Mission financing

Rethinking financing

Unlock the Financing door to achieve Well below 2 cents’

Main players

The key to successfully accomplishing the mission:

SHIFT THE TRILLIONS

The obvious challenge is to shift the affordable institutional trillions to the new energy system, starting with renewable power generation, followed closely by energy management and storage.

The granularity challenge

These trillions are currently invested in large chunks in regulated, well-defined securitised and liquid asset classes traded in a limited number of financial locations. In the new system it would be necessary to invest them in small-sized alternative assets, distributed on different territories, not tradable and illiquid.

The pipeline
issue

Channelling investments to solar power generation assets, and more broadly to sustainable infrastructures, requires a financial transformation so these assets become an investable asset class. It also requires volume which the industry calls ‘pipeline’. Not a pipeline of projects, but a pipeline of normalised cash flows.

A roadmap
for scaling up financing

WHAT WE DID

TWI teamed up with Société Générale to propose a possible pathway to reach affordable finance at scale in solar power generation.

When cash flows are governed by the same law, under the same contractual arrangements and with the same guarantee instruments, from an institutional investor’s perspective they can be considered as normalised, underlining the importance of a systemic approach.

Digitisation of key processes, particularly due diligence, can help simplify work, reduce risks and accelerate investment.

Then aggregation into investable pipelines can be made with the usual financial techniques of pooling, asset management, securitisation, etc.

Our report

Our report ‘Tentative roadmap to affordable finance at scale in solar power generation’ was published on 29 November 2019 on the occasion of the fourth Climate Finance Day in Paris.

And you,

what would you do?

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Next mission

Our final report

This 200 pages report provides a summary of nearly four years of work carried out by TWI to accelerate the transition to affordable, reliable, sustainable and modern energy for all, starting with solar power. 

Download our final report, the road map of the energy revolution

200 pages. PDF format.

Final report Terrawatt Initiative

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