Terrawatt Initiative and International Solar Alliance announce taskforce to lower cost of PV finance
The Common Risk Mitigation Mechanism for solar generation assets is intended to identify ways to scale up investment in solar to $1 trillion, and will be supported by members of the International Solar Alliance, the World Bank Group, and the Terrawatt Initiative.
May 19, 2017 Ian Clover
Securing finance for solar projects is still an expensive business for many solar developers operating in emerging markets.
Leading voices of the International Solar Alliance (ISA) have gathered with the Terrawatt Initiative (TI) to create a new taskforce designed to promote and attract investments in solar energy.
The Common Risk Mitigation Mechanism (CRMM) will draw upon the support of both the ISA, the TI and the World Bank Group, the Currency Exchange Fund (TCX) and the Council on Energy, Environment and Water (CEEW).
Its aim is to become a decisive instrument in rapidly scaling global solar spending to $1 trillion in countries located totally or partially between the tropics, by 2030. The CRMM will, therefore, form a major part of ISA nations’ COP21 pledges made in Paris in 2015.
The cost of capital remains a major burden for solar power development in many emerging economies, the TI says. In India, the CEEW estimates that raising finance represents up to 70% of the total cost of developing a solar plant, and the hope is that the CRMM can lower these costs and make it easier for developers and governments to attract the right type of investment.
To do so, the TI says that it will work with the ISA to “create a secure environment for private institutional investments in solar assets”, by pooling risks on mutualized public resources and ensuring collective buy-in and validation of funds from both public and private entities.
TI’s chairperson, Isabelle Kocher, called the initiative a “brilliant illustration of the innovation needed in public-private cooperation” to support the scale-up of solar energy. “It is a concrete and actionable response to climate change,” Kocher added.
Conclusions derived from the taskforce will be presented at COP23, to be held in Bonn, Germany, in November this year.
Ian joined the pv magazine team in 2013 and specializes in power electronics (inverters) and battery storage. Ian also reports on the UK solar market, having worked as a print and web journalist in Britain for various multimedia companies, covering topics ranging from renewable energy and sustainability to real estate, sport and film.