Australia’s Green Power Profit May Be Under Threat
- Former risk head of Australia’s CEFC warns of tougher lending
- More corporate power agreements needed to boost solar, wind
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The profitability of Australia’s first wave of renewable power projects may be threatened as lenders will likely push for some deleveraging when they come up for refinancing, according to the former chief risk assessor at the nation’s green bank.
During Australia’s clean energy investment boom in recent years, domestic banks were generally unwilling to lend beyond five years. That means projects will face refinancing just when they’ve barely started to earn returns, Stephen Panizza, the former chief investment risk officer for the Clean Energy Finance Corp. said in an interview. That may force developers to use up cash paying down more of the loan principal or take on higher interest rates.