Renewables supply chain costs are going up. The cost of project debt is going up. The cost of hedging is going up. But costings for many projects were agreed long before the current turmoil, which will leave some out of pocket. Add merchant risk to the mix and what had become a largely vanilla project finance market is looking decidedly tutti frutti.
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Project finance lenders are enjoying a high fiber diet in Germany where there are no signs yet of a slowdown in deals coming to market. So what is the blueprint for getting greenfield FTTH deals done relatively quickly in Germany? And can the model be applied more widely across Europe?
The Sao Paulo Linha 6/Laranja scheme is a pathfinder deal that exhibits BNDES’ new mantra on infrastructure investment, turns typical financing under a DFI umbrella on its head and provides local currency debt.