcher and features discussion of recent trends in the financing of utility-scale wind projects in the U.S. The report includes descriptions of the seven principal financing structures through which most utility-scale wind projects (excluding utility-owned projects) have been financed from 1999 to the present and an analysis of the structures' effect on the levelized cost of energy from a generic wind project.
‘The modeling finds that, under our assumptions, choice of financing structure can have a fairly significant impact on the cost of energy from a wind project,’ notes Karcher. ‘This disparity suggests that the wind finance market is not entirely efficient, and that both perceptions and the pricing of risk differ among wind project investors.’
The report also includes a discussion of factors that developers take into consideration when selecting a financing structure. The report can be downloaded at eetd.lbl.gov/ea/emp/reports/63434.pdf