The financing gap in renewable energy and how to overcome it

In Ontario, we are experiencing a financing gap for renewable energy projects on a daily basis. Projects that require debt of less than $5-10 million have great difficulties attracting non-recourse financing.

Please see attached overview (pdf) of what type and size of financing is available in the Canadian market.

How to overcome this gap? The answer is aggregation. If the project developer does not have the means to aggregate a number of projects, partnering with a like-minded, larger developer may be a successful and mutually benficial option. Reaching a critical mass will not only make non-recourse financing available, it will also allow for more favourable financing rates and equipment prices.

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