TY - UNPB

T1 - The Myth of Bankability

T2 - Definition and Management in the Context of Photovoltaic Project Financing in Germany

AU - Hampl, Nina

AU - Lüdeke-Freund, Florian

AU - Flink, Christoph

AU - Olbert, Sebastian

AU - Ade, Valentin

PY - 2011

Y1 - 2011

N2 - During the past years, Germany witnessed a remarkable boom in solar photovoltaic (PV) installations. Favorable regulatory frameworks as well as a maturing global PV industry, offering continuously lower prices, were just two of the main drivers leading to the industry’s expansion. Though, an increasing inflow of capital was another necessary factor for this development. Monitoring the new capacity installations in Germany reveals a high confidence level of investors and financial institutions in the industry’s financial opportunities, as the financial crisis and the following economic downturn did not lead to a significant slowdown in total PV installations. Although being a rooftop market mainly, Germany also accounts for the most ground-mounted megawatt installations globally with 1.4 GW of newly installed capacity in 2010. Nonetheless, the financial crisis has also left its mark. In 2008 and 2009 credit markets were mainly dried up, due to the collapse of some major financial institutions. Liquidity in the financial markets, at that time, had become a major issue for large-scale PV projects. As a consequence of the credit crunch, banks needed to recondition their lending criteria and the assessment process for project finance became stricter. Banks began to “cherry-pick” projects of outstanding quality and as a result the bankability of projects, project components and stakeholders received increasing attention. All in all, managing bankability is closely related to the concept of managing quality – and today quality is managed actively with high attention given by companies’ top management, as it serves as a key differentiation factor in global competition across many industries. The PV industry is well-advised to apply such concepts to the crucial issue of achieving bankability for projects. The following report outlines promising approaches for doing so.

AB - During the past years, Germany witnessed a remarkable boom in solar photovoltaic (PV) installations. Favorable regulatory frameworks as well as a maturing global PV industry, offering continuously lower prices, were just two of the main drivers leading to the industry’s expansion. Though, an increasing inflow of capital was another necessary factor for this development. Monitoring the new capacity installations in Germany reveals a high confidence level of investors and financial institutions in the industry’s financial opportunities, as the financial crisis and the following economic downturn did not lead to a significant slowdown in total PV installations. Although being a rooftop market mainly, Germany also accounts for the most ground-mounted megawatt installations globally with 1.4 GW of newly installed capacity in 2010. Nonetheless, the financial crisis has also left its mark. In 2008 and 2009 credit markets were mainly dried up, due to the collapse of some major financial institutions. Liquidity in the financial markets, at that time, had become a major issue for large-scale PV projects. As a consequence of the credit crunch, banks needed to recondition their lending criteria and the assessment process for project finance became stricter. Banks began to “cherry-pick” projects of outstanding quality and as a result the bankability of projects, project components and stakeholders received increasing attention. All in all, managing bankability is closely related to the concept of managing quality – and today quality is managed actively with high attention given by companies’ top management, as it serves as a key differentiation factor in global competition across many industries. The PV industry is well-advised to apply such concepts to the crucial issue of achieving bankability for projects. The following report outlines promising approaches for doing so.

KW - Sustainability sciences, Management & Economics

KW - Energy research

KW - Solar

KW - Photovoltaik

KW - Photovoltaic

KW - Bankability

UR - https://www.mendeley.com/catalogue/2879bce4-ad52-363d-8ff2-a4f3045e9e35/

U2 - 10.2139/ssrn.2067077

DO - 10.2139/ssrn.2067077

M3 - Research communication reports

SN - 978-3-00-035550-9

BT - The Myth of Bankability

PB - Goetzpartners & COLEXON

CY - München

ER -