Crisis will filter renewable energy projects

The crisis will set apart companies that can invest in renewable energy from those that cannot. This will put further pressure on companies, which expected to recover their investment in five years, when, in fact, it will take eight to ten years. This summer, when oil prices reached a 150-dollar per barrel peak, saw the announcement of several investments worth hundreds of millions in renewable energy generation. The financial crisis has cut over half the value of oil, energy consumption is expected to fall, as are prices, while banks are increasingly reluctant to grant funding. How attractive are renewable energy investments under these circumstances? “Funding will be more difficult to secure; in this field, most of the projects announced rely exclusively on foreign funding, and not on the companies’ own capital. Many of these plans will fail to materialise, because this crisis will separate the strong companies from the weak ones. The financial crisis and its impact on the oil barrel will pose problems to those investing in renewable energy due to the increase in financing costs and to the higher investment recovery period,” explains Radu Popoiu, general manager of PS Wind Management Ro, the company through which Polish investment fund Continental Wind Partners (CWP) operates on the local market.